─ Demand for Managed Accounts Rises as Firms
Increasingly Transition to More Fee-Based Business
─ New Charitable Integration for Managed
Accounts Platform Enables Advisors to Provide More Comprehensive
Planning Services to Clients
Fidelity Clearing & Custody Solutions, the division of
Fidelity Investments® that provides clearing and custody to
registered investment advisors (RIAs), retirement recordkeepers,
broker-dealer firms, banks and insurance companies, announced today
that it reached $150 billion in assets on the Managed Accounts
Solutions (MAS) platform,1 which is powered by Envestnet, Inc.
(NYSE: ENV).2 The pace of growth for the platform is more than
twice the industry rate.3 Future growth is also expected to
increase due to several factors, including the current regulatory
environment. Fidelity’s survey of financial advisors in advance of
the recently announced DOL Investment Advice Rule found that they
plan to recommend managed accounts more often to their clients as a
result of the rule, and firms expect a 10 percentage point increase
in their use of fee-based compensation once the rule is in
effect.4
Fidelity Clearing & Custody Solutions and Envestnet also
announced today that broker-dealers using its MAS platform can
provide their clients with access to a Giving Account, a
donor-advised fund at Fidelity Charitable®.5 Fidelity Charitable
research found that about half of donors surveyed donate to charity
using only cash, checks, or credit card payments.6 Providing direct
access to a donor-advised fund on the Envestnet platform enables
advisors to provide a smarter way for clients to fund their
philanthropy by choosing the right asset at the right time.
“Over the past few years, advisors have been leveraging our
managed accounts platform to provide investment management services
for their clients in an efficient and scalable way,” said Mark
Haggerty, head of product for Fidelity Institutional. “We’re now
expanding the capabilities available so that advisors can focus on
their clients’ broader financial picture.”
In fact, offering planning services can help advisors grow their
business. Fidelity research finds that advisors who provide
financial planning services (including charitable planning) to
their clients have higher assets under management and higher
compensation vs. their peers: their AUM is almost four times
greater ($150 million vs. $38 million) and their compensation is 40
percent higher ($200,000 per year vs. $140,000 per year).7
“This milestone is the result of a great relationship with
Fidelity that provides advisors with a broad selection of managed
account products and wealth management technology to help meet the
goals and risk tolerances of their clients,” said Jud Bergman,
chairman and chief executive officer, Envestnet. “The impressive
growth of the Managed Accounts Solutions platform demonstrates that
advisors find it to be a powerful set of solutions to deliver
better outcomes for their clients.”
About Managed Accounts
SolutionsFidelity Institutional built its managed
accounts platform to help advisors meet the challenge of
efficiently providing their clients with investment management
services tailored to their particular financial situations and risk
tolerance. Powered by Envestnet’s web-based technology, the
platform offers access to institutional money managers and hundreds
of managed account options, and handles monitoring and rebalancing
investments for advisors as the markets change. MAS has seen
exceptional growth in part due to its extensive integration with
Envestnet which is unique to the industry.
About Fidelity
InvestmentsFidelity’s goal is to make financial
expertise broadly accessible and effective in helping people live
the lives they want. With assets under administration of $5.3
trillion, including managed assets of $2.0 trillion as of April 30,
2016, we focus on meeting the unique needs of a diverse set of
customers: helping more than 25 million people invest their own
life savings, nearly 20,000 businesses manage employee benefit
programs, as well as providing nearly 10,000 advisory firms with
investment and technology solutions to invest their own clients’
money. Privately held for nearly 70 years, Fidelity employs 45,000
associates who are focused on the long-term success of our
customers. For more information about Fidelity Investments, visit
https://www.fidelity.com/about.
About EnvestnetEnvestnet,
Inc. (NYSE: ENV) is a leading provider of unified wealth management
technology and services to investment advisors. Our
open-architecture platforms unify and fortify the wealth management
process, delivering unparalleled flexibility, accuracy,
performance, and value. Envestnet solutions enable the
transformation of wealth management into a transparent,
independent, objective, and fully-aligned standard of care, and
empower advisors to deliver better outcomes.
Envestnet’s Advisor Suite® software empowers financial advisors
to better manage client outcomes and strengthen their practices.
Envestnet provides institutional-quality research and advanced
portfolio solutions through our Portfolio Management Consultants
group, Envestnet | PMC®. Envestnet | Tamarac provides leading
rebalancing, reporting, and practice management software.
