The issue, according to LPL, is specific “to Morningstar Office reporting functions “and does not affect other Morningstar applications.
“We continue to work with Morningstar in many other ways, and we continue to work with them to help resolve this issue,” it explained.
In an email sent to ThinkAdvisor on Friday afternoon after LPL clarified the situation, Schatzow said: “It makes sense that it [seems to] only appl[y] to hybrid advisors, because a truly independent investment advisor that only maintains accounts at LPL should be free to use any software or product that they want.”
He added: “It seems like the statement suggests it only impacts 25 LPL hybrid advisor offices. I am curious whether any other LPL representatives are impacted by this decision.”
Morningstar said Friday in a statement: “We value our long-term relationship with LPL, and we are disappointed by their decision not to allow their advisors downloading LPL data to use Morningstar Office for consolidated reporting.”
The IBD’s decision “is not related to the quality or computation of Morningstar’s data or research, and it does not relate to any other Morningstar products or services,” the firm added.
The discussion over the LPL-Morningstar relationship comes less than a month after the independent broker-dealer added the research analytics platform YCharts into its vendor program for advisors.
It also follows communications between LPL and its advisors around Morningstar Office, which were unrelated to hypothetical back-tested performance.
“LPL has requested unique modifications to the advisor reporting functions of Morningstar Office, and we have received no similar requests from any other client,” Morningstar explained.
“Over the past several years, our teams have implemented many customizations to support LPL’s unique needs. We are continuing discussions with LPL to determine if there are reasonable ways to meet their new set of specific requests while not sacrificing core Office functionality for our clients,” the research firm added.