02.26.20
Bear Market Would Bode Well for Fixed Annuities: Reports
by: Emile Hallez
Favorable conditions for fixed indexed annuities (FIA), including better interest rates and a potential bear market, would give sales a big boost, as would increased sales through broker-dealers and new designs that would be appealing to consumers, according to a report from Cerulli Associates. “FIAs should not be harmed greatly by Fed rate cuts, and if markets become volatile and or bearish, fixed annuities will once again serve as safe havens for risk-averse investors,” Cerulli wrote. “The largest catalyst of growth comes from changing distribution dynamics,” the report said. “The independent broker-dealer channel experienced the largest 10-year gain in fixed annuity market share, at nearly 8 percentage points; regional broker-dealer market share has grown too, by almost 7 percentage points.”
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