Asset management giant BlackRock has partnered with alternative investment platform iCapital and asset management platform GeoWealth to allow RIAs using BlackRock's custom model portfolios to invest in private assets alongside traditional investments in unified managed accounts . iCapital's technology will support a customized platform experience for these RIAs using GeoWealth's investment execution platform.
iCapital's recently launched multi-investment workflow tool aims to simplify the alternative investment experience for VNR. The tool, which iCapital debuted earlier this month, allows advisors to process multiple investments in a single environment. Meanwhile, GeoWealth will give these RIAs access to workflows, reporting tools and investment management capabilities.
The integration between the three firms will help ease RIAs' access to BlackRock's customized models. The models combine private assets, direct indexing, fixed income SMAs, traditional ETFs and mutual funds in one account.
In July, BlackRock partnered with GeoWealth to offer customized model portfolios that include private equity and debt funds alongside traditional ETFs and mutual funds in the US wealth channel. The company has been trying to make inroads into the US property market, identifying it as one of its biggest growth opportunities.
As the RIA industry consolidates, the growing firms that control 80% to 90% of the industry's assets are looking to form partnerships to work with fewer asset managers and service providers, according to Jaime Magyera, co-head of U.S. wealth advisory at BlackRock.
BlackRock expects a lot of growth in the private wealth space over the next few years to come from the model portfolio segment, especially when it comes to extremely high net worth clients, she said.
“Part of that is putting together a platform that helps an advisor customize and customize a portfolio across the public and private markets and then implement it easily, conveniently through one platform,” she said. “And what we are doing through this partnership. Today, there are probably $4 trillion to $5 trillion in model portfolios. We think that in the coming years it will double. This space – mock wallets, custom wallets – will be the future of the wealth industry. But it should be easy; it must be implemented in a very appropriate manner.”
In recent months, asset managers have raced to offer more customized model portfolios and improve the process of using them. on monday, Goldman Sachs Asset Management revealed it partnered with GeoWealth to build custom open-architecture models for its RIA customers using GeoWealth's UMA platform.
“We are excited to partner with these two industry leaders to build the infrastructure needed to support alternatives in the same accounts as the rest of the portfolio,” iCapital chairman and CEO Lawrence Calcano said in a statement. “Our deep integrations with GeoWealth and BlackRock will further transform the digital alternatives investment experience for advisors and their high net worth clients.”