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What You Need to Know

  • Fidelity adds a health care and international growth SMAs to its lineup, which now numbers seven.
  • SMA demand is increasing as advisors search for more customized investment strategies.
  • Fidelity has nearly $10 trillion in AUA and offers model portfolios and other advisor solutions.

Fidelity Investments has expanded its lineup of separately managed accounts for advisors to seven, adding a health care and an international growth SMA.

The FA Health Care SMA and FA International Growth SMA — the FA stands for Fidelity Advisor— are available through broker-dealers, RIAs and management account platform providers.

They are actively managed accounts based on existing Fidelity mutual fund strategies though more concentrated, with fewer stocks, and led by the same leading portfolio managers for those strategies — Eddie Yoon for the health care SMA and Jed Weiss for the international growth SMA.

Other management team members are Zach Dewhirst for both SMAs and Kevin Smith and Anna Piralkova for the international growth SMA.

“We are committed to providing choice and flexibility and are excited to expand our SMA lineup as advisors continue to look for investment strategies that can be tailored to their clients’ specific needs and preferences,” said Matt Goulet, senior vice president, Portfolio Solutions, in a statement.

Yoon, the lead manager for the Fidelity Advisors Health Care SMA, said in a statement that “the pandemic has reinforced the importance of engaging investors in conversations around health and wellness,” and the new Health Care SMA “is designed to capture innovative opportunities in the U.S. health care industry.”

Goulet tells ThinkAdvisor that demand for SMAs is increasing as more advisors move into unified managed accounts for clients, which include SMAs as well as other investment structures such as ETFs and mutual funds, and which provide advisors more flexibility and customization for client accounts.

“That’s where we think the growth will be,” says Goulet, referring to SMAs and UMAs. The typical minimum for an SMA is $100,000.

As of Jan. 31, Fidelity had assets under administration, including $3.8 trillion in discretionary assets. Its SMA models are just one component of a suite of portfolio construction solutions, which also include Fidelity Model Portfolios and which are all accessible through the Fidelity Managed Account Xchange.

Its other SMAs are the International Capital Appreciation SMA, Growth Opportunities SMA, Small Company SMA, Women’s Leadership SMA and Founders SMA, which invests in companies led by their founders.

(Photo: Shutterstock)


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