Wealth Management
U.S. stocks ended mostly flat after the Federal Reserve held interest rates steady and signaled slower future cuts, while geopolitical tensions between Israel and Iran pushed oil prices higher.
Fed Chair Jerome Powell emphasized that future rate decisions will remain data-dependent and warned of rising consumer prices this summer due to Trump’s new tariffs. Despite earlier gains, markets lost momentum following the Fed’s cautious tone; the Dow slipped 0.10%, the S&P 500 dipped 0.03%, and the Nasdaq edged up 0.13%.
Meanwhile, Brent and WTI crude rose slightly amid fears of broader Middle East conflict and supply disruptions. U.S. Treasury yields, initially lower on safe-haven demand, rebounded after Powell’s comments on inflation.
Finsum: Economic data added to uncertainty, with retail sales declining sharply in May and jobless claims suggesting weakening labor market momentum.
The active Exchange-Traded Fund (ETF) market in the US is experiencing rapid growth, with assets expanding from $81 billion in 2019 to $631 billion in 2024. Despite this surge, active ETFs still comprise only 6% of total active Assets Under Management (AUM), suggesting significant room for expansion. However, success in this space is not guaranteed. A small number of dominant funds and managers capture a disproportionate share of flows, and early asset accumulation – particularly in the first year – is a critical determinant of long-term success.
The paper outlines three strategic imperatives for managers looking to launch or scale active ETFs:
- Go with the flow -Success hinges on robust distribution, particularly within Registered Investment Advisor (RIA) channels, which account for the majority of active ETF assets. Managers must align with the right distributors and tailor outreach to platform-specific dynamics, recognizing that entry barriers are higher in brokerdealer and wirehouse channels.
- Pick a lane -Leading managers have thrived by leveraging one or more of the following: unique investment strategies (e.g., innovation, income), proprietary distribution channels and strong brand identity. While hitting on all three is unlikely, identifying and doubling down on one’s inherent strengths is essential.
- Less is more -Focused engagement with high-potential advisors who already use active ETFs significantly improves conversion and gross sales. By prioritizing advisor scoring and segmentation, managers can better allocate resources and boost early momentum. Other key insights include the diversification of active ETFs beyond bonds to equities and niche strategies, declining concentration among top managers and the critical role of tailored incentive structures for internal sales teams during the launch phase. Ultimately, while the market presents significant tailwinds, achieving “escape velocity” requires precise execution across product design, distribution, marketing and sales
Access the paper here.
Independent financial advisors switching broker-dealers prioritize a smooth transition, supportive infrastructure, and a business-friendly environment with product and operational flexibility.
Recruiter Derrick Friedman emphasizes that advisors now have the leverage to demand these conditions—and if broker-dealers (BDs) don’t meet them, they risk decline. Industry consolidation has shrunk the pool of large BDs, prompting many advisors to consider RIAs, especially those seeking fewer compliance burdens and more freedom to grow fee-based practices.
Hybrid models remain attractive to advisors who still maintain transactional business and want to retain flexibility. Technology—like DocuSign—has reduced friction in transitions, making it easier for advisors to move their book of business quickly.
Finsum: While RIAs are expanding rapidly, BDs aren't disappearing; instead, consolidation is pushing advisors and recruiters alike to explore a wider landscape of firms.
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On May 28, 2025, the U.S. Department of Labor rescinded its 2022 guidance that had discouraged 401(k) plans from offering cryptocurrency investments, signaling a return to investment neutrality.
The original 2022 Release had raised concerns in the benefits industry by implying heightened fiduciary scrutiny for crypto, leading to legal challenges, though it was ultimately deemed nonbinding. Despite lacking legal force, the 2022 guidance effectively chilled crypto’s inclusion in retirement plans, with GAO data showing minimal adoption and crypto exposure limited mostly to self-directed brokerage windows.
Under the Trump administration, broader federal policy shifted to encourage digital asset innovation, with agencies like the SEC relaxing enforcement and facilitating clearer frameworks for crypto. While the Labor Department has not explicitly endorsed crypto in 401(k)s, it now stresses fiduciaries must evaluate all investment options contextually and prudently.
Finsum: Whether this neutral stance extends to other investment types or persists beyond the current administration remains an open question.
Oil prices surged as much as 14% in their biggest intraday jump since 2022 after Israeli airstrikes hit Iranian military and nuclear targets, rattling global energy markets. Though prices later pulled back, Brent and WTI crude still ended up nearly 6% on the day, reflecting heightened investor anxiety over potential disruptions in Middle East supply.
The attacks avoided Iran’s vital oil infrastructure—like Kharg Island and key pipelines—tempering fears of immediate output losses, but analysts warn that any escalation could still threaten flows through the Strait of Hormuz.
About 20% of global oil transits that narrow waterway, making it a critical choke point vulnerable to retaliation or blockade. While Iran vowed a strong response, energy analysts say an all-out disruption would hurt Tehran too, particularly as it relies heavily on oil exports to China.
Finsum: For now, traders are eyeing whether the conflict expands into an “energy-for-energy” tit-for-tat, which could turn market jitters into a full-blown supply crisis.
Interval funds, which offer limited liquidity and access to private markets, are gaining traction as investors seek alternatives to traditional ETFs and mutual funds. Asset managers like TCW, Blackstone, and Vanguard have launched new interval funds this year, bringing the total to 139 with about $100 billion in assets.
These funds, which allow redemptions only at set intervals (typically quarterly), enable investments in less liquid assets like private credit. For example, TCW’s new fund focuses 80% on private asset-backed credit, illustrating the shift toward alternative income strategies.
Meanwhile, attempts to bring private asset exposure to ETFs, such as the PRIV ETF, have struggled due to regulatory concerns over liquidity and naming.
Finsum: Advisors are increasingly allocating client portfolios to interval funds, favoring their higher yields despite reduced liquidity and higher fees.