Vestmark Announces New Strategic Partnership to Support Rapidly Expanding RIA Channel
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Insights
The partnership between Vestmark, Inc. and Invesco Ltd. represents a strategic move to enhance the services offered to Registered Investment Advisors (RIAs). The integration of Invesco's investment models with Vestmark's tax optimization platform, VAST, is poised to deliver a unique value proposition in the wealth management software market. The key highlight is the ability to create personalized, tax-optimized portfolios at scale, which addresses a growing demand for customized investment solutions that also consider tax implications.
From a market perspective, this collaboration could potentially increase the competitive edge for both firms by expanding their market share within the RIA channel. The synergy between Invesco's investment expertise and Vestmark's technological capabilities could attract new RIAs and retain existing clients, ultimately impacting the revenue growth of both entities. Additionally, the emphasis on cost-effectiveness and adaptability to market conditions may resonate with investors seeking efficient and flexible investment strategies in a dynamic financial landscape.
The announcement of this partnership is likely to have a positive effect on the stock market perception of both Vestmark and Invesco. Investors and analysts often view strategic partnerships that expand service offerings and address market demands favorably. The focus on tax management services is particularly relevant given the current economic climate where investors are looking for ways to maximize after-tax returns.
Financially, the collaboration could lead to improved profit margins for both companies through increased efficiencies and potentially higher assets under management (AUM) as RIAs leverage these new tools. Furthermore, the ability to seamlessly transition legacy positions with tax efficiency could reduce client churn and foster long-term loyalty, which is a critical factor in assessing the future cash flows and valuation of firms in the wealth management sector.
The introduction of Vestmark VAST's tax management services is a significant development for RIAs who are increasingly focusing on tax optimization as a critical component of wealth management. The ability to personalize portfolios while managing the tax impact of investment decisions can be a differentiator in attracting high-net-worth clients who are particularly sensitive to tax implications.
By offering tax-efficient transitioning of legacy positions, Vestmark addresses a common pain point for investors changing advisors or consolidating assets. This service could lead to both client acquisition and retention, as it simplifies a traditionally complex process. For RIAs, this means an enhanced ability to provide value-added services without the need for significant investment in in-house tax expertise or technology, potentially leading to operational cost savings and improved profitability.
Vestmark VAST® to help deepen presence among RIAs with custom model portfolios and tax management services.
Karl Roessner, Chief Executive Officer at Vestmark, welcomed the partnership, saying, "This partnership marks a significant step toward providing RIAs with innovative portfolio solutions, combining Invesco's investment experience with Vestmark's breakthrough tax transition and tax management service, VAST. We are confident that this strategic partnership will be a game-changer in the RIA channel."
Vestmark VAST simplifies the creation of personalized tax-optimized portfolios for financial advisors at scale. Designed to meet advisors and clients where they are, VAST enables the creation of tailored, tax optimized portfolios aligned to each client's personal situation. Vestmark's tax transition service also helps to ensure the tax-efficient transition of legacy positions from other accounts or firms.
Backed by Invesco Investment Solutions and offering a multi-manager approach, Invesco's custom model portfolios are supported by ongoing marketing insights, helping ensure adaptability to evolving market conditions. The portfolios provide investors with multi-asset solutions, offering diversification across investment managers and factors while maintaining cost-effectiveness.
About Vestmark
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Investment strategies that seek to enhance after-tax performance may be unable to fully realize strategic gains or harvest losses. There are limitations inherent in the use of an optimization methodology to manage accounts relative to a designated index; for instance, the optimization tools are not designed to account for current market conditions and any short-term market fluctuations. The optimization tools may seek to estimate individual tax circumstances but cannot incorporate all individual tax information, potentially leading to inaccuracies.
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SOURCE Vestmark
FAQ
What is the partnership between Vestmark and Invesco about?
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