Morningstar Wealth Adds SMAs from Leading Asset Managers to the U.S. Wealth Platform

Rhea-AI Summary

Morningstar Wealth, a division of Morningstar, Inc., has integrated third-party Separately Managed Accounts (SMAs) into its U.S. Wealth Platform, offering enhanced flexibility to advisors and clients. Leading asset management firms like AllianceBernstein and Lazard Asset Management are part of this curated selection, empowering advisors to build tailored portfolios and unified managed accounts.

Insights

Market Research Analyst

The integration of third-party Separately Managed Accounts (SMAs) into Morningstar's U.S. Wealth Platform signifies a strategic move to diversify and enhance investment offerings. SMAs are individual investment portfolios managed by professional asset managers, tailored to the specific needs of investors. The inclusion of SMAs from reputable firms such as AllianceBernstein and Lazard Asset Management broadens the scope for advisors to customize investment solutions, which could potentially attract a wider client base seeking personalized portfolio management.

From a market perspective, the growth of SMAs, with assets doubling since 2019, reflects a shift towards more individualized investment strategies over traditional mutual funds or ETFs. This trend aligns with the increasing demand for personalized financial advice and investment products that can adapt to unique investor profiles. As Morningstar Wealth integrates these options, it could see enhanced platform utilization and potentially increase its competitive edge within the wealth management industry.

Financial Analyst

The announcement from Morningstar Wealth could have implications for its parent company's financial performance. By expanding the range of investment choices, Morningstar is likely aiming to increase the assets under management (AUM) on its platform, which is a critical revenue driver for wealth management firms. The addition of SMAs from six leading asset management firms could improve the attractiveness of the platform to advisors, potentially leading to an uptick in AUM.

Furthermore, the projected growth of SMAs to $3 trillion suggests that Morningstar is capitalizing on a growing segment, which could lead to increased market share and revenue in the future. Investors and stakeholders should monitor the adoption rate of these new SMAs and the subsequent impact on Morningstar's financial metrics, such as AUM growth, client acquisition rates and overall platform performance.

Economist

The expansion into SMAs by Morningstar Wealth is indicative of broader economic trends within the investment sector. The doubling of SMA assets since 2019 can be tied to the macroeconomic environment, where investors are seeking more control over their investments amidst market volatility and uncertainty. This shift towards SMAs may also be reflective of a larger demographic trend where wealth is being transferred to younger, more financially savvy generations who favor customization and direct involvement in their investment choices.

The long-term economic impact of this shift could result in a reallocation of capital within the financial markets, as funds flow from traditional investment vehicles into SMAs. The increased demand for such personalized investment solutions could also drive innovation in financial services, leading to the development of new products and technologies that cater to bespoke investment needs.

Integrating Company Research and Evaluation Processes to Curate Investment Choices

CHICAGO, Feb. 12, 2024 /PRNewswire/ -- Morningstar Wealth, a division of Morningstar, Inc. (Nasdaq: MORN) today announced the addition of third-party Separately Managed Accounts (SMAs) to its Morningstar U.S. Wealth Platform, after undergoing a rigorous selection process. This expansion offers increased flexibility and choice to advisors and their clients, elevating the advisor-investor experience.

The newly added third-party SMAs have been curated from leading asset management firms including AllianceBernstein, Congress Asset Management, John Hancock Investment Management, Lazard Asset Management, Putnam Investments, and WCM Investment Management. These additions expand the range of investment choices advisors have to build portfolios and holistic unified managed accounts (UMAs), tailored to their clients' specific goals and objectives. 

"Morningstar's dedication to empowering advisors is core to why we implemented a manager selection process leveraging our renowned manager research team to provide a curated selection of investments available on the Wealth Platform," said Cindy Galiano, managing director of U.S. Wealth Platform & Investment Solutions at Morningstar Wealth. "Here, advisors can readily access vetted investment options to best serve their clients, eliminating the need to navigate a vast marketplace."

SMAs have witnessed substantial growth in the investment landscape, doubling their assets under management to nearly $2 trillion since 2019. This growth trend is expected to persist, with SMAs projected to reach $3 trillion in the near future, according to Cerulli Associates.

For more information about Morningstar Wealth Platform and its expanded investment offering, please visit mp.morningstar.com.

About Morningstar Wealth

Morningstar Wealth is a global organization dedicated to empowering both advisors and investor success. Our extensive range of offerings includes Morningstar Wealth Platform (turnkey asset management program), model portfolios managed by Morningstar Investment Management ($264 billion in assets under management and advisement), Morningstar Office (portfolio management software), ByAllAccounts (data aggregation and enrichment), Morningstar Investor (individual investor platform) and Morningstar.com.

Morningstar's Manager Due Diligence and Selection Services

Manager Due Diligence and Selection Services are offered by Morningstar Research Services LLC, a subsidiary of Morningstar, Inc. Investment research is produced and issued by subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research Services LLC, registered with the U.S. Securities and Exchange Commission. Manager Due Diligence and Selection Services provides investment consulting services to Institutional Clients on a non-discretionary basis, with the Institutional Clients having final decision-making authority on whether to follow the recommendation(s) or not.

About Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment insights in North America, Europe, Australia, and Asia. The Company offers an extensive line of products and services for individual investors, financial advisors, asset managers and owners, retirement plan providers and sponsors, and institutional investors in the debt and private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately $264 billion in assets under advisement and management as of Sept. 30, 2023. The Company operates through wholly- or majority-owned subsidiaries in 32 countries. For more information, visit http://www.morningstar.com/company. Follow Morningstar on Twitter @MorningstarInc.

MORN-P

Media Contact:
Elizabeth Durkee, +1 312 696-6037 or newsroom@morningstar.com

 

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SOURCE Morningstar, Inc.

FAQ

What did Morningstar Wealth announce regarding its U.S. Wealth Platform?

Morningstar Wealth integrated third-party Separately Managed Accounts (SMAs) into its U.S. Wealth Platform, providing increased flexibility and choice to advisors and clients.

Which asset management firms are part of the newly added third-party SMAs?

Leading asset management firms like AllianceBernstein, Lazard Asset Management, and others have been curated as part of the third-party SMAs on Morningstar's U.S. Wealth Platform.

What is the expected growth trend for SMAs in the investment landscape?

SMAs have doubled their assets under management to nearly $2 trillion since 2019 and are projected to reach $3 trillion in the near future, according to Cerulli Associates.