Top-Down and Bottom-Up is the Mutual Fund Mantra at USAA
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Friday, October 17, 2014

Top-Down and Bottom-Up is the Mutual Fund Mantra at USAA

Keith Sloane's mutual fund distribution strategy at USAA [profile] is both "top-down" and "bottom-up".

Sloane, head of third party distribution for the military-focused financial services firm's mutual fund business, says he's dramatically growing his team. His strategy is two part: on the one hand, he's engaging with key distribution partners, like broker-dealer home offices, from the top down. And the second piece is going directly to financial advisors, particularly in Texas and the Mid-Atlantic where USAA's reach is deep thanks to the strong military presence.

"We really kind of stuck a stake in the ground about two years ago," Sloane tells MFWire, noting that USAA previously only had limited agreements or accommodations with a few outside distribution partners. Now, he said, they "have about 44 dealer agreements out there"

Sloane describes USAA, up to 2012, as perhaps "the last of the big direct-sold fund families." He had to "build out a foundation" for third-party distribution, building a team, marketing tools, value adds and the like.

"It's first get the lights turned on, get on the shelf," Sloane says. "It's deepening and it's engaging the product leaders at the home office, the research analysts."

Sloane and his team are taking the time to educate the marketplace. He points to USAA's "very respected brand" with military families as translating into a kind of "passionate member advocacy" that he aims to spread.

"We have a lot more to do when it comes to awareness with advisors," Sloane says. "That will take years."

"We have a few open gaps," Sloane adds. "We continue to work hard to build awareness, to engage centers of influence, to improve our business development activities."

"All of that is right on track. We are very, very pleased with the progress," Sloane says. "We're in for the long run."

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