Investment Solutions Guide

Transcription

1 Investment Solutions Guide BNY Mellon s Advisors, Inc. () discretionary managed portfolios include traditional and objective-based wrap accounts that primarily use mutual funds/exchange-traded funds (ETFs), an array of research covered and openarchitecture separately managed account (SMA) strategies, as well as unified managed accounts. In addition, has engaged with third-party model providers to expand the lineup of investment options available. The combination of and third-party investment solutions provide financial professionals with a diverse investment offering designed to meet a broad array of client investment goals and help them grow their advisory practice. Investment Solutions Investment Solutions WealthStart / American Funds Core AdvisorFlex Asset Allocation Investment Separately Managed Accounts Third Party Model Providers Overview Multi-manager, multi asset class ETF portfolios managed by. Twelve portfolios, six tax aware and six traditional, span the risk spectrum targeting emerging to mass-affluent investors. The portfolios are designed for investors seeking s manager research and portfolio management within predominantly ETF portfolios. Developed by, the portfolios consist primarily of American Funds mutual funds along with select ETFs. Three traditional portfolios target emerging to high-net-worth investors with an objectives-based solution for each stage of the wealth management life cycle. The portfolios are designed for investors seeking to combine the investment philosophies and capital market views of with the longterm investment results of the American Funds. is solely responsible for the fund selection and construction of the and neither American Funds Distributors, Inc. nor its affiliates are involved in such activities. Flexible multi-manager primarily ETF/mutual fund wrap accounts managed by. Thirty-two objectives-based portfolios, sixteen tax aware and sixteen traditional, target mass-affluent to high-networth investors with solutions for all phases of the investor life cycle. The portfolios provide investors with asset allocations based on s capital markets views, while allowing advisors the flexibility to select from a diverse universe of investments researched by. Multi-manager primarily ETF/mutual fund wrap accounts managed by. Five traditional, risk-based portfolios span the risk spectrum targeting mass-affluent to high-net-worth investors. The portfolios provide investors with investments researched by and asset allocations based on s capital market views. Investment is a discretionary, multi-discipline managed account solution housed in a single portfolio (a unified managed account). As the portfolio manager, determines asset allocation strategy and selects investment vehicles and subadvisors. Five core and four alternative models span the risk spectrum targeting high-net-worth investors. are managed with regard to the investor s tax status and tax efficiency. offers both Research Covered and Open Architecture SMA programs. Research Coverage is a turnkey SMA solution with approximately 60 money managers and more than 90 investment strategies. The covered money managers must undergo an extensive screening process and are subject to ongoing research review. Open Architecture is designed to provide additional options for managing investor portfolios. Approximately 150 money managers are available, representing more than 500 investment strategies. offers a Third-Party Model Providers product, which allows access to asset allocation Models generated by Third-Party Model Providers. Firms can select the Model or Models in which Clients would like their account assets managed. As of March 31, 2018

2 Investment Solutions from Third Party Model Providers Model Provider Model(s) Overview ASG Risk-Efficient BlackRock Target Income BlackRock Long- Horizon Allocation ETF Portfolio Calvert Responsible Invesco Multi-Asset ETF Loring Ward DFA Funds Global * Multi-manager ETF/mutual fund portfolios following a risk-based strategy designed by AlphaSimplex using a dynamic approach to asset allocation. Three traditional portfolios target risk conscious investors. The portfolios are designed for investors seeking active risk management where risk-return characteristics are top priority. The Target Income Portfolio are a suite of investment options with varying fixed income allocations that seek different levels of income generation and exposure to risk. Four traditional portfolios target emerging to mass-affluent investors seeking specific levels of current income. The Long-Horizon Allocation ETF Portfolio are a suite of investment options with varying allocations to equities and fixed income. Five traditional portfolios span the risk spectrum targeting emerging to mass-affluent investors. These strategies seek to deliver long-term results by combining a low-turnover approach with a limited number of cost-effective equity and fixed income ishares ETFs. Calvert s Responsible Allocation Models are built with Calvert mutual funds that utilize Calvert s financial and responsible investment analysis. Three portfolios target mass-affluent to high-net-worth investors. The portfolios are designed for investors seeking broad diversification managed in accordance with Calvert s proprietary environmental, social and governance (ESG) principles, the Calvert Principles for Responsible Investment. Invesco Global Solutions builds multi-asset investment strategies that are designed to maximize the benefits of diversification while meeting specific investment outcomes. Five portfolios target specific levels of risk through strategic asset class allocations, with the potential to accommodate emerging to mass-affluent investors. The portfolios are implemented with PowerShares by Invesco smart beta ETFs, seeking to provide cost-effective exposure to the benefits of factor-based investing. The series is guided by Loring Ward s Asset Class Investing Philosophy and built with Dimensional Fund Advisors (DFA) mutual funds. With as many as 10,000 securities from 45 countries, representing 35 currencies, these seven model portfolios offer broad global diversification. With overweights toward value, small-cap and profitable equities, the Global Portfolio Series models are designed for investors who are comfortable with international investing and the multi-factor approach. As of March 31, 2018 * Loring Ward Models are only available to clients of firms that have entered into an agreement with LWI Financial, Inc. All investments are subject to risk, including loss of principal. For additional information, please refer to the Important Disclosures at the end of the report.

