Does LPL have a fee based asset allocation model where they select the mutual funds and then rebalance annually?  Do you just have to build one yourself?

The kind I am talking about is where there is one platform and different models based on risk.  Client gets funds at NAV, then pays a fee.  Funds are picked by investment committee and come from a wide variety of mutual fund families.  Funds are picked on an unbiased basis. (whew)

Well, someone out there at LPL knows what I am talking about because most every firm has one of these now.  If you have one, what is it called and have you been happy with the administration and performance.

[quote=vbrainy]

Does LPL have a fee based asset allocation model where they select the mutual funds and then rebalance annually?  Do you just have to build one yourself?

The kind I am talking about is where there is one platform and different models based on risk.  Client gets funds at NAV, then pays a fee.  Funds are picked by investment committee and come from a wide variety of mutual fund families.  Funds are picked on an unbiased basis. (whew)

Well, someone out there at LPL knows what I am talking about because most every firm has one of these now.  If you have one, what is it called and have you been happy with the administration and performance.

[/quote]

Yes LPL does have a fully managed mutual fund advisory program called OMP with different models based on risk. They also have one where the advisor can decide on the asset allocation, pick the individual investments (mutual funds, etfs, stocks, etc...) and make changes/rebalance whenever they want to. My understanding is that there are also some new programs rolling out soon that are more of the turnkey type where LPL will manage the whole thing (like OMP) for the advisor.

What does OMP stand for?

OMP stands for Optimum Market Portfolios. And it is crap!

They also have OAP Optimum Annuity Portfolio It is crap also they went with Skandia   I think they went with who ever would pay the most under the table  Whe are not required to use this crap it is sad to see LPL sell out 

CAN YOU SAY IPO SUX

OMP and OAP were in development long before the private equity deal rolled out.  They definitely went w/ higher bidders v others, I know that WM and there was one other firm I can’t recall, wouldn’t put up the money LPL was looking for…good bad or different I don’t know, it is what it is.  What bothers me though is it’s more proprietary than not under disguise.  They on one hand make it more difficult to work with other platforms like OMP that outside vendors (Curian, SEI, etc) so that you are more apt to go with OMP.  It’s a win win for them:  they get paid by the vendor and don’t have to build, manage or rebalance the product, yet they “own” it.  My big complaint is the lack of choice, which in my mind makes it poor quality.

To clarify my point; to me the OMP platform is LPL proprietary product and it is an inherent conflict of interest for me in regards to my clients and to my independence.  LPL built it out for my win win comments…adds an additional revenue source for them, just like these new clearing deals are - which helps them get 2x earnings on a private equity deal and raises their value at IPO time! 

IRRC, OMP also pays LPL a 0.25% advisory fee on top of what we charge the client under that model.  I’m not using it as the auto-rebalancing creates a mess at tax time for a bunch of stupid little transactions.  I personally prefer to decide when things are bought and sold for tax efficiency and to keep the CPAs from pulling out their hair.  I suppose it would be OK for retirement accounts, but like the other people here, I looked at the lineup and was less than impressed.  I guess it’s just too costly to hire the best managers, but I prefer to do my own research and use managers I feel good about.  In LPL’s defense, they are fine with me doing so and their SAM platform has covered about 95% of the managers I’ve found and wanted to use.