Podcast
Questions and Answers
What is the primary function of tax loss selling?
What is the primary function of tax loss selling?
Which account management program tends to use model portfolios tailored to specific client needs?
Which account management program tends to use model portfolios tailored to specific client needs?
What distinguishes separately managed accounts (SMAs) from other investment accounts?
What distinguishes separately managed accounts (SMAs) from other investment accounts?
In which situation are non-model-based account management programs typically used?
In which situation are non-model-based account management programs typically used?
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What is a key advantage of using an external portfolio manager in separately managed accounts?
What is a key advantage of using an external portfolio manager in separately managed accounts?
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What is the primary responsibility of the overlay manager in a multi-mandate managed account?
What is the primary responsibility of the overlay manager in a multi-mandate managed account?
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How does a multi-mandate managed account achieve risk mitigation?
How does a multi-mandate managed account achieve risk mitigation?
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In the context of multi-mandate managed accounts, what is meant by 'sleeves'?
In the context of multi-mandate managed accounts, what is meant by 'sleeves'?
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What is the role of the overlay manager in regard to poorly performing managers?
What is the role of the overlay manager in regard to poorly performing managers?
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What benefit does a multi-mandate managed account offer to clients and their advisors?
What benefit does a multi-mandate managed account offer to clients and their advisors?
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What is typically required for a client to establish a managed account?
What is typically required for a client to establish a managed account?
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What is a primary benefit of using a private family office for high-net-worth clients?
What is a primary benefit of using a private family office for high-net-worth clients?
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How often must a managed account be reviewed by a designated supervisor?
How often must a managed account be reviewed by a designated supervisor?
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What does 'discretionary authority' in a managed account imply?
What does 'discretionary authority' in a managed account imply?
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Which of the following statements about managed accounts is true?
Which of the following statements about managed accounts is true?
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What is the main benefit of multi-manager accounts for high-net-worth clients?
What is the main benefit of multi-manager accounts for high-net-worth clients?
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What significant change can advisors make in their business model by utilizing multi-manager accounts?
What significant change can advisors make in their business model by utilizing multi-manager accounts?
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How do household accounts aim to manage investments across a family?
How do household accounts aim to manage investments across a family?
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What component is NOT typically included in the fees for multi-manager accounts?
What component is NOT typically included in the fees for multi-manager accounts?
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Which of the following statements about a private family office is accurate?
Which of the following statements about a private family office is accurate?
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Study Notes
Fee-Based Accounts
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Fee-based accounts bundle services and charge fees based on assets under management
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Common types include managed and unmanaged accounts
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Managed accounts:
- Employ licensed portfolio managers with trading authority
- Client holds ownership of account assets
- Offer a package of services (e.g., trading, rebalancing, custody, reporting)
- May include wealth management and financial planning services
- Typically include an investment policy statement
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Non-managed accounts:
- Can be full-service or self-directed brokerage accounts
- Full-service: Bundle financial planning and a fixed/unlimited number of trades, fees based on assets
- Self-directed: Cater to smaller account sizes, focus on online trading and potentially offer robo-advisory services (e.g., building an ETF-based portfolio remotely)
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Types of managed accounts: -Advisor-managed accounts: - Utilize advisor's expertise for investment and portfolio construction - Managed by licensed portfolio managers
- Separately managed accounts (SMAs):
- Employ external portfolio managers
- Clients hold individual security holdings
- Multi-mandate managed accounts (UMAs):
- Employ overlay managers to consolidate multiple client accounts into dedicated portfolios
- Offer coordinated approach to investing with professional portfolio management
- Private family offices:
- Full service to wealthy clients
- Handles full range of financial concerns (investments, estates, taxes, philanthropy)
- Separately managed accounts (SMAs):
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Types of non-managed fee-based accounts: -Full-service brokerage accounts: - Offer financial planning - Fixed/Unlimited number of trade - Fees based on account size - Include services in the package
-Self-directed brokerage account: - Offer services for account management - Include direct security and asset mix guidance and robo-advisory services (ETF-based portfolio building remotely).
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Description
Explore the different types of fee-based accounts, including managed and unmanaged accounts. Learn about the services offered, ownership structures, and various account management strategies. This quiz helps clarify the distinctions and functionalities of these financial instruments.
