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UBS, Envestnet and iCapital Team Up on New Alternatives Exchange

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What You Need to Know

  • The firms teamed to offer a curated selection of UBS and iCapital alternative investment products through Envestnet’s platform.
  • The investments will include hedge funds, private equity, private credit, venture capital and real estate.
  • Access to the Alternatives Exchange will be made available in the current quarter.

UBS has teamed with fintech firms Envestnet and iCapital Network to provide clients with access to a curated selection of UBS and iCapital alternative investment products that include hedge funds and real estate through Envestnet’s platform, the companies said Tuesday.

As part of the initiative, Envestnet will launch the Alternatives Exchange, a new solution designed to provide the alternative products to clients, leveraging iCapital’s turnkey technology. Access to the Alternatives Exchange will be made available in the current quarter directly through a single sign-on integration from the Envestnet Platform, the companies said in their joint announcement.

UBS created a dedicated group to service the initiative that will provide access to investment solutions and custody services. Advisors on Envestnet’s platform will continue to be the main contact for their clients.

To seamlessly support the new initiative, Envestnet | PMC, Envestnet’s portfolio consulting group, will provide oversight of the Alternatives Exchange. Envestnet’s new Private Wealth Consulting service “anticipates leveraging this offering for advisors of high-net-worth clients, providing access to private investments and hedge fund strategies through UBS and iCapital,” the firms said.

Through the collaboration, Envestnet’s platform will provide access to iCapital’s enhanced technology and processing capabilities. iCapital’s technology includes its digital subscription process for alternative investments, with Anti-Money Laundering and Know Your Client features to assist advisors through essential compliance processes.

It was not immediately clear if cryptocurrency will play any role in the alternative investments initiative. The companies did not immediately respond to requests for comment. UBS said in April that it was in the early stages of planning to offer wealthy customers digital currency investments, joining a growing number of U.S firms, including Morgan Stanley, in seeking to give broader access to crypto in response to client demand.

Investment-related documents and reports will be made available in real time via iCapital’s intuitive document center, “digitizing a historically paper-intensive, cumbersome experience and strengthening advisor efficiency,” the companies said.

“As advisors seek to navigate challenges presented by a low-yield environment and better diversify traditional equity and fixed-income portfolios, we believe alternative solutions can be another option used to enhance client investment outcomes,” according to Dana D’Auria, co-chief investment officer of Envestnet.

“Through this collaboration, the new Alternatives Exchange will not only provide access to hedge funds, private equity, private credit, venture capital, and real estate, but will also provide the research, due diligence, and digital technologies to help invest in these strategies more efficiently — all on one platform,” she said in a statement.

“UBS has a long history of partnering with leading technology companies, like Envestnet and iCapital, to help broaden the firm’s distribution network of its products and services,” according to Tom Naratil, president Americas at UBS. “This strategic relationship will enable us to scale our product offering for investors and strengthen our position in the alternative investments sector.”

 (Photo: Shutterstock)