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LPL Financial (LPLA) Unveils Direct Indexing Investment Strategy
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LPL Financial (LPLA - Free Report) , a leading player in the financial industry, has unveiled a new addition to its Model Wealth Portfolios (MWP) unified managed account program. The announcement was made during the company’s financial event, Focus 2023, held in San Diego, CA.
The innovation comes in the form of direct indexing, a strategy that promises to revolutionize investment trading strategies by enhancing tax efficiency and tailoring outcomes for clients. This dual benefit holds immense promise for both advisors and investors. The functionality will be accessible via custom indexed separately managed account (SMA) solutions within the MWP.
These custom index SMAs have been thoughtfully crafted by LPL Research, drawing on the expertise of industry-leading indexes from MSCI Inc. Notably, the SMAs require a minimum investment of $100k and feature a range of equity options, spanning large-cap, small- and mid-cap, and international equities. This diversity empowers advisors to craft robust core portfolios that are meticulously tailored to each client's unique requirements.
Rob Pettman, the executive vice president of Wealth Management Solutions at LPL Financial, noted, "Financial advisors are always looking to help improve client outcomes and deliver personalized investment solutions." He added that investors today seek strategies that enable customization, helping them achieve diverse goals such as tax reduction and sector-specific preferences.
Collaborating with MSCI, LPL Financial has seamlessly integrated customized versions of the MSCI USA and EAFE ADR indexes into its strategy.
Launching in August 2023, LPLA’s direct indexing strategy offers advisors unprecedented customization and control. This includes the option to implement automatically-recurring tax harvesting strategies tailored to the distinct portfolios of each MWP client. The introduction of direct indexing signifies a leap in personalized investment strategies, promising a win-win for advisors and investors.
LPL Financial has always been striving to offer the best investment solutions. The launch of a no-transaction-fee exchange-traded fund (ETF) network will likely continue to boost the value of its advisory platform. The company’s advisory revenues have been increasing over the past several years. Advisory revenues witnessed a five-year (2017-2022) CAGR of 22.4%.
Further, over the years, LPLA has been diversifying its business through opportunistic acquisitions. In February, it acquired FRGIS and the Private Client Group business of Boenning & Scattergood. In 2021, it took over Waddell & Reed's wealth management business, while in 2020, the company acquired Blaze Portfolio, the assets of E.K. Riley Investments, LLC and Lucia Securities.
Shares of LPL Financial have rallied 6.9% so far this year against a 2.2% decline for the industry.
Interactive Brokers (IBKR - Free Report) unveiled a new platform – Securities Lending Dashboard – last month. It aims to provide clients with enhanced tools for assessing short-selling activity and making informed trading decisions.
The innovative platform offers sophisticated investors, including hedge funds, access to an extensive range of securities lending data, empowering them to evaluate investment opportunities more effectively. The Securities Lending Dashboard complements IBKR’s existing Securities Loan Borrow (SLB) system, a self-service utility for identifying shortable stocks.
Also, Citigroup (C - Free Report) has launched a platform — CitiDirect Commercial Banking — which offers a single-entry point digital platform to cater to the needs of Citi Commercial Bank clients. The initiative is part of the bank’s significant strategic investment plan to meet the growing global needs of these clients.
Particularly, the CitiDirect Commercial Banking platform brings together the bank’s global products and services into a single digital platform. This provides clients with a comprehensive view of their Citi banking relationship across Cash, Loans, Trade, FX, Servicing and Onboarding.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.
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LPL Financial (LPLA) Unveils Direct Indexing Investment Strategy
LPL Financial (LPLA - Free Report) , a leading player in the financial industry, has unveiled a new addition to its Model Wealth Portfolios (MWP) unified managed account program. The announcement was made during the company’s financial event, Focus 2023, held in San Diego, CA.
The innovation comes in the form of direct indexing, a strategy that promises to revolutionize investment trading strategies by enhancing tax efficiency and tailoring outcomes for clients. This dual benefit holds immense promise for both advisors and investors. The functionality will be accessible via custom indexed separately managed account (SMA) solutions within the MWP.
These custom index SMAs have been thoughtfully crafted by LPL Research, drawing on the expertise of industry-leading indexes from MSCI Inc. Notably, the SMAs require a minimum investment of $100k and feature a range of equity options, spanning large-cap, small- and mid-cap, and international equities. This diversity empowers advisors to craft robust core portfolios that are meticulously tailored to each client's unique requirements.
Rob Pettman, the executive vice president of Wealth Management Solutions at LPL Financial, noted, "Financial advisors are always looking to help improve client outcomes and deliver personalized investment solutions." He added that investors today seek strategies that enable customization, helping them achieve diverse goals such as tax reduction and sector-specific preferences.
Collaborating with MSCI, LPL Financial has seamlessly integrated customized versions of the MSCI USA and EAFE ADR indexes into its strategy.
Launching in August 2023, LPLA’s direct indexing strategy offers advisors unprecedented customization and control. This includes the option to implement automatically-recurring tax harvesting strategies tailored to the distinct portfolios of each MWP client. The introduction of direct indexing signifies a leap in personalized investment strategies, promising a win-win for advisors and investors.
LPL Financial has always been striving to offer the best investment solutions. The launch of a no-transaction-fee exchange-traded fund (ETF) network will likely continue to boost the value of its advisory platform. The company’s advisory revenues have been increasing over the past several years. Advisory revenues witnessed a five-year (2017-2022) CAGR of 22.4%.
Further, over the years, LPLA has been diversifying its business through opportunistic acquisitions. In February, it acquired FRGIS and the Private Client Group business of Boenning & Scattergood. In 2021, it took over Waddell & Reed's wealth management business, while in 2020, the company acquired Blaze Portfolio, the assets of E.K. Riley Investments, LLC and Lucia Securities.
Shares of LPL Financial have rallied 6.9% so far this year against a 2.2% decline for the industry.
Image Source: Zacks Investment Research
Currently, LPLA carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Financial Firms Taking Similar Steps
Interactive Brokers (IBKR - Free Report) unveiled a new platform – Securities Lending Dashboard – last month. It aims to provide clients with enhanced tools for assessing short-selling activity and making informed trading decisions.
The innovative platform offers sophisticated investors, including hedge funds, access to an extensive range of securities lending data, empowering them to evaluate investment opportunities more effectively. The Securities Lending Dashboard complements IBKR’s existing Securities Loan Borrow (SLB) system, a self-service utility for identifying shortable stocks.
Also, Citigroup (C - Free Report) has launched a platform — CitiDirect Commercial Banking — which offers a single-entry point digital platform to cater to the needs of Citi Commercial Bank clients. The initiative is part of the bank’s significant strategic investment plan to meet the growing global needs of these clients.
Particularly, the CitiDirect Commercial Banking platform brings together the bank’s global products and services into a single digital platform. This provides clients with a comprehensive view of their Citi banking relationship across Cash, Loans, Trade, FX, Servicing and Onboarding.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.