Finance

Diversity among financial planners has improved slowly. Still, 83% of certified financial planners in 2021 were white and 77% were men, according to the CFP Board.
CNBC spoke with Dennis Moore, the new president of the Financial Planning Association, to get his take on why diversity lags and what the trade group is doing about it.

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Financial planning — and the financial services industry, more broadly — has long been an arena of predominantly white men.
Industry leaders have been working to boost diversity, and while progress has been slow, it seems to be bearing some fruit. Still, 83% of certified financial planners in 2021 were white, and 77% were men, according to the CFP Board.

CNBC spoke with Dennis Moore, CFP, the new volunteer president of the Financial Planning Association, to discuss diversity roadblocks and what the trade group is doing to foster a more inclusive culture. Moore, who will serve a one-year term as FPA president, is chief operating officer of Dallas-based Quest Capital Management.
Greg Iacurci: Is diversity a core issue for the FPA?
Dennis Moore: It is. Our industry has a long way to go to increase the diversity of our practitioner community. The American public is becoming more diverse, and our profession is falling short of matching that growth.
GI: How might more diversity benefit consumers, too?  
DM: Financial planning is for everybody; everybody needs competent and ethical financial advice. At the same time, they’re looking for someone that they have some commonalities with. If we really want the public to thrive and engage in financial planning, we need to be sure that our financial planners reflect the diversity that is within America.

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We’re also hoping to make financial planning a career choice that’s more known. That goes from everything from outreach on college campuses to encouraging mentorships to diversity scholarships to attend some of our FPA events. It’s important for the profession and important for the consumer.
GI: How do you gauge success?
DM: If we can basically mirror the diversity that’s in the U.S., I think that’s a great target.
GI: How is the FPA fostering that?
DM: We have a Diversity and Inclusion Committee at FPA that works closely with the board and helps us look for opportunities to support our diverse membership.
We have what we call “knowledge circles,” [for example]. They’re seven different community-based circles [for] diverse parts of our membership, from women in finance to African Americans, Asian Americans, Pacific Islanders. Just over the last year, we’ve had a 22% growth in these communities. That’s one way we’re reaching out to existing members and hopefully encouraging more to join FPA.

We’ve been working with our conference task forces to feature D&I thought leaders [and] host different events to celebrate diverse membership at our events.

Dennis Moore
president of the Financial Planning Association

GI: What do they do?
DM: Each one may have a different cadence but [generally have] monthly meetings. [Participants] have an opportunity to engage in discussion, hear from experts, build relationships throughout FPA.
We’re [also] developing a plan for more diversity, equity and inclusion training for the board and the staff. Our goal is to expand that training out to all our FPA volunteers. We’ve been working with our conference task forces to feature D&I thought leaders [and] host different events to celebrate diverse membership at our events.
We also have The Journal of Financial Planning. We’ve had entire issues dedicated specifically to diversity and inclusion, with our next one coming up this fall.
GI: Why has diversity been an issue for the profession?
DM: I think some of it is lack of awareness of this being a vital career path. There are still a lot of people who don’t know what financial planning really is. Whether they’re starting out in college in a financial planning program somewhere or are career changers — whatever it may be — I think we’ve got to get better about showing that opportunity.

GI: What if you’re not going to college? It may be even harder to become aware of it as an option.
DM: Right.
GI: So it kind of starts in high school — which is a challenging proposition.
DM: It is. Even financial literacy and just that type of education in high schools. People aren’t seeing that as a path, don’t even know what it is. Hopefully they at least see it in college. But a lot of times, you know, they don’t see it before that.
GI: What do you see as some other big challenges for the industry?
DM: We have more demand than we have supply of financial planners. And so that’s where for me it’s like, OK, we’ve got to get people more aware of financial planning, get them into the profession in order to meet the demands of the consumer.

