Fee-Based Accounts Overview

A strategy to reduce taxable income by selling losing investments and offsetting capital gains.

This includes programs where advisors actively manage client portfolios based on pre-defined investment models tailored to specific client needs.

These programs are used temporarily, typically for clients who need short-term assistance due to illness or absence. Advisors handle accounts without using pre-defined models.

These accounts offer investors a higher level of control over their assets, allowing them to choose an external portfolio manager who manages their investments directly.

In SMAs, an external portfolio manager (sub-advisor) makes investment decisions based on a set model, and the actual securities are directly held by the client. This allows customization, including exclusion of certain investments and tax considerations.

A type of separately managed account (SMA) where a single portfolio model is used to manage investments across all accounts within a family or household. This approach aims to optimize tax efficiency and consolidate holdings.

A dedicated team of professionals that provides personalized investment management services to high-net-worth clients, typically for families or individuals with significant wealth.

A type of investment account where a group of experienced portfolio managers (sub-advisors) oversee investments based on specific client objectives. An overlay manager monitors the sub-advisors to ensure they are on track with the client’s investment goals.

The primary benefit of multi-manager accounts is the professional oversight provided by an overlay manager. This oversight helps ensure the underlying portfolio managers are aligned with the client's stated investment goals.

Multi-manager accounts benefit advisors by allowing them to focus more on the wealth management needs of their high-net-worth clients. The overlay manager handles the research and security selection workload.

A multi-mandate managed account (UMA) is a type of investment account where a client's assets are consolidated and managed by an "overlay manager." This manager acts as the main decision-maker, overseeing a team of specialized sub-advisors who manage different portions of the client's assets. By offering a customized mix of investment strategies, it allows clients to achieve their financial goals while mitigating risks.

The overlay manager is responsible for selecting and monitoring the performance of the sub-advisors who manage different parts of the client's portfolio. They act as the "manager of managers," ensuring that the overall investment strategy aligns with the client's goals and risk tolerance.

In a multi-mandate managed account, the client's assets can be divided into different "sleeves," each with specific investment strategies. This allows for tailored investment approaches based on the client's needs and goals.

Overlay managers conduct regular evaluations of the sub-advisors, assessing their performance and making adjustments to the portfolio as needed. They ensure that the sub-advisors continue to meet the client's objectives and that the overall investment strategy is aligned with the market environment.

By coordinating the efforts of the sub-advisors, the overlay manager helps to create a cohesive investment strategy for the client. They also provide valuable market insights and guidance, keeping the client informed about the broader economic environment.

A specialized type of investment management service offered to wealthy clients with assets exceeding $50 million. It provides a comprehensive range of financial services, including investment management, estate planning, tax planning, and more. The service is often provided by a team of professionals in one location.

A managed account gives a broker-dealer discretionary authority over a client's investments on an ongoing basis, meaning they can manage the account without constant client approval.

The Canadian Investment Regulatory Organization (CIRO) mandates that dealer members who handle managed accounts must be approved and comply with specific regulations.

A client must sign a managed account agreement, and their designated supervisor must approve it. The agreement must clearly outline the client's investment goals.

A designated supervisor must review managed accounts on a quarterly basis to ensure that the client's investment objectives are met and the account is managed in accordance with regulations.