3 Investment Solutions from Third Party Model Providers Model Provider Model(s) Overview Morningstar Retirement Income Outcome-Based Series Morningstar Mutual Fund Asset Allocation Series Morningstar ETF Asset Allocation Series Russell Model Russell Hybrid Model Vanguard CRSP ETF Strategic Model The Morningstar Retirement Income Series are multi-manager mutual fund portfolios utilizing a valuation-driven asset allocation approach, using third-party managers that have passed through their independent, proprietary research process. These four portfolios are designed for investors transitioning from accumulation to distribution, Morningstar s Retirement Income portfolios take a total return approach. The Morningstar Mutual Fund Asset Allocation Series are multimanager mutual fund portfolios built utilizing a valuation-driven asset allocation approach, using third-party, active managers that have passed through their independent, proprietary research process. These five target-risk portfolios span the risk spectrum and are designed as core investments for investors. The Morningstar ETF Asset Allocation Series are multi-manager ETF portfolios built utilizing a valuation-driven asset allocation approach, using third-party, passive managers that have passed through their independent, proprietary research process. Like the mutual fund portfolios, these five target-risk portfolios span the risk spectrum and are designed as core investments for investors in the accumulation phase of their career; but seek lower-cost investments. Using a multi-asset approach, the Russell Model are globally diversified. Each strategy provides exposure to a mix of stocks, bonds and alternative investments and a variety of underlying money managers and investment styles. Ten portfolios, five tax-managed and five core, span the risk spectrum. The careful blending of managers, asset classes and styles attempt to manage risk and may help provide more consistent returns. The tax-managed model strategies offer a strategically tax-efficient management approach. Russell Investments Hybrid Model seek to provide a balance between investor s preference for active management excess return (upside) and their aversion to the risk of active management underperformance (downside). Seven core portfolios spanning the risk spectrum are designed for investors seeking an integration of active management, multi-factor and passive investment approaches. Vanguard model portfolios seek to provide broad exposure to U.S. and international equities and global investment-grade taxable bonds through Vanguard index ETFs. Eleven diversified portfolios span the risk spectrum targeting emerging to mass-affluent investors. The portfolios are designed for investors seeking low cost, index-centric investments with a high potential level of tax efficiency and low performance variability relative to the markets in which they invest. As of March 31, 2018 All investments are subject to risk, including loss of principal. For additional information, please refer to the Important Disclosures at the end of the report.

