Centralized Portfolio Management (CPM) for Unified Managed Accounts
The Unified Managed Account offers clients complete asset allocation composed of multiple investment vehicles all within a single account. It provides efficiencies and enhancements for all members participating in the investment process. Clients now receive more consistent asset allocation, after-tax returns, and full customization all within an easy to understand account structure. Advisors can deliver this improved investment experience while simultaneously freeing up time to better service their client relationships. Investment managers are able to focus on their strengths (stock selection), and avoid the burden of account administration. Program sponsors are able to maintain a consistent offering, and administer program-wide changes with ease.
To help to make all of this possible, a centralized portfolio manager brings technology and expertise into the investment mix. The job of the centralized portfolio manager is to coordinate and implement trading within the UMA account. While Centralized Portfolio Management is available through software, enabling a program sponsor to administer their own UMAs, the full potential of the UMA is best served with an experienced full service centralized portfolio manager, like Parametric. Parametric’s Centralized Portfolio Management technology allows every client an individual investment experience based on their asset allocation, customization needs, and tax situation.
Key features and benefits
Clients
As investment products have evolved through the decades, each new version provides a different investment experience for the client. Mutual funds and exchange traded funds increased diversification among investors at low minimums. Separate accounts introduced transparency, customization, and the potential for improved after-tax returns. Parametric’s Centralized Portfolio Management UMA management gives clients the best of both worlds, while also experiencing enhancements that have not existed until now:
- Fully customizable through account-level restrictions and tax considerations
- Disciplined rebalancing
- Access to separate account managers at lower minimums
- One performance report, custodial statement, and agreement
- Industry leading tax management
- Ongoing tax loss harvesting
- Deferral of short-term gains
- Wash sale avoidance
- Tax-efficient withdrawals, security deposits, manager changes, and allocation changes
Advisors
The goal for investment advisors is a solution that offers a better investment experience for their client, doesn’t add additional costs, and frees up time to develop the client relationship. As most in the investment industry now recognize, the personal relationship between the investment advisor and client ranks as the most important aspect of the client’s experience. With Parametric Centralized Portfolio Management UMA management, the advisor now has the tools to deliver a more sophisticated, yet easier to understand package to their client:
- Shifts client’s focus to strategy, not individual pieces
- Automatic rebalancing
- Reallocations made simpler
- Single point of contact for account activity
- Tax transition analysis for clients funding in-kind
- Tax-managed throughout the year
- Administrative simplicity
- Competitive offering
UMA Program Sponsors
As wirehouses, banks, regional broker dealers, RIAs, and turn-key asset management providers create their own UMAs, the need for customization is a certainty. What works for one program doesn’t necessarily work for another. Parametric works with each one of our UMA program sponsors to customize their program to fit their needs:
- Open and closed allocation options
- Flexible rebalancing options
- Level of tax management
- Trading considerations
- Custom reporting
- Pre-trade analytics
Managers
The role of the investment manager is rapidly changing. As UMA programs become the new delivery mechanism for separate accounts, manager participation has skyrocketed. Now managers that didn’t have the operational and administrative capacity to manage separate accounts are able to gain access to a new market segment. Parametric has created a relationship with investment managers that is simple, yet robust:
- User-friendly model delivery website
- Monthly sales reports
