Dynasty Financial Partners, an RIA services provider, has formally launched a model portfolio program for its network of independent advisors. Called Model Select, the program offers top-down portfolio construction incorporating both passive and active fund strategies from leading asset managers. Most of the investment options are ETFs; a few select models also involve mutual fund exposures.
A spokesperson for Dynasty Financial Partners said the firm’s investment team is targeting a balance between “index where it makes sense,” factor exposure depending on market conditions and active management when it’s possible to obtain alpha.
Model Select has options suitable for 11 different levels of risk tolerance, as well as taxable fixed-income options. It incorporates automated portfolio trading, tax-efficient management, tax overlay capabilities and educational content for advisors.
Dynasty Financial Partners has been working on Model Select in the background for some time and already manages $5 billion in assets for advisors in its network. Chief Investment Officer Bob Shea leads the program, with support from several senior team members and the firm’s investment committee.
“We set out to build a sophisticated scalable multi-manager solution at a reasonable cost,” Shea said in a statement. “As we listened to the needs of our network partners, we realized it is a highly adaptable approach to portfolio management with broader appeal than we anticipated. We continue to enhance the program, finding boutique managers and exposures to non-traditional asset classes, which we view as key to helping Model Select evolve.”
In October, Dynasty received financial backing from BlackRock, JPMorgan Asset Management and Charles Schwab, raising its valuation to $800 million. The firm’s executives indicated they wanted to make greater investments in technology and its existing investment banking arm. A month earlier, Dynasty announced the appointment of Tim Oden, formerly of Schwab Advisor Services, as chief growth officer.
Model portfolios have exploded in popularity in recent years, with analysts from market research firm Cerulli Associates estimating that virtually every wealth manager today is using models in some capacity. Today, the bulk of those models are provided by third parties, including asset managers, TAMPs and alternative investment platforms.