GI: How have pandemic-related disruptions affected to the normal course of business for advisors and clients?
DM: I think it’s changing how planners are doing what they do. There’s a lot more remote work, hybrid setups, which is really opening up where people can live and work. I think that dynamic is probably going to continue. We can’t replace being in-person, so the in-person pieces will start coming back.
GI: As advisors and planners have done stuff more digitally there are probably some opportunities and challenges that come along with that. Like, you could reach more clients but other advisors could reach into your geographic market, too.
DM: I think the tools are there to make some of that reach a little bit stronger than it was before. But it’s got to be tied back to the service and the value [planners] provide.

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Take a look at some of the biggest movers in the premarket:
Monster Beverage (MNST), Constellation Brands (STZ) – Merger talks between Monster Beverage and Constellation Brands are progressing, according to people familiar with the matter who spoke to Bloomberg. Those people say an agreement between the two companies could be reached within weeks if the talks go smoothly. Constellation gained 2.2% in the premarket while Monster Beverage rallied 3.1%.

Arista Networks (ANET) – Arista Networks reported quarterly earnings of 82 cents per share, 9 cents a share above estimates. The networking software and services company’s revenue topped Wall Street forecasts as well. Arista also issued an upbeat forecast, helping its shares surge 10.1% in the premarket.
Restaurant Brands (QSR) – The restaurant operator beat estimates by 4 cents a share, with quarterly earnings of 74 cents per share. Revenue came in above estimates as well. Burger King’s comparable-store sales beat analysts’ forecasts, helping to offset misses at the Tim Hortons and Popeyes chains.
BorgWarner (BWA) – The automotive components maker reported quarterly profit of $1.06 per share, well above the 75 cents a share consensus estimate. Revenue also came in above forecasts. BorgWarner’s full-year earnings forecast is shy of analysts’ estimates, however, despite an expected improvement in organic sales. BorgWarner rose 1% in premarket trading.
Marriott (MAR) – Marriott shares jumped 3% in the premarket after the hotel operator beat top- and bottom-line forecasts for its latest quarter. Marriott earned $1.30 per share, 31 cents a share above estimates as occupancy rates increased amid a rise in vaccinations.
Zoetis (ZTS) – Zoetis was up 2% in premarket trading on better-than-expected quarterly results. Zoetis beat estimates by 4 cents a share, with quarterly earnings of $1.00 per share as improvement in its pet products business offset tepid results for livestock product sales.

Tower Semiconductor (TSEM) – Intel (INTC) announced a deal to buy the Israeli chipmaker for $53 per share, or $5.4 billion, a 60% premium over Tower’s Monday closing price. Tower makes chips for a wide variety of industries including medical, automotive and consumer products. Tower Semiconductor soared 44.6% in premarket action, while Intel added 1.6%.
Advance Auto Parts (AAP) – Advance Auto Parts beat estimates by 10 cents a share, with quarterly profit of $2.07 per share. The auto parts retailer’s revenue also beat analysts’ forecasts. Advance Auto’s sales were higher than a year before, but profit was lower as it dealt with inflationary headwinds. Shares fell 1% in premarket action.
Avis Budget (CAR) – The company reported better-than-expected profit and revenue for its latest quarter, as increases in rental activity and in revenue per day helped offset higher expenses.
Intuit (INTU) – Intuit lowered its current-quarter forecast as tax season gets off to a slow start. The maker of the popular TurboTax software maintained its full-year forecast, however, suggesting the company believes revenue was simply be pushed to a later quarter. Intuit fell 1% in premarket trading.

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As of Jan. 19, there were eight metaverse ETFs listed in South Korea, drawing over $1 billion in inflows, according to data from Samsung Asset Management, which launched two of the ETFs.
More than 70% of the inflows into both domestic and global metaverse ETFs in South Korea are from retail investors, according to the data.
Top holdings in the ETFs include tech companies and chipmakers as well as stocks associated with South Korea’s entertainment industry.
The K-pop industry, with its global popularity, is expected to play an “integral” role in developing the metaverse, says Rahul Sen Sharma, managing partner of index provider Indxx.

