GeoWealth's Jen Wing Pinpoints How Advisors Use ETFs.

Jen Wing is a senior vice president, head of investment solutions at GeoWealth, where she is responsible for delivering on the broad range of investment needs of its clients, ensuring that the GeoWealth platform offers access, flexibility, and investment expertise. 

Jeff Benjamin: What kinds of investing trends are you seeing from financial advisors on your platform? 

Jen Wing: Financial advisors are segmenting their approach for different client bases in three main buckets: aspiring affluent, mass affluent and high net worth clients. For aspiring affluent clients, they’re either using a suite of risk-based third-party ETF models or building their own advisor-led models to keep it simple. 

For mass affluent clients, they’re combining models from multiple managers. For both mass affluent and aspiring affluent, financial advisors are moving into ETF-only models. For scale and compliance reasons, gone are the days of creating custom solutions for individuals that don’t require it. 

For high-net-worth clients on the other hand, we’re seeing more customization in the form of direct indexing combined with separately managed accounts for both individual equities and fixed income. 

JB: In terms of ETF flows, what are advisors using to build client portfolios? 

JW: Passive equity continued to drive flows in 2023. SPY ETF assets on our platform more than doubled in both advisor-managed and third-party institutional models. 

Fixed income became in vogue again in 2023. In line with industry trends, we saw overall net outflows from short duration ETFs and net inflows into longer duration ETFs as a result of the Fed pivot. On the other end of that spectrum, we’re working with clients to help them navigate getting their investible cash to work into short-term investments now that yield is available. 

I’m not big on sports analogies but from my perspective the liquid alternative ETF space is still in its first inning. That being said, we are seeing demand for strategies that utilize options, such as buffered ETF models, as well as income producing strategies that leverage call writing or put writing. 

JB: What are some of the broader trends you’re seeing across the wealth management industry right now? 

JW: Asset managers that didn’t jump on the ETF trend years ago are jumping in now. Mutual fund conversions and new launches continue. 

Within the ETF wrapper, active ETFs continue to launch and garner assets. All things being equal, our portfolio managers would choose an ETF over a mutual fund any day, due to the tax efficiency, costs, and accessibility. 

JB: What are some ways you’re seeing advisors leverage technology in building portfolios? 

JW: Unified managed accounts continue to grow in popularity in the wealth management space, which are enabled by technology that has made UMAs more accessible and cost effective. A UMA allows the advisor to consolidate a client’s managed assets into one account, instead of needing a separate account for each strategy. This means less paperwork, more simplicity, and more scale.  

According to the recent Cerulli report, the volume of assets covered by UMA programs will increase from $2.1 trillion at the end of 2022 to $3.7 trillion by the end of 2026. Importantly, not all technology platforms are created equal when it comes to UMAs.  

JB: Can you talk about the trend toward customization in client portfolios? 

JW: RIAs want to maintain control of their business, which means customization is critical to their technology program and investment selection. 

Last year, we partnered with a large client to launch a turnkey UMA program. We designed a set of risk-based UMAs dedicated to mass affluent and high net worth clients that can be white labeled and come with customized content and collateral for end clients. We’ve seen customization throughout this program as RIAs choose to align our products with their preferences, whether it be to reduce underlying manager fees, add income, or make it more tactical. 

The drive for customization has also spurred the popularity of direct indexing.  

Contact Jeff Benjamin at [email protected] and find him on X at @BenjiWriter