This edition of the Investments Roundup features RFG launching Bluemonte ETFs, iCapital’s survey finding on advisors embracing alts, CAIS launching model alts portfolios, Cetera introducing alts allocation models, Morningstar reporting on accelerating demand for model portfolios, Nuveen buying Brooklyn Investment, Captrust partnering with Eaglebrook on crypto offerings, William Blair forecasting slow payoffs for AI investors, Orion collaborating with J.P. Morgan on SMAs and model portfolios, HFR reporting on hedge funds’ gains and launching two new indexes, IIA introducing a CE program with a course on index investing and William Blair appointing Robert D. Kendall as Global Head of Investment Management.
Larry's Take
At WSR, we frequently cover AI as a tool to enhance and create new mechanisms for advisor and firm productivity. There’s another side to AI that also attracts the interest of wealth management – AI investments. AI isn’t just a tool, it’s something your clients may clamor to invest in.
The buzz around AI has driven certain stocks – such as chip manufacturers – to very high valuations, as well as adjacent investments such as energy production to power data centers. This month, William Blair issued a report that explains why it may take longer than investors anticipate for their AI investments to produce the desired results. I know very few people who are bearish on AI, but returns are measured against timeframes, so bulls need to know not only how bullish they are, but how bullish they are on an annualized basis. Clients often forget this when the buzz gets too loud, and it pays to remind them.
If you would like to discuss this Larry’s Take further, including how these trends might impact your business, please contact me at larry.roth@rlrstrategicpartners.com.
RFG Advisory Launches Bluemonte ETFs To Solve ‘Real-World Challenges’
Birmingham, Alabama-based RFG Advisory announces the launch of Bluemonte ETFs, a suite of exchange-traded funds that the firm said were “designed to streamline portfolio construction, deliver consistent, client-aligned outcomes and enhance tax efficiency,” while working as a “complete asset management strategy.”
The ETFs are available to both RFG and non-RFG advisors. The company said advisors can integrate the ETFs into RFG-managed portfolios or use them independently without additional fees. RFG had over $4.9 billion in assets under management (AUM) and almost $6 billion in assets under advisement as of March 31.
“Bluemonte was built to solve for the real-world challenges Advisors face, including managing client outcomes, controlling for risk and eliminating friction,” said Rick Wedell, President and Chief Investment Officer at RFG. “By creating a unified ETF ecosystem, we can better manage asset allocation, minimize style drift and enhance tax efficiency. Critically, because portfolio repositioning takes place within the ETF wrapper itself, Advisors can avoid generating taxable events in individual client accounts.”
iCapital Survey: Advisors Embrace Alts As Portfolio Growth Engine
Advisors are increasingly embracing alternatives as a growth engine for clients’ investment portfolios, viewing them as essential, multi-purpose portfolio components and no longer just part of diversification strategies, according to iCapital’s new “2025 Global Advisor Survey.”
As alternatives increasingly become structural components of portfolios, technology and implementation now rank as the top advisor priorities, iCapital said.
Attracting new clients is the top driver of alts engagement in the U.S., according to the online survey of 603 registered financial professionals. A whopping 96% of advisors surveyed said they planned to maintain or increase their exposure to alts over the next year. Private equity (66%), credit (56%) and hedge funds (54%) are the most favored asset classes. Alts education for advisors is also a top priority, according to iCapital.
“Advisors worldwide are embracing alternatives, and their message is clear: with growing allocations, technology solutions are key,” the firm said. The focus of advisors has “shifted from ‘why alternatives’ to scaling operations, personalizing client portfolios, and running efficient, risk-managed businesses.”
CAIS Launches Alts Model Portfolios, Expanding Platform Options
New York City-based CAIS, an alternative investment platform for independent financial advisors, launches new model portfolios developed by BlackRock, Carlyle, Franklin Templeton and KKR onto the CAIS Models Marketplace. BlackRock and Carlyle each offer three single-manager portfolios on the CAIS platform that blend private equity and credit with public market exposure, tailored to various risk profiles and investment goals.Franklin Templeton contributes a multi-manager model with allocations across private credit, real estate, infrastructure, private equity secondaries and asset-backed finance to the platform. KKR adds three proprietary models designed to generate income, preserve capital and boost returns through exposure to private equity, credit, real estate and infrastructure.
“Alternative investment models give advisors a powerful tool to deliver more personalized portfolios, while helping to streamline operational complexity and scale allocations,” said Neil Blundell, Chief Investment Officer at CAIS Advisors and Head of Investments at CAIS. “By packaging multiple alternative investment strategies into a single, professionally designed solution, advisors can focus more on their clients and less on manager selection.”
