Thread regarding Fidelity Investments layoffs

At some point, 91 flavors stops being choice and starts being camouflage.

When I was a branch rep, it was about finding a client’s anxiety, reflecting it back to them, and then neatly tying it to PAS.

“You’ll have access to Fidelity’s best and brightest minds.”
“We’ll take the emotion out of investing for you.”

That was the script I was given. The irony is that low-cost index ETFs quite often do a far better job of removing emotion than most managed overlays ever will. They’re rules-based, transparent, cheap, and they don’t need a quarterly story to explain why nothing actually changed. Sure, there are clients who genuinely shouldn’t manage their own money. Behavioral risk is real. But I’m highly skeptical that this suddenly applies to such a large percentage of the population once rep sales goals are introduced. But what do I know.

From what I’ve heard since leaving the branch, the sales approach has only become more aggressive and more scripted. That’s not surprising. Fidelity largely exhausted the Boomer generation that was trained to equate “professional management” with value. Now reps are meeting Gen X clients who are more tech-savvy, more fee-aware, more benchmark-literate, and far less interested in paying an ongoing fee for something that looks suspiciously similar to a self-managed allocation fund. So the answer isn’t simplification. It’s more wrappers, more branding, more narratives. Freedom, Blend, PAS. All different labels and same exposures but all going through the same toll booth.

In my opinion, managed solutions don’t primarily solve an investment problem. They solve a revenue and retention problem. Fidelity is very good at being a large asset manager but let’s not confuse product sprawl with innovation, or emotional storytelling with better outcomes.

Managed accounts are a total money maker for Fidelity- able to capture the fee in addition to the expense ratio's in the funds chosen. This is one of the spokes in the green machine wheel that feeds the beast.

It's great to have allocation funds as well as other types of funds whether sector, index or income but agree firms can slice & dice fund offerings too much where it is gimmicky versus a real investment strategy. An example is the Women Leadership Fund that was offered in the Fidelity 401K replacing various other sector funds. How is that a basis for performance or diversification? The next thing would be a fund that CEO's all have grey eyes. Hey, if it is proven that female leadership run companies outperform male run companies and there is some real data supporting that claim then I can see it being a legitimate offering.
PAS= Managed Accounts client's think they are paying for the investment selection but in reality, the real cost is paying for them to speak with advisors mostly to talk them off the ledge when the market is correcting. Which maybe is worth it to some investors but it makes it very challenging for the Fidelity rep to justify the cost when the same allocation in a self managed fund is outperforming over time the PAS allocation. So many clients do not even see value in performing an annual review so they are paying money for something they do not even use like an unused gym membership. Fidelity invests a lot of resources in selling the advisors on PAS so they can in turn sell clients but spend enough time in PAS and you will see it is a joke especially the whole business cycle non-sense, that is just another form of attempting to time the market. Now with UMH increasing most client's stock exposure the next downturn will be catching a lot of clients off guard- markets do not always go up. Most PAS clients are elderly and I suspect investment firms are scrambling to attract younger investors into managed solutions of the demographics are changing as more younger investors are more educated realizing investing in low cost index funds will achieve market returns without wasting money feeding the firm.