Fidelity Expands SMA Lineup for Advisors
Fidelity Investments announced the addition of six new custom strategies and two new models to its SMA lineup for RIAs and broker/dealers. In addition, Fidelity launched new equity model SMAs that can be integrated into UMAs to offer a tax-efficient approach to portfolio management.
The firm’s Institutional Tax-Managed Enhanced Equity and Institutional Tax-Managed Fundamental Equity custom SMAs each feature actively managed large cap core, growth and value strategies. The enhanced equity strategies are benchmark-aware and leverage a diverse set of alpha insights. The fundamental equity strategies rely on a systematic portfolio construction process and high conviction stock selection.
The strategies are now available to RIAs via Fidelity’s custom SMA platform, which is integrated with the firm’s Wealthscape program. The new equity model SMAs include Fidelity Institutional Blue Chip Growth Focused Model SMA and Fidelity Institutional Small Growth Focused Model SMA.
Fidelity currently offers eight active equity model-delivered SMAs across domestic equity, sector and international equity strategies. It also has five factor and two index model SMAs available via Fidelity Managed Account Xchange and some third-party platforms.
“Demand for a personalized investing experience continues to grow, particularly among ultra-high-net-worth investors, a population that has grown by more than 40% in the past decade. We’ve consistently expanded the range of investment capabilities available to advisors serving those who are looking for a more bespoke experience,” Amanda Robinson, head of wealth advisory managed solutions distribution at Fidelity Investments, said in a statement.
The ability to integrate model portfolios and other strategies with UMAs is becoming increasingly more important for asset managers and custodians serving financial advisors. Cerulli Associates reported that over the five years ending in 2024, UMAs were the fastest-growing part of the managed account universe, growing at a compounded annual rate of 18.7%.
According to the most recent data from research firm Cerulli Associates, over the five years ending in 2024, UMAs experienced a compounded annual growth rate of 18.7%, reaching $257.7 billion in net flows, the highest level in the managed account universe. Model portfolios have also experienced double-digit growth in recent years, with fintech firm Broadridge Financial Solutions projecting they will hit $18.6 trillion by 2030. Advisors are particularly drawn to custom model portfolios, according to Morningstar, with a lack of customization among the two top reasons cited by advisors for not using models.
