Investment Product and Service Launches

Fidelity announces expected SMA launch; Pershing integrates managed accounts to new annuity order platform; Ballast introduces equity strategies on Schwab managed account platform; and more.

Art by Jackson Epstein

Art by Jackson Epstein

Fidelity Announces Expected SMA Launch

Fidelity Investments announced it will launch Fidelity Advisor separately managed accounts (SMAs). The initial offering will debut in early 2020 with five equity SMA models.

“Investors are increasingly looking for investment strategies that are tailored to their specific needs and personal preferences, and for many, SMAs can be an appropriate solution,” says Judy Marlinski, president, Fidelity Institutional Asset Management. “Advisers can use SMAs to create personalized investment strategies for their clients that can complement existing holdings or apply tax-efficient techniques. We’re focused on providing choice and flexibility for advisers, and this new offering leverages Fidelity’s decades of portfolio management experience and diverse investment capabilities.”

FA International Capital Appreciation SMA seeks to invest in a combination of high-quality, cyclical growth stocks and growers. The portfolio managers on the managed account are Sammy Simnegar; Zach Dewhirst, CFA; Yasmin Landy, CFA; and Timothy Gannon, CFA.

FA Growth Opportunities SMA seeks to invest in companies with resilient business models that are inexpensive relative to Fidelity’s expectations of earnings per share in three to seven years. Portfolio managers include Kyle Weaver; Zach Dewhirst, CFA; Thomas Rollins, CFA; and Michael Kim.

FA Founders SMA seeks to invest in founder-involved companies with strong earnings growth potential at reasonable prices. Portfolio managers are Daniel Kelley; Zach Dewhirst, CFA; James Jordan; and Zhitong Zhang, CFA.

FA Small Company SMA seeks to invest in small cap stocks with superior growth potential and financial characteristics. The portfolio managers for this fund are Forrest St. Clair; Zach Dewhirst, CFA; and Benjamin Treacy, CFA.

FA Women’s Leadership SMA seeks to invest in companies that prioritize and advance women’s leadership/ development and have strong competitive moats that can result in durable earnings growth or in companies that can benefit from open-ended growth opportunities. Portfolio Managers: Nicole Connolly; Zach Dewhirst, CFA; Yasmin Landy, CFA; and Michael Robertson.

The Fidelity Advisor SMAs will be available to advisers through broker-dealer firms, registered investment advisers (RIAs) and managed account platform providers.

Pershing Integrates Managed Accounts to New Annuity Order Platform

BNY Mellon’s Pershing (Pershing) has completed the integration of its managed accounts technology with its annuity order entry platform, Subscribe.

The integrated solution supports over 70 fee-based annuity products from 18 carriers and is designed to deliver a seamless experience for advisers looking to incorporate fee-based insurance products into the wealth management process.

“Increasingly, advisers are turning to managed accounts to achieve a higher degree of customization and greater tax efficiencies,” says Sarah Chain, director of Global Strategy and Product Management at Pershing. “Access to annuities within managed accounts will allow advisers to provide comprehensive wealth management, including retirement income strategies.”

Specifically, the solution will allow advisers to construct a proposal inclusive of fee-based annuities; build a custom allocation mix in a flexible variable annuity model; open a managed account (including all pre-filled insurance carrier paperwork and the ability to share for eSignature); purchase an annuity contract electronically; provide account oversight; aggregate for billing; and receive daily detailed holdings and balance updates, or run on-demand and quarterly performance reports.

For advisers with previous annuity positions, the new solution offers the ability to network those existing positions into the managed account.

“Annuities offer advisers a valuable option to help meet client financial goals,” says Hans Schemmel, director of Retirement and Insurance-Based Solutions at Pershing. “Currently, these products are often managed independently. Providing advisers with access to fee-based annuities and investment advisory accounts will allow them to simplify the wealth management process and drive better efficiencies.”

The integration will help drive new efficiencies for advisers via direct connectivity to carriers, integration for compliance requirements (including broker-dealer forms), simplified recordkeeping through online document storage, and management of investment policy governance through risk tolerance alignment, says the firm.

Ballast Introduces Equity Strategies on Schwab Managed Account Platform

Ballast Equity Management has made its three U.S. equity strategies available on the Schwab Managed Account Marketplace platform. 

Managed Account Marketplace allows advisers to negotiate directly with their preferred money managers while benefiting from the brokerage and custody services of Charles Schwab.  Ballast strategies now available at Schwab are Quality Value Smallcap, Quality Value Midcap and Select Value.

“Ballast knows the value that registered investment advisers add in serving their clients. It is important to us to have our Quality Value strategies available at Charles Schwab, where many independent advisers with whom we partner custody their client accounts,” states Dave Mertens, partner and head of Business Development.

Harbor Offers Robeco Equity Funds to U.S. Clients

Harbor Capital Advisors has selected five Robeco quantitative equity funds to offer to its clients in the U.S.

