From the August 2013 issue of Research Magazine • Subscribe!

Merrill Edge Adds Portfolios

Merrill Edge, the mass-affluent channel of Bank of America-Merrill Lynch, says it has introduced two income-focused portfolios to this platform. With the Merrill Edge Income Portfolio and the Income & Growth Portfolio, there are now 12 portfolios available on the platform. The portfolios are actively managed and typically have eight to 16 positions in mutual funds and ETFs, a $20,000 investment minimum and a 1% yearly management fee.

“The first Merrill Edge portfolios were launched [in January 2012] to drive total return and were aligned with the interests of clients who want to grow assets and maximize returns in the accumulation stage of their investments,” said Alok Prasad, head of Merrill Edge, in an interview. “The two new portfolios are more income oriented and are designed for those nearing or in retirement who want to augment their savings with income.”

The two income-focused portfolios include a variety of fixed-income securities and related products—including emerging-market bond funds, floating-rate products and REITs, according to Tom Halloran, head of Merrill Edge product development.

Earlier this year, Bank of America rolled out the Merrill Edge Roadmap, a financial-planning tool for its 1.6 million mass-affluent Merrill Edge clients. As of June, it had some 1,800 Merrill Edge “financial solutions advisors,” with about 1,000 located in BofA branch offices.

“The asset levels in our Merrill Edge portfolios are far exceeding our expectations,” Prasad shared. “We keep our ears close to the ground to understand our clients and their goals.”

The two new portfolios “open up the door for clients to take advantage of important options, income-oriented portfolios for those in retirement,” noted Halloran. “We are earlier in the process [of launching income-focused products] than some competitors, and we’re off to go start.”

As for the shape of future Merrill Edge portfolios, “It’s very conceivable that we might add portfolios with other dimensions and options in the future,” he explained. “There’s definitely room there to give clients more options and potentially more asset classes.”

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