Auckland investment consultancy firm, MyFiduciary, will offer a tailored version of the Morningstar adviser platform in NZ after inking a deal with the research house last week.
Under the agreement, MyFiduciary will market the Morningstar Adviser Research Centre (ARC) tool to NZ financial advisers overlaid with its own portfolio construction and asset allocation models.
Chris Douglas, MyFiduciary principal, said the deal would give NZ advisers access to the substantial pool of Morningstar data and research along with investment models built from a NZ perspective.
“ARC is a fantastic platform to deliver research to advisers,” Douglas said. “The Morningstar data and research is embedded in ARC but we can also upload our own content to the system.”
He said there was a growing demand for better research tools from smaller financial advisory firms in the lead-up to the Financial Services Legislation Amendment Act (FSLAA) regime.
Last week the government confirmed a June 2020 start date for the FSLAA era, which would impose a higher burden on all financial advice firms to justify product choices for clients.
Douglas said over the last few months MyFiduciary had fielded a notable increase in queries from advice firms looking for independent research solutions.
Adviser research businesses have floundered in NZ over the last decade or more that has seen two Australian firms – Lonsec and van Eyk – launch brief, ill-fated ventures across the Tasman as both Morningstar and locally-owned business, FundSource, struggled.
Morningstar, for example, now counts just one NZ-based employee, Greg Bunkall, who works from home, compared to a previously well-staffed Auckland office. In May another Australian research house, Zenith Investment Partners, bought FundSource from reluctant owners (the NZX) for an undisclosed – but reportedly tiny – sum.
While Zenith may revitalise the flagging FundSource brand, Douglas – who joined MyFiduciary from Morningstar a year ago – said financial advisers appreciate an on-the-ground presence from researchers.
“We’re a local company supplying local advisers – not a fly-in, fly-out consultant,” he said.
Regardless, both Zenith and Morningstar (from its Sydney headquarters) will keep up the Australian presence in the NZ retail investment research world.
MyFiduciary’s deal with Morningstar is not an exclusive partnership, leaving the global research house free to push ARC in NZ under its own name – although probably the two will play in different parts of the market.
In a statement, Jamie Wickham, Morningstar Australasia managing director, said NZ had been an “important market” for the research house for over 20 years.
“We continue to look for opportunities to help advisers run efficient practices and empower investor success,” Wickham said in the release. “Morningstar is the longest-standing provider of fund manager research in New Zealand, and we’re pleased that this agreement gives us the opportunity to offer our independent research to advisers who work with MyFiduciary.”
Offshore, Morningstar has also shown a willingness to partner with potential rivals in complementary data-sharing deals.
For example, last October the group added Mercer’s “global institutional manager data and research” to its Morningstar Direct product.
The deal would see institutional investment data held on the MercerInsight platform copied to Morningstar Direct, creating a “seamless link amongst strategy, vehicle data and analytics”, according to a statement at the time.
Tricia Rothschild, Morningstar chief product officer, said in the release: “We’ve seen how asset management firms, investment consultants, and wealth managers have struggled to find a comprehensive, forward-looking, qualitative research solution at the strategy and share-class level.
“We selected Mercer for this venture to close that gap by developing a global solution that will help advisors, asset managers, and investment consultants focus decision-making and create new investment options for the end investor, driving stronger outcomes.”
The joint Morningstar/Mercer service was due to be “rolled out by region” starting with the US early this year, the statement says.