An attendee takes a selfie as she experiences an ‘extreme sumarine 4D simulation’ with immersive VR by SK telecom during the second day of the annual Mobile World Congress.
Matthias Oesterle | Corbis News | Getty Images

Metaverse exchange-traded funds are booming in South Korea as retail investors buy into funds focused on tech’s new frontier.
The metaverse refers broadly to a virtual world where humans interact through three-dimensional avatars. In the metaverse, users can engage in activities like gaming, concerts or live sports using virtual reality headsets like Oculus.

South Korea’s metaverse ETFs were the first to launch in Asia as the buzz around the next generation of the internet grew last year. ETFs are a basket of stocks or bonds that broadly track market indices, and offer investors more diversification.
South Korea’s first four metaverse ETFs launched in October and drew inflows of $100 million in just under two weeks, according to Rahul Sen Sharma, managing partner of index provider Indxx.
South Korea isn’t alone though. Metaverse ETFs have also been cropping up in the U.S. and analysts noted more will launch soon.
As of Jan. 19, there were eight metaverse ETFs listed in South Korea, drawing over $1 billion in inflows, according to data from Samsung Asset Management, which launched two of the ETFs.
Of that amount, over $800 million has gone into four ETFs focused on South Korean metaverse-related stocks, while more than $338 million has been funneled into more global metaverse ETFs, the data showed.

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Some of the ETFs include Samsung Asset Management’s KODEX K-Metaverse Active, NH Amundi Asset Management’s Hanaro Fn K-Metaverse MZ, KB Asset Management’s KBSTAR iSelect Metaverse and Mirae Asset Global Investment’s Tiger Fn Metaverse.
Top holdings in the ETFs include tech companies and chipmakers as well as stocks associated with South Korea’s entertainment industry. Samsung’s metaverse ETF, for instance, includes shares of Hybe, which owns the music label for hugely popular K-pop group BTS, as well as video game makers such as Pearl Abyss.
Indxx’s Sharma said the K-pop industry, with its global popularity, is expected to play an “integral” role in developing the metaverse. He noted a number of recent announcements related to K-pop metaverse infrastructure projects and non-fungible tokens. NFTs are digital tokens that represent proof of ownership of assets such as art, collectibles or memes. K-pop groups and labels have launched NFT merchandise and have also held concerts and fan events in the metaverse, according to media reports.

Retail investing power

As metaverse ETFs launch in South Korea, retail interest has followed. More than 70% of the inflows into both domestic and global metaverse ETFs in South Korea are from retail investors, according to the Samsung Asset Management data.
“The metaverse is touted as one of the most talked-about key topics of 2021 in South Korea,” said Sharma from Indxx.
“These high fund flow numbers represent a generally positive outlook towards the metaverse theme, additional to the developments that illustrate the growing popularity among the citizens and the government of South Korea,” Sharma said.
Sharma said retail investors in Asia-Pacific have been driving growth within ETFs more broadly. He noted the number of Australian retail investors in ETFs surged 33% last year.
Sharma, citing a recent Euroclear report, said demand in Asia-Pacific for ETFs is set to rise from $1.5 trillion to $5 trillion over the next five years.

In contrast, U.S. retail investor ownership of ETFs has slipped behind that of institutional investors. Investment advisors now own nearly 40% of U.S.-listed ETFs, compared with just over 35% five years ago, according to data from Citi. Meanwhile retail ownership has slipped from 40% five years ago to 38.5% now.
Overall, institutional investors still eclipse retail investors when it comes to total trading volume. While in the U.S., retail investors make up about a quarter of trading activity, they constitute just 5% to 7% of Europe’s total trading volume, according to Vanda Research. In China, retail participation is over 60%.

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BlockFi has agreed to pay $100 million to the SEC and 32 states to settle charges related to its retail crypto lending product.
The service, BlockFi Interest Accounts, let users accrue interest on holdings of bitcoin and other cryptocurrencies.
BlockFi says it is now applying to register with the SEC to offer a new crypto savings product called BlockFi Yield.

