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Committed to Independence
Envestnet | Tamarac’s recent acquisition of PortfolioCenter® highlights the challenge of maintaining independence as an RIA.  Morningstar’s commitment to providing an independent option will never waver.

Dermot O’Mahony, Head of Software Products

Feb 24, 2019


For 35 years, Morningstar has supported financial advisors in our shared mission to drive better financial outcomes for investors. We put investors’ interests first, and we believe that when the investor wins, we all win. We built Morningstar Office℠ to provide both independent research and performance-reporting capabilities for RIAs who are committed to putting their clients’ goals ahead of their own goals—and those of their solution providers. The advisor-client relationship requires the deepest trust and confidence, which begins when advisors are confident that their investment decisions and recommendations are based exclusively on the independent interests of their clients. We do not aspire to own the market on independent options; in fact, we think choice is good for investors and advisors. But the recent acquisition of Schwab PortfolioCenter® by Envestnet | Tamarac reduces the number of independent options available to RIAs, and we feel it is important to emphasize that our commitment to independence will not waver.

Morningstar’s independence is rooted in core bedrock principles.

We do not accept ‘pay to play’
We will not offer investments in our advisor software solutions favoring options that would disproportionately benefit our business. In fact, we will always seek to illuminate how firms —and their clients —can profit from good investment choices and strategy. We consistently rank first in the annual T3 Tech Survey for investment data/analytics—and the firms who rank second and third in the survey use Morningstar data to power their offerings. We continue to invest in, and add insight to, new data sets to help advisors make independent choices for institutional strategies, ESG analytics, multi-asset scenario analysis, and more. Unlike other model marketplaces, Morningstar does not accept incentives or payment from the asset managers participating in the marketplace.

Investors own their own data
Data security is important to investors and is an increasingly significant and difficult risk for advisors to manage. Independent RIAs have a clear obligation to understand how solution providers will use their stored data. Morningstar does not sell client data—to hedge funds or any other market participant—and we will always prioritize data security and the individual investor’s right to privacy.

You will always know the company we keep
Our CEO, Kunal Kapoor recently advised at the T3 Advisor conference that RIAs should “think closely about who (they) are partnering with. We have the opportunity to pick our partners. More than ever, we encourage advisors to not just learn about the services they use, but also to understand what’s behind it. Understand who you’re partnering with.” At Morningstar, we run our business with complete transparency, and for the long-term success of investors. We do not submit to short-term incentives that may compromise our long-term objectivity. We are careful of the company we keep and are vigilant in enrolling our council of advisors in the decisions we make. With full transparency into our data collection processes, stringent quality controls, and data use policies, our clients will never question our commitment to independence or the consequences of our innovations to their operations.   

For those committed to long term independence, understand the options
Since Schwab’s announcement, we’ve been fielding dozens of calls from advisors who are worried about an emerging threat to their independence. With large asset managers providing "free" technology solutions to advisors, and large software providers combining forces, it’s easy to fear that choice— the cornerstone of independence—is dwindling. This is compounded by concerns over practical considerations like the difficulty and costs of migrating data. As Tim Welsh expressed in a recent ThinkAdvisor article, “What advisors most fear when their systems get sold, is that the technology they are used to gets shut down, support levels are cut, and costly upgrades emerge.” When an unexpected change occurs, advisors have an opportunity to reevaluate their options and make an informed decision to choose a partner who puts their best interests—and even more importantly, the best interests of their clients—first.

We believe there’s never been a better time for great advice, and advisors who are committed to independence can take this opportunity to select a partner who believes in and supports their values.

We’re happy to offer Morningstar Office for up to 12 months free1 to current PortfolioCenter® users, as well as the following:

  • Free data conversion and a dedicated success manager
  • Two free passes each year of your subscription to the Morningstar Investment Conference, which includes free continuing education credits
  • Free Premium access for up to 250 clients for one year
  • Subscription to Morningstar® Magazine

1Morningstar will provide you with a prorated credit of four months’ worth of subscription fees for each 12-month period for which you initially subscribe -- up to a total of 12 months’ worth of credit on your subscription fee payments. For instance, if your initial subscription term were 24 months’ time, Morningstar would provide you with a prorated credit of eight months’ worth of subscription fees on your paid subscription.

2Not valid on prior paid registrations. Offer may not be combined with any other sale, promotion, discount, code, coupon and/or offer. Offer cannot be sold or transferred. Void where prohibited.

Financial Advisor Technology Trends

The 2019 T3 Software Survey Report collected responses from 5,508 advisors to evaluate the advisor tech marketplace.

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