Why Active Management Spells Disaster For Retirees: Financial Advisors’ Daily Digest

Fidelity Contrafund (MUTF: FCNTX ), despite its generally positive reputation, represents a risk that retirees cannot afford to take in the opinion of Seeking Alpha contributor Eric Nelson, an advisor with Servo Wealth Management. The essential problem is that retirees have just one chance to get it right, and can’t afford the risks of style drift or underperformance that any active manager presents. Better to arm yourself with small- and value-tilted index funds, and critically, an advisor who will prevent client drift at just the wrong time, Nelson argues. We’d love to hear your thoughts on all this, in the comments section below. Note to readers: Financial Advisors’ Daily Digest will not be published on Thursday. But we’ve got a few extra links of advisor-related stories to hold you till Friday:

Amazon, Comcast Content Delivery Network Push Could Hurt Akamai

Comcast ( CMCSA ) and Amazon Web Services, part of Amazon.com ( AMZN ), are becoming bigger players in the content delivery network market, posing a challenge to CDN leader Akamai Technologies ( AKAM ), according to Goldman Sachs. CDNs increase the speed of e-commerce transactions, business software downloads and video streaming to mobile devices. “Amazon is growing its Cloudfront CDN to an estimated $1.8 billion in 2016 revenues and shifting its own video delivery from independent CDNs to its own network, and startups like Fastly are growing share,” Goldman Sachs analyst Heather Bellini said in a research report. AWS is part of the e-commerce giant’s fast-growing cloud computing business. Amazon stock surged to an all-time high  on Tuesday, as the Wall Street Journal reported that Salesforce.com ( CRM ) was building a new service that uses AWS. AWS was a big reason Amazon reported its highest sales growth in nearly four years when it posted first-quarter earnings on April 28, sending the stock up nearly 10% the following day. Amazon is an IBD Leaderboard stock, with a strong IBD Composite Rating of 95, where 99 is highest. Akamai has a 59 CR. Bellini, who has a sell rating on Akamai stock, attended the 2016 Content Delivery Summit in New York on Monday, gaining views on market trends. “A key takeaway was that the competitive landscape remains intense, as Comcast looks to triple its CDN capacity next year,” wrote Bellini. Comcast, the No. 1 cable TV company, has been expanding commercial services to businesses. Comcast  moved into CDN services in late 2014, Bellini noted. One market trend could work in Comcast’s favor, said the Goldman Sachs analyst. “Multi-CDN deployments were a key theme of the conference,” she wrote, “with new startups making it easy to route traffic across multiple CDNs.” Cambridge, Mass.-based Akamai is the No. 1 provider of CDN services. Worries that big customers such as  Apple ( AAPL ) and  Facebook ( FB ) are shifting more of their data traffic to their own CDNs have pressured Akamai stock. Aside from AWS and Comcast, Akamai competes with  Level 3 Communications ( LVLT ),  Limelight Networks ( LLNW ), and Verizon Communications ( VZ ), as well as startups Fastly and CloudFlare.