A summary of changes to firms and strategies so far in 2012.
In January 2012, Morningstar released the ETF Managed Portfolios Landscape Report, a comprehensive review of strategies that have more than 50% of portfolio assets invested in exchange-traded funds. These strategies represent one of the fastest-growing areas of the managed-account space. The initial landscape report tracked nearly 370 strategies from 95 firms with collective assets under advisement, or AUA, of $27 billion as of September 2011--a 43% growth rate over the previous 12 months. Click here for access to the full landscape report.
Since the report's release, we have taken another look at some of the strategies in the database and revised their attribute designations. A handful of strategies have been discontinued, and one team has moved to new home.
Attribute Changes for Windhaven and Nuveen
Advisor Windhaven Investment Management (a wholly owned subsidiary of Charles Schwab) offers three ETF managed portfolios: Aggressive, Growth, and Conservative. Collectively they hold more than $10 billion in assets, as of March 31, 2012, making Windhaven the largest manager in our database. After reviewing the strategies, we have changed the Portfolio Implementation attribute to Hybrid from Strategic. The strategies utilize a core and satellite approach, using a core sleeve of investments along with a tactical sleeve that can opportunistically invest in ETFs on a global basis as well as go to cash.
Nuveen's three Intelligent Risk portfolios (Aggressive, Conservative, Moderate) focus on both risk and return, and utilize the same underlying investment philosophy across all strategies. As a result, it's appropriate to align the attributes, so we've updated the Conservative strategy's attributes to Global, All-Asset, Tactical, Broad-Market (the last attribute remains unchanged).Mesirow Team Finds New Home at Roosevelt
Mesirow's three international equity strategies are managed by a seven-person team led by Leila Heckman, John Mullin, and Vijay Chopra. In January 2012, the entire team was lifted out of Mesirow to Roosevelt Investment Group in New York with Mesirow's blessing. The team ported the track record of its three strategies to Roosevelt and will continue to manage the strategies in the same manner as before.No Longer Checking In
A handful of strategies have stopped reporting information to Morningstar, and as such, they have been removed from the database. This is a common occurrence in the managed account space and can be the result of a variety of reasons, including closing strategies to new investors or simply no longer offering a specific strategy to the market place.
As mentioned in our overview of the landscape report, the industry response to the landscape report has been tremendous. We anticipate tracking more than 500 strategies with $42 billion in strategy assets through March 31, 2012. We'll be analyzing potential new strategies that have been added to our separate-account database for inclusion in this universe in the coming weeks.