When it comes to managing client portfolios, some registered investment advisors (RIAs) prefer to do it all themselves, researching and executing trades, while others employ the services of third-party asset managers. Now, TD Ameritrade Institutional1 has introduced an innovative, new alternative: Model Market Center.
This revolutionary platform lets independent RIAs on the TD Ameritrade Institutional platform leverage the brain power of leading money managers right from their desktops, without the constraints and complexity that come with outsourcing solutions.
With Model Market Center, advisors can select from a broad menu of third-party investment models in one, central location. The platform then seamlessly leverages iRebal® on Veo® — TD Ameritrade’s powerful trading and portfolio management technology — to execute those models in the manner they choose. As providers update their models, changes are automatically communicated to advisors.
For do-it-yourself advisors, Model Market Center can save the time spent building models from scratch, so they can devote more time working with clients and financial planning, while retaining investment management fiduciary control and responsibility, flexibility, and trading discretion.
And for those that employ traditional third-party platforms, Model Market Center can represent a less-costly alternative. A broad menu of models is available to advisors at no additional fee2, and there’s no investment minimum for assets held at TD Ameritrade Institutional.
“Investment management isn’t just time-consuming, it’s increasingly commoditized. Model Market Center lets advisors apply the investment strategies of well-known money managers with a few clicks. So though advisors must still research investment options and monitor models, our new platform can help them focus more on those activities that deliver greater value,” said Danielle Fava, director of product strategy and development at TD Ameritrade Institutional. “Advisors are increasingly seeking efficiencies. With this platform, we are delivering what we believe to be a more modern approach.”
Model Market Center currently offers access to a selection of models from eight investment managers:
- Anchor Capital Advisors
- CLS Investments
- Cambria Investments
- Goldman Sachs Asset Management
- Russell Investments
- State Street Global Advisors
- Wilshire Associates
- WisdomTree Investments
“And this is only the beginning. Model Market Center is an open-architecture platform and we expect to add more providers and models over time,” Fava said.
Keeping Pace Through Innovation
Many RIAs choose to outsource the work of investment management to third-party asset management platforms, also known as TAMPs, which help advisors by taking over full discretion of investment management and sharing of fiduciary responsibility in exchange for overlay fees.
Model Market Center presents a different approach. After advisors complete their due diligence they can subscribe to investment models and download them directly into iRebal on Veo®, the powerful, tax-efficient rebalancing tool available at no additional cost for accounts held with TD Ameritrade Institutional. There, advisors can implement one model or blend multiple models — including those they build themselves — based on the unique needs of each client account.
The models currently available are comprised of ETFs and mutual funds, but over time may include individual stocks and other securities. Some models leverage TD Ameritrade’s expanded menu of commission-free funds available through the ETF Market Center.
Since Model Market Center was activated on Oct. 30, more than 1,000 independent RIAs utilizing the TD Ameritrade Institutional platform have signed on; many are already putting the Model Market Center to work with their clients’ assets. Model Market Center represents yet another way TD Ameritrade Institutional is helping RIAs keep pace with accelerating technology change to optimize their firms.
“One of the top concerns we hear from advisors is they don’t have the time to create their own models, and yet SMAs can be expensive. So, we like the Model Market Center concept: it’s a good, low-cost alternative, particularly in investment areas where margins are thinner,” said Chuck Ballweg, co-owner of Prosperity Financial Group, Inc., an early adopter of Model Market Center. “I’m pleasantly surprised by the lineup of managers in the program: it’s very impressive.”
To Learn More
To learn more, TD Ameritrade Institutional clients can visit The Education Center on Veo® or contact their relationship manager. Other advisors are invited to call (800) 934-6124.
Material made available through the Model Market Center is provided by third-party Model Managers who are separate from and unaffiliated with TD Ameritrade. TD Ameritrade has not paid for or been involved in the preparation of the content, and has not verified, endorsed or approved the content. TD Ameritrade assumes no responsibility for any fact, recommendation, opinion, or advice contained in any such model portfolio or materials and expressly disclaims any responsibility for any investment decisions or for the suitability of any security or transaction based on it.
Model Market Center is an offering of TD Ameritrade, Inc. Registered Investment Advisor (RIA) that leverages iRebal® on Veo® technology to provide independent RIAs access to model portfolios provided by third-party asset managers. iRebal products and services are property of ThinkTech, Inc., an affiliate of TD Ameritrade, Inc.
ETFs are subject to risk similar to those of their underlying securities, including, but not limited to, market, investment, sector, or industry risks, and those regarding short-selling and margin account maintenance. Some ETFs may involve international risk, currency risk, commodity risk, leverage risk, credit risk, and interest rate risk. Performance may be affected by risks associated with non-diversification, including investments in specific countries or sectors. Additional risks may also include, but are not limited to, investments in foreign securities, especially emerging markets, real estate investment trusts (REITs), fixed income, small-capitalization securities, and commodities. Each individual investor should consider these risks carefully before investing in a particular security or strategy. Investment returns will fluctuate and are subject to market volatility, so that an investor’s shares, when redeemed or sold, may be worth more or less than their original cost. Unlike mutual funds, shares of ETFs are not individually redeemable directly with the ETF. Shares are bought and sold at market price, which may be higher or lower than the net asset value (NAV).
Information provided by TD Ameritrade, including without limitation that related to the ETF Market Center and commission-free ETFs, is for general educational and informational purposes only and should not be considered a recommendation or investment advice.
Particular commission-free ETFs may not be appropriate investments for all investors, and there may be other ETFs or investment options available at TD Ameritrade that are more suitable.
ETFs purchased commission-free that are available on the TD Ameritrade ETF Market Center are available generally without commissions when placed online in a TD Ameritrade account. Other fees may apply for trade orders placed through a broker or by automated phone.
TD Ameritrade receives remuneration from certain ETFs that participate in the commission-free ETF program for shareholder, administrative and/or other services.
No Margin for 30 Days. Certain ETFs purchased commission free that are available on the TD Ameritrade ETF Market Center will not be immediately marginable at TD Ameritrade through the first 30 days from settlement. For the purposes of calculation the day of settlement is considered Day 1.
1 TD Ameritrade Institutional is a division of TD Ameritrade, Inc., a brokerage subsidiary of TD Ameritrade Holding Corporation.
2 Standard TD Ameritrade Institutional custody fees and fund management fees apply. In the future, models that require a usage fee may be added to the platform.
About TD Ameritrade Institutional
TD Ameritrade Institutional is a leading provider of comprehensive brokerage and custody services to more than 6,000 fee-based, independent RIAs and their clients. Our advanced technology platform, coupled with personal support from our dedicated service teams, allows investment advisors to run their practices more efficiently and effectively while optimizing time with clients. TD Ameritrade Institutional is a division of TD Ameritrade, Inc., a brokerage subsidiary of TD Ameritrade Holding Corporation.
About TD Ameritrade Holding Corporation
Millions of investors and independent registered investment advisors turn to TD Ameritrade’s (Nasdaq: AMTD) technology, people and education resources to help make investing and trading easier. Online or over the phone. In a branch or with an independent RIA. First-timer or sophisticated trader. Our clients want to take control, and we help them decide how – bringing Wall Street to Main Street for more than 40 years. TD Ameritrade has time and again been recognized as a leader in investment services. Visit TD Ameritrade’s newsroom or amtd.com for more information.
Brokerage services provided by TD Ameritrade, Inc., member FINRA / SIPC
Source: TD Ameritrade Holding Corporation
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