Cetera Introduces Alts Allocation Models For Private Credit, Equity And Real Estate Exposure
San Diego-based Cetera Financial Group introduces its first alts allocation model as a simplified way for advisors to provide alternative investments to clients. Cetera Blended Alternatives Model - Moderate includes six alts funds with exposure to private equity, credit and real estate investments.
The new model, created in partnership with iCapital, is the first of several alts models Cetera is planning. Cetera has more than $554 billion in assets under administration and $246 billion in AUM.
"Especially for high-net-worth clients, financial advisors should have access to alternative investments as another tool within their overall financial planning strategy because alternatives can help dampen the effects market volatility has on a client's investment portfolio," said Matt Fries, Head of Investment Products and Partner Solutions for Cetera. "There's been tremendous change in the alternative investments marketplace in the past 10 years, spurring greater client awareness of and demand for alternative investments, which have become a more mainstream tool for advisors constructing modern client portfolios."
Morningstar: Demand For Model Portfolios Is Accelerating Among Advisors
Advisor demand for model portfolios is accelerating, according to Morningstar’s “U.S. Model Portfolio Landscape” report. Model portfolios saw net inflows of $37.8 billion last year, representing an increase of 62% from 2023, Morningstar said.
A notable trend is the popularity of custom model portfolios that allow advisors to take advantage of the efficiency of models while tailoring them to client needs. Morningstar also said a third of firms expect to incorporate private assets into their model portfolios in the next three years, reflecting investors’ growing interest in private markets. Manager Research Analyst Stephen Margaria is the Lead Author on the report.
“Financial advisor demand for model portfolios shows no sign of slowing down,” noted the report. “Model portfolios allow advisors to outsource some, or all, of their portfolio management responsibilities to focus on more holistic financial planning.”
Nuveen Buys Brooklyn Investment, A Direct Indexing Firm
Nuveen, an asset manager with $1.3 trillion in AUM, acquires direct indexing firm Brooklyn Investment Group, along with its parent company, Brooklyn Artificial Intelligence. The companies plan to integrate Nuveen’s alts and lifetime income offerings into tax-advantaged solutions, as well as leverage Brooklyn’s client onboarding, maintenance and reporting technology on Nuveen’s advisor channel.
Nuveen and Brooklyn have worked together since 2023, when the two companies partnered on traditional direct indexing, tax-advantaged long-short portfolios and multi-asset tax-managed solutions. That year, Nuveen and TIAA Ventures also took a minority stake in Brooklyn.
“Every day we hear from advisors about the demand for personalized multi-asset strategies with the returns that private market allocations offer,” said Bill Huffman, CEO of Nuveen. “Through this partnership, we'll unlock smart, always-on tax-management and combine the market expertise that distinguishes Nuveen and the innovative technology that Brooklyn has pioneered.”
Captrust Expands Crypto Offerings Through Partnership With Eaglebrook
Raleigh, North Carolina-based RIA Captrust partners with Eaglebrook Advisors for its crypto investment platform for wealth managers. The deal allows advisors in Captrust’s network to bring direct and tax-optimized digital asset investments to their clients through Eaglebrook’s platform.
Founded by CEO Christopher King, Eaglebrook is a provider of tax-optimized Bitcoin and Ethereum separately managed accounts (SMAs), custom SMAs and managed strategies. Captrust has over $1 trillion in total client assets as of Dec. 31.
“[Captrust’s] trust in Eaglebrook is a powerful signal that direct bitcoin investments, with tax alpha, no ETF tracking error, and integration to advisor workflows has arrived in the wealth channel,” said Christopher King, Founder and CEO at Eaglebrook. “This is a pivotal moment for both Eaglebrook and the adoption of bitcoin and digital assets in the wealth management market.”
William Blair Forecasts Long Timeline For Full AI Payoff
AI technologies are expected to transform industry, but whether and when investors will benefit is uncertain. The timeline to financial payoff may prove to be much longer than investors expect, according to William Blair Investment Management’s report, “AI: The Challenges for Investors.”
According to the report, as with previous transformative technologies, like the steam engine, the economic impact of AI could emerge over decades rather than years as organizational capabilities and supporting infrastructure develop. The rush of investment into AI may not drive corporate profits in the near term. Initially, companies may have to invest to stay competitive, while consumers may derive more benefits in the coming years than shareholders do.
