The Great Stagnation

Asset management hasn’t changed all that much over the last few decades. Despite all the headlines about consolidation, disruption, pressure on fees, and so on, the asset management industry today doesn’t look too different from a decade ago. Full-service wealth managers still charge high fees while offering dubious value. The last real product innovation was the Exchange Traded Fund (ETF), hailing back to 1993.

The industry’s most recent change is for brokers simply to lower prices, with commissions dropping to zero in many cases. A lack of pricing power, however, is more an indication of commoditization than anything else —…