Envestnet | Yodlee is a leading data aggregation and data
analytics platform powering dynamic, cloud-based innovation for
digital financial services. More than 950 companies, including 12
of the 20 largest U.S. banks and hundreds of Internet services
companies, subscribe to the Envestnet | Yodlee platform to power
personalized financial apps and services for millions of consumers.
Envestnet | Yodlee solutions help transform the speed and delivery
of financial innovation, improve digital customer experiences, and
drive better outcomes for our clients and their customers.
For more information on Envestnet, please visit
www.envestnet.com and follow @ENVintel
(https://twitter.com/envintel).
Envestnet is an independent company and unaffiliated with
Fidelity Investments. There is no form of legal partnership,
agency, affiliation, or similar relationship between Envestnet and
Fidelity Investments. The information contained herein is general
in nature, is provided for informational purposes only and is not
legal advice. Fidelity does not provide advice of any kind.The
registered trademarks and service marks appearing herein are the
property of FMR LLC and Envestnet, Inc.Fidelity Clearing and
Custody SolutionsSM provides clearing, custody or other brokerage
services through National Financial Services LLC or Fidelity
Brokerage Services LLC. Members NYSE, SIPC.Products and services
provided through Fidelity Institutional Asset Management (FIAM) to
investment professionals, plan sponsors, and institutional
investors by Fidelity Investments Institutional Services Company,
Inc., 500 Salem Street, Smithfield, RI 02917762534.2.0
1 Represents assets under management, assets under
administration, and assets under performance reporting agreements.2
Fidelity Institutional is the division of Fidelity Investments that
provides clearing, custody and investment management products to
registered investment advisors, broker-dealers, family offices and
banks. Envestnet is a leading provider of unified wealth management
technology and services to investment advisors and wealth
managers.3 Compound annual growth rate for the 5-year period
2009-2014 was 42.3% for Fidelity’s Managed Account Solutions
program vs. 17.3% for the industry, based on Fidelity
Institutional’s internal data and Cerulli Associates Managed
Accounts 2015 Summary.4 Expectations of Upcoming DOL Ruling
research study which is a part of the 2016 Fidelity® Insights on
Advice program. The Expectations of Upcoming DOL Ruling study was
an online, blind survey (Fidelity not identified) fielded during
the period of January 5th through January 12th, 2016. Participants
included 485 advisors who manage client assets either individually
or as a team, and work primarily with individual investors. Advisor
firm types included 22 banks, 140 independent broker-dealers, 69
insurance companies, 108 regional broker-dealers, 63 RIAs, and 83
wirehouses, with findings weighted to reflect industry
composition. This study explored awareness and reactions to
the proposed DOL ruling and advisors’ perceptions of its impact on
various aspects of their business. The study was conducted by an
independent firm not affiliated with Fidelity Investments.5
Donor-advised funds are a type of charitable giving program that
allows donors to combine the most favorable tax benefits with the
flexibility to support their favorite charities at any time. The
Charitable Investment Advisor Program allows a donor with a Giving
Account with a balance of $50,000 or more to nominate an eligible
advisor to manage a portion of the charitable assets in their
Giving Account.6 Based on a survey of 950 donors who give to
charity, conducted 2015-2016. The surveys were conducted by W5, an
independent research firm. The percentages reported exclude donor
responses of NA/Unsure. Questions about understanding of charitable
giving vehicles, time spent on charitable giving, charitable
budgeting, importance of charitable giving compared to other
financial priorities, and ability to give in the future were all
asked to half of the base sample.7 Source: 2015 Financial Advisor
Community, Investor Planning Research. The Investor Planning study
was an online, blind survey (Fidelity not identified) fielded
during the period of September 1st, 2015, through September 15th,
2015. Participants included 390 advisors who manage client assets
either individually or as a team, and work primarily with
individual investors. Advisor firm types included a mix of banks,
independent broker-dealers, insurance companies, regional
broker-dealers, RIAs, and wirehouses, with findings weighted to
reflect industry composition. The Financial Advisor Community panel
research program explored various topics of interest to advisors
throughout the year (including financial planning services provided
to clients) and was conducted by Bellomy Research, an independent
firm not affiliated with Fidelity Investments.
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version on businesswire.com: http://www.businesswire.com/news/home/20160524006467/en/
FIDELITYCorporate
Communications617-563-5800fidelitycorporateaffairs@fmr.comorNicole
Abbott, 201-915-7548nicole.abbott@fmr.comorENVESTNETDana Taormina,
973-850-7305dtaormina@jconnelly.com
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