New Platform Offers Research, Education and Due Diligence
BOSTON -- Fidelity Institutional -- the division of Fidelity Investments® that provides clearing, custody and investment management products to registered investment advisors, broker-dealers, family offices and banks -- today announced the launch of a new comprehensive and streamlined solution for accessing alternative investments. Fidelity’s platform will provide research, education and third-party due diligence, as well as access to a wide range of alternative investment products for all Fidelity Institutional clients.
Fidelity is already a leading provider of custodial services for alternative products. Through this new platform, financial advisors and family office professionals will now have access to a variety of alternative investment products, including hedge funds, private equity funds and ’40 Act mutual funds. Fidelity’s platform will also provide access to research and third-party due diligence reports through strategic alliances with leaders in the space -- including CAIS, Goldman Sachs Asset Management (GSAM) and Morningstar –- distinguishing it from other firms that only offer access to alternative products. In addition, through Fidelity’s Alternative Investments Network, financial advisors and family office professionals will have access to a list of alternative investment funds from third-party sponsors with reduced custody fees.
“This platform was built on insights from our clients regarding the challenges they face incorporating alternative investments into their clients’ portfoliosi,” said Mark Haggerty, head of Fidelity Institutional’s product group. “Delivering access to leading products was a priority, but we also invested in providing institutional-quality third-party due diligence, insights and education and a simplified and consistent pricing structure. These features will be critically important to helping our clients effectively leverage this investment strategyii.”
In addition to the insights and education provided on the platform, Fidelity will conduct several in-depth, in-person Alternative Investment Forums to keep clients up to date on the changing landscape of alternative investments. Fidelity’s strategic alliances with CAIS, GSAM, and Morningstar will also provide financial advisors and family office professionals with research and education on alternative investments:
• CAIS will provide access to a centralized and diverse menu of leading hedge funds at reduced minimums, independent third-party due diligence and monitoring provided by Mercer, portfolio construction tools and an automated electronic subscription process.
• GSAM’s Alternative Investments & Manager Selection (AIMS) Group will provide access to portfolios of leading external hedge fund and private equity managers across various alternative investment strategies, utilizing its rigorous process of selecting managers, constructing portfolios and managing risk. Additionally, GSAM will offer alternative investment thought leadership through the platform.
• Fidelity’s platform will offer an advisor education center powered by Morningstar, Inc. and provide analyst insights on how and when advisors and their clients might want to use alternatives in their portfolios, comprehensive market research to help assess alternative asset categories and information on market trends. Morningstar Associates, a registered investment advisor and wholly owned subsidiary of Morningstar, Inc., will provide a select list of alternative mutual funds to advisors.
Fidelity will continue to offer comprehensive services for financial advisors and family office professionals using the platform, including aggregated reporting, custody, trading, clearing and execution. In addition to a continued investment in the DTCC AIP platformiii, Fidelity plans to offer seamless integrations into the WealthCentral and Streetscape platforms
with CAIS, GSAM and Morningstar. Together, these services and features will provide financial advisors and family office professionals with greater accessibility to alternative investments and a streamlined process for incorporating them into clients’ portfolios.
About Fidelity Investments
Fidelity Investments is one of the world’s largest providers of financial services, with assets under administration of $4.4 trillion, including managed assets of $1.9 trillion, as of September 30, 2013. Founded in 1946, the firm is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and many other financial products and services to more than 20 million individuals and institutions, as well as through 5,000 financial intermediary firms. For more information about Fidelity Investments, visit www.fidelity.com.
ii “The Mainstreaming of Alternative Investments: Fueling the Next Wave of Growth in Asset Management,” McKinsey, June 2012.
iii According to the Depository Trust & Clearing Corporation’s website, the Alternative Investment Product (AIP) suite of services is a platform that links global market participants – including broker-dealers, fund managers, fund administrators and custodians – to provide one standard end-to-end process for alternative investments such as hedge funds, funds of funds, private equity, non-traded real estate investment trusts (REITs), managed futures and limited partnerships.
Morningstar, CAIS, Goldman Sachs and Mercer are independent companies and unaffiliated with Fidelity Investments. There is no form of legal partnership, agency, affiliation, or similar relationship between these third-party service providers and Fidelity Investments.
Service marks appearing herein are the property of FMR LLC.
Clearing, custody or other brokerage services may be provided by National Financial Services LLC, or Fidelity Brokerage Services LLC. Members NYSE, SIPC. 200 Seaport Blvd, Boston, MA 02210.
Fidelity Investments Institutional Services Company, Inc., 500 Salem Street, Smithfield, RI 02917