4 Important disclosures The third-party model provider (Model Provider) and/or model portfolios (Model or Models) referenced in this document are made available through the Managed360 Program, a fee-based advisory program sponsored by Advisors, Inc., or through the Managed Account Command platform, a third-party wrap program in which provides administrative services and/or portfolio management services. has contracted with the Model Providers to provide Models for inclusion in these programs., on a limited discretionary basis, invests assets in investor accounts according to the selected Model and will periodically buy and sell securities in an effort to keep the account aligned with the selected Model. At such time as a Model Provider notifies of a change to a Model, will generally make the corresponding change to the account; however, reserves the right to not accept a particular Model change. The Model Provider provides Models to on an ongoing basis. The Model Provider does not provide investment advice specifically to investors and is not responsible for determining the appropriateness or suitability of a specific Model. Each investor together with his/her financial advisor, selects the Model(s) in which the investor would like to invest. If an investor chooses a Model to be used in the management of their account, the account will be subject to fees charged in connection with the corresponding programs. For additional information regarding these fees, please refer to s Form ADV Part 2, Wrap Fee Brochure for the Managed360 Program or Firm Brochure, as applicable, which may be obtained by writing to:, Attn: Legal Department (AIM #19K-0203), 760 Moore Road, King of Prussia, PA 19406, or by calling (800) , Option 3. Certain information contained in this document has been provided by the Model Providers and is subject to change at any time without notice. The information contained herein does not constitute investment advice and is provided for informational purposes only. It is not intended to meet the objectives or suitability requirements of any specific individual or account, and does not provide a guarantee that the investment objective of any Model will be met. Investment need should be based on a client s own financial circumstances and investment objectives. Neither the information nor any opinions expressed herein should be construed as a solicitation or a recommendation by or any of its affiliates to buy, hold or sell any securities or to invest in a specific Model. Risks are inherent in any investment. There is no assurance that any Model Provider, Model, security, index or strategy will provide positive performance over time. Diversification and strategic asset allocation do not guarantee a profit or protect against a loss in declining markets. All investments are subject to risk, including the loss of principal. The investment objectives, risks, charges, fees, expenses and other important information about each mutual fund, ETF and other investment vehicle can be found in the prospectus and, if available, the summary prospectus, which may be obtained by calling the fund/ issuer or by visiting the fund s/issuer s website. Please read the prospectus and, if available, the summary prospectus carefully. that invest a significant portion of assets in one sector, issuer, geographical area or industry, or in related industries, may involve greater risks, including greater potential for volatility, than more diversified portfolios. Foreign investments are subject to risks not ordinarily associated with domestic investments, such as currency, economic and political risks, and may follow different accounting standards than domestic investments. Investments in emerging or developing markets involve exposure to economic structures that are generally less diverse and mature, and to political systems that can be expected to have less stability than those of more developed countries. These securities may be less liquid and more volatile than investments in U.S. and longer-established non-u.s. markets. that invest in small/mid-capitalization companies involve greater risk and price volatility than an investment in securities of larger capitalization, more established companies. Such securities may have limited marketability and the firms may have limited product lines, markets and financial resources than larger, more established companies. that invest in fixed income securities are subject to several general risks, including interest rate risk, credit risk, the risk of issuer default, liquidity risk and market risk. These risks can affect a security s price and yield to varying degrees, depending upon the nature of the instrument, and may occur from fluctuations in interest rates, a change to an issuer s individual situation or industry, or events in the financial markets. In general, a bond s yield is inversely rated to its price. Bonds can lose their value as interest rates rise and an investor can lose principal. If sold prior to maturity, fixed income securities are subject to gains/losses based on the level of interest rates, market conditions and the credit quality of the issuer. Morningstar Managed SM are offered by the entities within Morningstar s Investment Management group, which includes subsidiaries of Morningstar, Inc. that are authorized in the appropriate jurisdiction to provide consulting or advisory services in North America, Europe, Asia, Australia, and Africa. In the United States, Morningstar Managed are offered by Morningstar Investment Services LLC or Morningstar Investment Management LLC, both registered investment advisers, as part of various advisory services offered on a discretionary or non-discretionary basis. Portfolio construction and on-going monitoring and maintenance of the portfolios within the program is provided on Morningstar Investment Services behalf by Morningstar Investment Management LLC. Morningstar Managed offered by Morningstar Investment Services LLC or Morningstar Investment Management LLC are intended for citizens or legal residents of the United States or its territories and can only be offered by a registered investment adviser or investment adviser representative.

5 Investment research is produced and issued by Morningstar, Inc. or subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research Services LLC, registered with and governed by the U.S. Securities and Exchange Commission. For additional information regarding a Model Provider, please refer to the Model Provider s Form ADV Part 2 or other disclosure documents, which may be obtained by contacting the Model Provider or by visiting the SEC s website at For additional information about, as well as its products, fees and services, please refer to s Form ADV Part 2, Wrap Fee Brochure for Managed Account Advisor, Wrap Fee Brochure for the Sponsored Program, Wrap Fee Brochure for Managed360, Wrap Fee Brochure for Co-Sponsored Programs, or the Firm Brochure, as applicable, which may be obtained by writing to:, Attn: Legal Department (AIM #19K-0203), 760 Moore Road, King of Prussia, PA 19406, or by calling (800) , Option 3. Advisors, Inc. is an investment adviser registered in the United States under the Investment Advisers Act of 1940, an affiliate of Pershing LLC, and a wholly owned subsidiary of The Bank of New York Mellon Corporation (BNY Mellon). Pershing LLC, member FINRA, NYSE, SIPC. Trademark(s) belong to their respective owners. Neither, Pershing nor BNY Mellon are affiliated with the Model Providers.

6 2018 Advisors, Inc. All rights reserved. Advisors, Inc. () is an investment adviser registered in the United States under the Investment Advisers Act of and Pershing LLC are each wholly owned subsidiaries of The Bank of New York Mellon Corporation (BNY Mellon). Pershing LLC, member FINRA, NYSE, SIPC. Trademarks belong to their respective owners. pershing.com One Pershing Plaza, Jersey City, NJ LKWD-0318-GDE FS-LKWD-MMP-4-18