“Investors must recognize that the journey toward AI’s trillions of dollars in impact is both intricate and protracted—a transformation unfolding as gradually as the evolution from a solitary light to a fully furnished home complete with all its essential appliances,” writes Gurvir Grewal, Global Research Analyst at William Blair. “Yet this steady progression often clashes with a market that rapidly reprices assets based on shifting narratives, a dynamic tension that poses constant challenges.”
Orion Collaborates With J.P. Morgan On SMAs And Model Portfolios
Omaha, Nebraska-based Orion adds SMAs and model portfolios from J.P. Morgan Asset Management to its advisor platforms. Advisors can now choose from five equity SMAs and two model portfolios. The SMAs include options for large cap growth, equity income, growth, large cap and U.S. equities. The model portfolios are Strategic ETF and Tactical ETF models. Orion serviced $4.7 trillion in assets under administration and $98.6 billion of client assets as of March 31. J.P. Morgan had $3.7 trillion of AUM as of the same date.
“We’re excited to bring J.P. Morgan’s SMA and model portfolio strategies to the Orion platform, offering advisors even greater flexibility and choice when building portfolios for their clients,” said Ron Pruitt, President of Orion Wealth Management. “By expanding the range of high-quality, professionally managed strategies available on our platform, we continue to empower advisors to deliver investment solutions that help their clients meet their financial goals with confidence.”
HFR Reports Hedge Fund Index Rises In June, Launches New Indexes
In June, hedge funds had their strongest monthly gain since December 2023, ending the second quarter with momentum, according to hedge fund analysis firm HFR. The HFRI Equity Hedge (Total) Index rose 3.4% for the month, while the HFRI Event-Driven (Total) Index increased 3.2%. Though the quarter began with great investor uncertainty around trade, tariffs and legislation, it finished with an improving outlook for the second half of the year.
HFR forecasts more hedge fund inflows as institutional investors increase allocations to funds with proven track records. In addition, HFR launches two new indexes: the HFRI Asset Weighted Composite (ISW) and the HFRI Assets Weighted Composite (EWS).
“The robust 2Q performance occurred against a backdrop of dramatically shifting drivers that began clouded by policy uncertainty, geopolitical risk, trade/tariff volatility, all of which evolved into significant policy clarity over the quarter stemming from passage of legislation, reduced geopolitical uncertainty and improving economic outlook,” said Ken Heinz, President of HFR. “Furthermore, hedge fund launches have increased while liquidations have fallen to historic lows with total industry assets at record highs.”
IIA Introduces CE, Starting With A CFP Board-Approved Course
The Washington, D.C.-based Index Industry Association (IIA) announces a continuing education program for financial professionals that launches with its first course on index investing. The free webinar, “The Important Role of Indexes to Financial Markets and Investing,” is eligible for CE credit and approved by the CFP Board. The three-part course is taught by three IIA experts: Anu Ganti, US Head of Index Investment Strategy at S&P Dow Jones Indices; Lauren Young, Senior Director, Index Governance at Cboe Global Markets; and Rolf Agather, Head of Product and Research at Morningstar Indexes. IIA’s members include Bloomberg Indices, CBOE Global Indices, China Securities Index, FTSE Russell, Hang Seng Indexes, ISS-STOXX, Morningstar, MSCI, NASDAQ OMX and others.
“Indexes play an important role in the global financial ecosystem, and yet we find that many audiences – including investors – would benefit from a richer understanding of how indexes are created and used across global financial markets,” said Kirsten Wegner, CEO of IIA. “The IIA’s CE program is designed not only with financial professionals in mind, but for investors, consumers and policymakers alike, reflecting our ongoing commitment to transparency, education and informed dialogue across the financial ecosystem.”
William Blair Appoints Robert D. Kendall As Global Head Of Investment Management
William Blair announces the naming of Robert D. Kendall as Global Head of Investment Management. Kendall will lead the firm’s strategies in portfolio management, client and operational activities. He takes over from Stephanie Braming, who plans to retire later this year.
Kendall brings nearly three decades of asset management experience, most recently was President of Raymond James Investment Management. Prior to that he helped found, and served as CEO for, DWS Americas, which is an asset management subsidiary of Deutsche Bank.
“I am thrilled to be joining William Blair and look forward to building upon the firm’s long heritage of helping clients achieve their investment goals,” said Kendall. “I have been impressed with the firm’s private partnership structure that drives a tremendous culture of client focus, collaboration, integrity, and excellence.”
Wealth Solutions Report can be reached at info@wealthsolutionsreport.com.
