Lawrence Calcano, Chairman and CEO of iCapital, and Jaime Magyera, Co-Head of US Wealth Business and Senior Sponsor for Retirement Business at BlackRock, joined Julie Cooling, Founder and CEO of RIA Channel, discuss the launch of a first-of-its-kind partnership that provides customizable model portfolios using both private and public market assets through a Unified Managed Account (UMA). The two leaders say that this will significantly streamline administration and custodial integration for advisors.
Previously, it was complicated for advisors to access public markets on one platform and private markets on a second platform. In this new partnership combining BlackRock’s models, GeoWealth’s UMA platform, and iCapital’s technology that accesses and administers private market investments, public and private market investments can now be held in a single UMA. BlackRock will provide customizable model portfolios that allocate across both public and private markets. The partnership provides advisors tools to build better and more customized outcomes for clients.
Advisors are very active users of models in their existing portfolios. It is easier for advisors when a single model integrates allocations to alternative and liquid public investments. Advisor adoption can accelerate when they have easier access to the complete range of investment options. Offering clients the ability to easily access a wide range of investments can also enhance the growth of an advisor’s practice.
Over ten years, model portfolios increased from nonexistent to $5 trillion in assets, with Magyera expecting assets to double in the next few years. The growth in model portfolios comes from the scale and efficiency they can provide to an advisor’s practice. Efficiencies in an advisor’s business provide more time to spend with clients and prospects. To date, models have been deployed in the publicly traded portion of client portfolios. When models integrate alternatives into portfolios, it is easier for clients to see the value of alternatives and their role in portfolios.
Resources: