Jennison Associates Review

Disciplinary Questions

After checking the disciplinary records of Jennison Associates, our system found no disciplinary questions to ask. Checks take place monthly.

Conflict Questions

After checking the regulatory records of Jennison Associates, our system has identified the following question(s) to ask. Learn more.

Is Jennison Associates also a Broker-Dealer or are they affiliated with one? What conflicts arise from this relationship? How does Jennison Associates mitigate them?

Currently Jennison Associates is also a Broker-Dealer or is affiliated with one. When firms are dual-registered as broker-dealers, they may be subject to compensation-related conflicts of interest, including revenue sharing from mutual funds, cross-selling of commissioned insurance products, and the sale of proprietary investment products. All of these conflicts can negatively impact clients via hidden fees and overall higher costs.

Does Jennison Associates offer mutual funds that have 12b-1 fees?

12b-1 fees increase the total annual cost of owning a mutual fund with no guarantee of higher returns. Some firms receive these fees as payments, which creates an incentive to promote them.

Regulatory disclosures state that Jennison Associates sells proprietary investments and products. Please provide me a list of the products and a summary of how much Jennison Associates earns from them.

Jennison Associates recommends proprietary investments and products that could generate larger commissions than other similar non-proprietary products. This could also limit the number and diversity of investment options available to you and may impact their transferability. Do not be afraid to ask how much they will earn from the product or what other non-proprietary options are available.

Does Jennison Associates offer products that have performance-based fees, or does it accept performance-based fees? Will any of my assets be invested in those products?

When performance-based fees are charged, the financial advisor is paid for outperforming a benchmark, typically an index. While this may seem like an attractive compensation structure to ensure your advisor is making your money work for you, often, the managers of those products are incentivized to take inappropriate risks to beat their performance benchmark. For instance, research has shown that mutual funds that use incentive fees take on more risk that funds that do not, and tend to double down and increase their risk following a poor performance. This could be detrimental to a client during down markets.

Does Jennison Associates perform side-by-side management? How does Jennison Associates mitigate conflicts that arise from managing accounts with differing fee structures?

This typically occurs when firms manage mutual funds or hedge funds alongside smaller retail accounts. Side-by-side management can create an incentive for the advisor to favor the larger funds, potentially leading to unequal trading costs and unfavorable trade executions for their retail clients.

Does Jennison Associates recommend securities that it or its affiliates underwrite, or in which it serves as general or managing partner? Will any of my assets be invested in those products?

Jennison Associates recommends securities that they may have recently taken public or otherwise have controlling interest over. This relationship could introduce bias where a firm and its advisors may push those products over others that may have a more favorable performance with which they are not affiliated.

Does Jennison Associates accept soft-dollar benefits? How do these benefits affect the firm’s selection of a broker-dealer partner?

Jennison Associates receives soft-dollar benefits that could incentivize them to push trades through broker-dealers that provide advantages to the firm instead of through broker-dealers that could provide the best trade execution for their clients.

Which securities does Jennison Associates trade for itself that it will also be recommending to me?

Jennison Associates has marked in their disclosures that they trade recommended securities. While this often can be seen as "eating your own cooking," there are several inherent conflicts that can arise. For example, front running is when a financial professional buys or sell securities ahead of their client. In short, any financial professional should disclose all positions they hold (or have sold short) that they will also be recommending to you.

Our system found no other conflict questions to ask. Checks take place monthly.