The logo of cryptocurrency platform BlockFi.
Budrul Chukrut | SOPA Images | LightRocket via Getty Images

Cryptocurrency firm BlockFi said Monday it has agreed to pay $100 million to the U.S. Securities and Exchange Commission and several states to settle charges related to its popular crypto lending product.
BlockFi, which is backed by Silicon Valley investor Peter Thiel, touts itself as a banklike platform for crypto users. The company offers a popular savings product that lets clients accrue interest on their digital currency holdings.

BlockFi advertises annual percentage yields as high as 9.25% on its website, much higher than the average savings rates on offer from incumbent financial institutions. The firm says it is able to offer such rates as large institutional investors are willing to pay more to borrow the deposits.
Bitcoin and other digital assets are not regulated, however, and authorities have grown concerned by a lack of oversight for crypto-related services that more closely resemble traditional financial products that are regulated.
The SEC said Monday it had charged BlockFi with failing to register its retail crypto lending product, BlockFi Interest Accounts, and with violating the registration provisions of the Investment Company Act of 1940.
BlockFi agreed to pay the SEC $50 million to settle the charges, without admitting or denying wrongdoing or liability. It will also pay a further $50 million to 32 states over similar charges.
“This is the first case of its kind with respect to crypto lending platforms,” SEC Chair Gary Gensler said. “Today’s settlement makes clear that crypto markets must comply with time-tested securities laws.”

Following the settlement, BlockFi said U.S. customers will no longer be able to open new interest accounts with the firm. Clients can continue receiving interest on their existing holdings, but cannot add new assets to their accounts, the company said.
BlockFi says it is now applying to register with the SEC to offer a new crypto savings product called BlockFi Yield. The company added it intends to eventually move existing U.S. users over to the new service, unless they decide against it. BlockFi said the move provides “regulatory clarity” for the industry.
“From the day we started BlockFi, we have always known that strong engagement with regulators would be critical for the adoption of financial services powered by cryptocurrencies,” BlockFi CEO and founder Zac Prince said in a statement.
“Today’s milestone is yet another example of our pioneering efforts in securing regulatory clarity for the broader industry and our clients, just as we did for our first product — the crypto-backed loan,” he added.
The SEC also issued a warning to other crypto lenders that offer services like BlockFi’s, with Gurbir S. Grewal, director of the agency’s enforcement division, saying they “should take immediate notice of today’s resolution and come into compliance with the federal securities laws.”
The watchdog is reportedly scrutinizing Celsius, Gemini and Voyager Digital as part of an inquiry into crypto lending practices, according to Bloomberg. All three firms said they are cooperating with regulators.
Last year, Coinbase shelved plans to launch its own interest-earning crypto product after the SEC threatened to sue the company. The crypto exchange’s CEO, Brian Armstrong, got into a public spat with the watchdog, accusing it on Twitter of “sketchy behavior.”
Founded in 2017, BlockFi has raised a total of over $500 million in venture funding to date, according to CB Insights data, and was last privately valued at $3 billion.

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Advice and the Advisor

Sixty-eight percent of “fund selectors” don’t think individuals should have access to cryptocurrency, according to a Natixis Investment Managers survey.
Fund selectors oversee the investments available to customers at brokerage houses, financial advisory shops, private banks and other firms.
The popularity of bitcoin, ethereum and other digital coins has grown significantly over the past year or so.

A Bitcoin ATM is seen inside a gas station in Los Angeles on June 24, 2021.
CHRIS DELMAS | AFP | Getty Images

Roughly two out of three “fund selectors” don’t think individual investors should own cryptocurrency in their portfolios, largely for reasons related to transparency and regulation, according to a Natixis Investment Managers survey.
Fund selectors at brokerage houses, financial advisory shops, private banks and other institutions analyze and choose the investments their firms offer customers.

Sixty-eight percent don’t think individuals should have access to crypto, according to the survey, which polled 141 U.S. investment executives at firms that manage $2.7 trillion in client assets.

