Four Portfolios Beef Up LPL Platform

LPL Financial LLC added two portfolios from LPL Financial Research and two managed alternative investment portfolios from Fortigent to its Model Wealth Portfolios (MWP) platform.

This expansion provides access to the two models designed by LPL Financial Research using a proprietary quad-core approach to create bond-like exposure without holding bonds, as well as Fortigent’s alternative strategy models, which are designed to capture performance with lower volatility.

The Quad-Core Balanced and Quad-Core Income Portfolios from LPL Financial Research extend the proprietary “Quad-Core” strategy that is currently offered on the MWP platform through the Absolute Return Portfolio.

The Quad Core, a four-pronged methodology intended to provide a more diversified approach to portfolio management, includes allocations to the opportunistic ideas of LPL Financial Research and the diversifying ideas from other managers to drive alpha and income, and then leverages non-correlated alternative strategies and hedging strategies to control the beta, or market sensitivity, of the portfolios.

The Quad-Core Income Portfolio seeks to replicate or beat the performance of core bonds while generating more income, and the Quad-Core Balanced Portfolio seeks the return of a traditional 60/40 stock-bond portfolio with little or no sensitivity to rising interest rates.

Fortigent, a provider of wealth management solutions to advisers serving the high net-worth market, is a wholly owned subsidiary of LPL Financial.

 The Fortigent portfolios enable LPL Financial-affiliated advisers to benefit from Fortigent’s background and expertise in alternative investments. Advisers can offer the diversification and risk-management benefits of alternative investments strategies with the liquidity and transparency benefits of mutual funds. The two portfolios—the Alternative Strategies and Alternative Strategies-Enhanced portfolios—are geared to capture the performance of traditional equity/fixed-income portfolios, but with lower volatility, reduced potential for loss of capital and lower correlation with other asset classes.

The LPL Financial Research portfolios and the Fortigent alternative investment strategies will allow advisers to address a wider range of client needs, while accessing the diversification and risk-management benefits that come from non-correlated alternative strategies, said John Moninger, LPL Financial executive vice president of advisory and brokerage consulting services. “As financial markets continue to evolve, LPL Financial is committed to providing our advisers with the strategies they need to help their clients progress toward their long-term goals,” Moninger said.

“In this volatile environment, advisers and their clients are looking for strategies that offer the potential for consistent returns along with attractive risk characteristics and diversification benefits,” said Scott Welch, senior managing director, investment research and strategy for Fortigent.