Fidelity Investments Expands Institutional SMA Product Line, Adds 8 Custom and Model Strategies for Wealth Management Firms

Odaily Odaily reports that asset management firm Fidelity Investments has announced an expansion of its institutional Separately Managed Account (SMA) product line, adding 6 custom strategies and 2 model strategies for Registered Investment Advisors (RIAs) and broker-dealer clients, aimed at enhancing personalized investment services for high-net-worth individuals.

The newly added strategies include the Fidelity Institutional Tax-Managed Enhanced Equity strategy and the Fidelity Institutional Tax-Managed Fundamental Equity strategy. Both strategies cover large-cap core, growth, and value investment styles, combining Fidelity's long-term active management capabilities with a customized SMA service model.

Among these, the Enhanced Equity strategy employs a benchmark-tracking framework, seeking excess return opportunities through diversified alpha factors. The Fundamental Equity strategy is based on a systematic portfolio construction process combined with high-conviction stock selection.

Fidelity stated that the above strategies are now available to RIA firms through its custom SMA platform, which integrates with the Fidelity Wealthscape brokerage platform. This integration helps wealth management firms with client account opening, strategy customization, execution, and portfolio monitoring.

Amanda Robinson, Head of Distribution for Fidelity Wealth Advisor Solutions, stated that as investor demand for personalized investment experiences continues to grow, particularly with the expanding scale of the ultra-high-net-worth client segment, wealth advisors need more flexible and customized asset management tools. By combining active management, direct indexing, and factor strategies, Fidelity provides advisors with deeper portfolio customization and tax management capabilities.

Since launching its institutional custom SMA product line in 2022, Fidelity has grown the number of standardized SMA strategies it offers to 50. It also supports advisors in combining multiple indices or strategies to form customized allocation solutions based on client needs.

Additionally, Fidelity has launched two equity model SMA strategies: the Fidelity Institutional Blue Chip Growth Focused Model SMA and the Fidelity Institutional Small Growth Focused Model SMA. These are targeted at RIA and broker-dealer clients and can be integrated into a Unified Managed Account (UMA) framework to achieve more comprehensive and tax-optimized investment management.

Currently, Fidelity offers 8 active equity model SMA strategies covering U.S. stocks, sectors, and international equity markets. Additionally, 5 factor model strategies and 2 index model strategies are available through the Fidelity Managed Account Xchange (FMAX) and third-party platforms.

Fidelity stated that its SMA strategies are developed by the Quantitative Research and Investments team within Fidelity Asset Management. This team consists of over 250 quantitative analysts, data scientists, and technologists, leveraging proprietary data accumulated over the long term, systematic investment methods, and artificial intelligence technology to uncover investment opportunities.