The funds included are the Robeco Conservative Equity funds (Global, U.S., Global excluding U.S. and Emerging Markets) and one Robeco Active Quant fund (emerging markets). Harbor will launch these as mutual funds under dual Harbor Robeco branding.

“We are excited to have been selected by Harbor Capital Advisors, and look forward to working together,” says Maureen Beshar, head of Robeco U.S. and Canada. “While Harbor and Robeco have a long history, it is this history that makes the relationship remarkable. Given Harbor’s truly independent nature and the relationship between the companies, we had to prove even more that Robeco was the right choice. Harbor is known for its meticulous due diligence process, so being selected is another vote of confidence for our quant equity product range.”

Robeco U.S. focuses on the largest asset owners and mandate business in the country, whereas Harbor offers investment options to a different client group. Robeco and Harbor Capital Advisors are sister companies in the ORIX Europe holding.

E*TRADE Enhances Stock Plan Administration Platform

E*TRADE Financial Corporate Services, Inc. has announced a series of reporting and automation enhancements to its stock plan administration platform, Equity Edge Online (EEO).

The company’s first enhancement will be report bursting and file sharing functionality, allowing stock plan administrators to run certain participant reports and statements in EEO and deliver them as customized PDFs to participants on The company says the feature saves clients time and mailing costs, while providing access to grant and plan information for participants.

Administrators will also be able to customize retirement eligibility (RE) for shares on a grant-by-grant basis for an unlimited number of eligibility dates. Additionally, RE taxation is integrated within EEO’s existing taxation framework. The participant experience will also be streamlined—their unvested shares are automatically withheld to help cover potential tax liabilities. Participants will be allowed to see their retirement eligibility tax obligations through automatically generated confirmations on that break down Medicare, Social Security, federal, and state taxes. 

The final enhancement, ESPP share withholding, permits administrators to flag participants foreseen to have a taxable event during their ESPP purchase. Administrators can withhold shares to cover the participant’s tax obligations. Participants can alleviate the need to pay taxes with cash and limit the impact to their paycheck.

“Through our latest enhancements we’re equipping administrators with flexible, customizable solutions—enabling them to meet the needs of participants like never before,” says Scott Whatley, president of E*TRADE Corporate Services. “Stock plan administrators are constantly challenged to do more with less, so we are relentless in our pursuit to deliver an industry-leading platform that transforms manual and time-consuming processes into automated tasks. This way, administrators can spend more time delivering value-added services and boosting participant engagement.”

T.Rowe Price Presents China Evolution Equity Fund

T. Rowe Price has launched the T. Rowe Price China Evolution Equity Fund. The fund will seek long-term growth of capital through investments in Chinese companies. This launch marks T. Rowe Price’s first mutual fund focused solely on Chinese equities.

The fund mainly invests in companies in the bottom 50% of China’s combined market cap (of which more than 98% are listed companies), rather than in the top 50 index heavyweights.

The China Evolution Equity Fund will be managed by Wenli Zheng, a portfolio manager at T. Rowe Price with 11 years of investment experience.

“China is undergoing unprecedented changes, including an evolving economic model, industrial upgrades, and a shifting geopolitical outlook,” says Zheng. “These changes have created an investment landscape with ample mispricing opportunities. The China Evolution Equity Fund looks to exploit these opportunities through a style-agnostic approach unconstrained by an index.”

The fund’s primary benchmark will be the MSCI China All Shares Index Net. The net expense ratio is 1.40% for the Investor Class shares (Ticker: TCELX). This net expense ratio includes an agreement that limits the class’s total expenses from exceeding 1.40%, which will remain in effect through February 28, 2022. 

The net expense ratio is 1.04% for the I Class shares (Ticker: TRCLX). This net expense ratio includes an agreement that limits the class’s operating expenses to 0.05%, also remaining in effect through February 28, 2022. 

The fund’s minimum initial investment amounts are $2,500 for Investor Class shares and $1,000,000 for I Class shares.

CCA Selects Northern Trust for Fund Administration

Corry Capital Advisors (CCA) has appointed Northern Trust to provide fund administration and related services for CCA’s U.S. commingled funds.

Pittsburgh-based CCA selected Northern Trust earlier this year to provide fund administration and depositary services for Irish-domiciled funds to support its expansion into Europe and distribution of its longevity-based life settlement strategies to new investors.

“Northern Trust has provided exceptional client service and broad-based capabilities across asset classes and investment strategies,” says William Corry, founder and general manager of Corry Capital Advisors. “We look forward to expanding our relationship through this new mandate for our U.S. funds.”

“CCA’s selection of Northern Trust to provide fund administration for its U.S. commingled funds demonstrates the seamless nature of our global service model,” says Kimberly Evans, head of Private Capital Administration in North America. “By providing superior client service and support for CCA in Ireland, Northern Trust gave our clients confidence that we are best positioned to administer their funds in the U.S. We look forward to continuing to partner with CCA to help them achieve their strategic goals.”