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However, that sentiment is butting up against high demand for digital currencies like bitcoin and ethereum, especially among younger investors — 40% of survey respondents say clients are increasingly asking for crypto access.
More than 10% of investors own crypto, ranking the digital coins behind real estate, stocks, mutual funds and bonds, according to a CNBC survey published in August. Two-thirds of them bought in over the last year, largely because of how easy it’s become to trade the assets.

Meanwhile, crypto exchanges marketed heavily during the Super Bowl on Sunday. Proponents like Tesla and SpaceX CEO Elon Musk have also helped fuel investor enthusiasm.
And financial firms continue to add ways for investors to buy into the digital frenzy. The first exchange-traded funds linked to the price of bitcoin futures debuted in October.

Crypto reluctance

But investment professionals’ reluctance is largely due to challenges they see relative to crypto transparency and an apparent lack of regulation, according to Dave Goodsell, executive director of the Natixis Center for Investor Insight.
About 87% agreed crypto assets need to be more transparent, and 84% think they will need some type of regulatory oversight, according to the firm’s survey published Tuesday.
“I think that makes it challenging to recommend such things if they’re in a fiduciary role,” Goodsell said, referencing the legal duty some firms owe their clients. “I think that’s where the hesitancy comes from.”

About 70% also conceded their firm needs more education in digital assets and cryptocurrencies before investing in them.
Crypto hesitancy extends beyond fund selectors, though.
Sen. Elizabeth Warren, D-Mass., said during a Senate Banking Committee hearing in July that crypto “puts the [U.S. financial] system at the whims of some shadowy, faceless group of super coders and miners.”
However, at the same hearing, Sen. Cynthia Lummis, R-Wyo., touted the transparency and openness of open-source finance as a way to promote financial inclusion.
Financial advisors generally don’t recommend clients allocate more than a small part of their investment portfolio to crypto, given its volatility. Bitcoin prices have fallen to around $43,000 per coin from their recent $67,000 high in November.   More

Traders on the floor of the NYSE, Feb. 4, 2022.
Source: NYSE

U.S. stock futures rose slightly Monday night, as traders kept an eye on simmering tensions between Russia and Ukraine while weighing the potential impact of tighter monetary policy from the Federal Reserve.
Futures tied to the Dow Jones Industrial Average climbed 34 points, or 0.1%.. S&P 500 futures rose 0.2%, and Nasdaq 100 futures advanced 0.3%.

Wall Street is coming off a volatile trading session.
The Dow closed lower by 171.89 points, or 0.5%, after falling more than 400 points at one point. The S&P 500 dropped as much as 1.2% before ending the day 0.4% lower. The Nasdaq Composite fell 0.9% at one point before closing just below the flatline.
Oil, meanwhile, popped to its highest level since September 2014 on Monday, while gold futures reached levels not seen since Nov. 16.
Those moves came as the Russia-Ukraine conflict appeared to escalate. Secretary of State Antony Blinken ordered the closing of the U.S. embassy in Kyiv, Ukraine, citing a “dramatic acceleration in the buildup of Russian forces” on Ukraine’s border.
“Investors are on edge with geopolitical tensions high and crude oil flirting with $100 a barrel, but after the wild ride on Friday, today’s flattish day really feels like a win,” LPL Financial chief market strategist Ryan Detrick said.

Concerns over multiple Fed rate hikes also kept investors on edge.
St. Louis Fed President James Bullard told CNBC’s Steve Liesman on Monday that the central bank needs to be aggressive in fighting inflation. The consumer price index rose last month at its fastest year-over-year pace since 1982, leading Citigroup and Goldman Sachs to increase their rate hike outlook for 2022 seven.
“I do think we need to front-load more of our planned removal of accommodation than we would have previously. We’ve been surprised to the upside on inflation. This is a lot of inflation,” Bullard said.
“Our credibility is on the line here and we do have to react to the data,” he added. “However, I do think we can do it in a way that’s organized and not disruptive to markets.”

