Without fanfare or a press release Betterment posted to its blog for advisors Thursday the availability of something long sought by wealth managers on the platform: portfolio creation.
Called custom model portfolios, advisors can now create their own ETF-based portfolios and get automated rebalancing, tax-loss harvesting, asset location, tax-optimized sales for withdrawals and even glide path rebalancing. Only ETFs are supported, at least for now, no mutual funds, single stocks, or other securities.
“We've had inquiries from firms already on the platform about bringing on their own models for several years, and have repeatedly had to turn away firms that wanted to work with us but couldn't because they wanted to keep using their own models,” said Betterment for Advisors general manager Jon Mauney in an email response.
“This past year, we got to the point where we saw a clear line of sight on how to make our backend more flexible in order to support more investment models,” he said add that the introduction of this feature does two things for the firm. First, it allows Betterment to better serve their existing firms and it allows the firm to tap into a new market of advisory shops that would otherwise not have been able to work with them.
As stated in the post, Betterment will incorporate an advisor’s capital markets assumptions into the automated planning and projection features as well.
While advisors get access to custom model portfolios for no additional cost, doing so does require moving over $2.5 million in client assets, according to Betterment spokesperson Danielle Shechtman.
In her email response with additional details it was noted that participating firms are asked to commit assets within a 90-day timeframe “in order to justify the cost for Betterment to construct and maintain these portfolios.”
Advisors can find answers to many basic questions about the new offering by visiting a newly published Betterment for Advisors FAQ page as well (and sign up for more information or to ask additional questions).
That page refers to the new portfolios creation service as a “white-glove program” where firms will work closely with Betterment’s relationship managers, trading specialists, and engineers to set up your firm’s portfolio models.
One of the many questions and answers on the page clarifies the differences between the previous available “flexible portfolios”, which allowed advisors to customize portfolios using ETFs that are part of the Betterment Core Portfolio Strategy. With the new custom model portfolios offering advisors can choose from most any ETF “as long as there is sufficient liquidity and trading volume.” And the new offering is eligible for tax-efficient automated features including Betterment’s tax loss harvesting (TLH+) and tax coordinated portfolios (TCP).
Envestnet | MoneyGuide now integrated with MaxMyInterest
Advisors using the MoneyGuide financial planning application can now easily incorporate MaxMyInterest’s cash solution into their planning efforts.
Advisors can then view MaxMyInterest client checking and savings account balances directly in client plans within Envestnet | MoneyGuide.
"We believe that everyone deserves a quality financial plan and cash management is an essential part of that," said Tony Leal, President of Envestnet | MoneyGuide in a statement.
"With this integration, we will be able to deliver an innovative way for advisors to automatically gain greater visibility into cash balances while helping their clients earn more."
Pulse360 adds two improvements
Advisor efficiency startup Pulse360 has introduced two new features to its application. Users can now automatically trigger workflows (similar to the triggering of tasks announced in December). Now, an advisor can email a client and it automatically will trigger a workflow and at the same time trigger an independent task, so what previously would have taken three actions can now be triggered in one. This feature works with both WealthBox and RedTail CRM systems, both popular with independent advisors.
Consider as an example: You email a new prospect "Thank you for your trust in deciding to work with us." In the past an advisor have to go into her or his CRM and start a workflow to onboard the client or if receiving a referral, you would have to create an independent task to remind you to thank the person that referred this client. These can now be accomplished in one step according to founder and CEO Anand Sheth.
A second update relates to handwritten notes. Many advisors still actually rely on using handwritten notes that, at best, get saved as PDFs for compliance purposes, presenting the problem of searching (among others). With the new built-in Digital Notepad, for every notepad created an advisor can add searchable tags.
Alto adds crypto fund managers to its platform
Alternative asset IRA platform Alto has added crypto fund managers Bitwise, Grayscale, and SkyBridge Capital to its platform.
Through its network of more than 20 investment platform partners, which includes AngelList and Republic, Alto allows both accredited and non-accredited investors to diversify and manage their portfolio of alternative assets on a single interface.
For advisors not actively tracking, Bitwise, founded by Bitwise Asset Management created the first cryptocurrency index fund; Grayscale Investments claims to be the world’s largest digital currency asset manager, with more than $33B in assets currently under management; while SkyBridge Capital was founded by Anthony Scaramucci.