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LPL’s Detrick said that, while investors should be concerned about inflationary pressures and tighter U.S. monetary policy, the market’s fundamental backdrop remains strong.
“Yes, Fed hikes are coming, inflation is out of control, and geopolitical tensions are high, yet let’s not forget that we are about to wrap up another extremely solid earnings season,” he said. “There are a lot of worries out there, but to see really strong earnings last quarter, along with companies overall quite optimistic about our economy’s future, this is something that should give investors hope.”
More than 70% of S&P 500 companies have posted their latest quarterly results, with 77% of those names beating analyst expectations, according to FactSet. Earnings for those companies have grown by about 30% on a year-over-year basis.
—CNBC’s Maggie Fitzgerald contributed to this report.
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People wait in line at Avis rental agency in the Miami International Airport Car Rental Center on April 12, 2021 in Miami, Florida.
Joe Raedle | Getty Images

Check out the companies making headlines after the bell Monday:
Avis Budget — Avis shares dipped slightly even after the car rental company posted a quarterly profit that beat analyst expectations. The company earned an adjusted $7.08 per share in its latest quarter, topping a Refinitiv estimate of $6.15 per share.

Arista Networks — Shares of Arista Networks popped more than 8% on the back of better-than-expected quarterly results. The company posted an adjusted profit of 82 cents per share on revenue of $824.5 million. Analysts expected earnings of 74 cents per share on revenue of $790.1 million, according to StreetAccount. Arista also issued first-quarter revenue guidance that was above analyst forecasts.
Brookdale Senior Living — The retirement home operator reported a fourth-quarter EBITDA of $35.8 million, narrowly missing a StreetAccount forecast of $36.2 million. The company’s revenue for the quarter came in at $643.9 million, marginally above estimates. Shares fell slightly.

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Weber, which plans to trade on the New York Stock Exchange under the ticker ‘WEBR’ could be valued between $4 billion and $6 billion.
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Check out the companies making headlines in midday trading.
Weber – Shares of the grill maker tumbled 8.7% midday after the company missed Wall Street estimates in its latest quarterly report, but closed up 1.5%. Weber posted a loss of 19 cents per share, versus the Refinitiv consensus 7-cent loss. Revenue also missed forecasts.

Rivian – The electric truck maker’s stock rose 6.5% after Soros Fund Management reported it bought nearly 20 million shares during the fourth quarter. The stake was worth about $2 billion at the time of purchase, although its value has fallen to about $1.17 billion.
3M – Shares fell about 1% after the respirator manufacturer said demand for medical masks is expected to wane this year. Bloomberg on Sunday also reported the company’s legal woes add up to a $33 billion discount to 3M’s peers.
Splunk – Shares of the cloud software company jumped 9.1% after the Wall Street Journal reported Cisco Systems made a more than $20 billion takeover bid, citing people familiar with the matter. A deal of that size would represent the networking equipment maker’s largest-ever acquisition.
Aerojet Rocketdyne — The stock fell 5.6% after defense contractor Lockheed Martin abandoned a $4.4 billion acquisition of the rocket motor builder. Federal regulators had sued to block the transaction in January due to concerns that the combination would be anti-competitive.
Tyson Foods – Shares dropped 3.2% on Monday after Barclays downgraded the animal protein stock to equal weight from overweight. The firm said that strong results for beef and chicken sales were already priced in to the stock.

Micron – The chipmaker rose 1.8% midday, but closed marginally higher after Wedbush upgraded Micron to outperform from neutral. The investment firm said that Micron should benefit from stronger pricing for one of its key chip products in 2022.
Goodyear Tire – Shares rallied about 1.6% on Monday after JPMorgan upgraded the stock to overweight from neutral. The call comes after the tire maker’s stock sank 27% on Friday as the company warned of inflation headwinds. “Overall, the sell-off strikes us as an overreaction,” JPMorgan said.
Callaway Golf – The stock added 3% after investment firm Stephens named the Topgolf parent a top pick. “We believe that Callaway has a number of catalysts ahead of it, with an analyst day upcoming in 2Q, an improving supply chain, and Topgolf traffic improving through 1Q,” Stephens said.
— CNBC’s Tanaya Macheel, Jesse Pound, Yun Li contributed reporting.

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