Morningstar, iCapital Partner to Bring Advisors Alt Investments

Morningstar has teamed up iCapital to provide financial advisors with access to alternative investments and analytics.

By Rethinking65

Morningstar has teamed up iCapital to provide financial advisors with access to alternative investments and analytics.

As a result of the partnership, more than 170,000 people who use Morningstar’s Advisor Workstation will now be able to use alternative investment research to compare private assets with traditional investments, Morningstar said in a press release Jan. 17.

“Advisors will be able to include alternatives alongside traditional investments in model portfolios, reports, and proposals,” said Vimal Vel, chief product officer for Morningstar’s Enterprise group.

Lawrence Calcano, iCapital’s chairman and CEO, said Advisor Workstation users will not only have access to alternative investments, but also educational resources to make decisions on portfolio allocations and diversification strategies.

The two companies recently completed the first phase of the integration, which provides advisors with access to iCapital Marketplace and iCapital Architect. The marketplace tool offers alternative funds, due diligence and educational resources, fund subscription processing and third-party reporting. Architect offers portfolio construction and analysis tools.

During the first half of this year, the integration will be available to Advisor Workstation’s enterprise-level clients.

According to a Morningstar study, advisors allocate between 14% and 19% of assets under management to alternatives, such as cryptocurrency, structured products, liquid alternatives, REITs, private debt and private equity.

Meanwhile, an iCapital study of 400 RIAs found 36% of advisors use alternatives and allocated between 5% and 15% of portfolios to them. The study also said that half of advisors say client interest in alternatives has risen over the last two years.

As of Nov. 30, New York-based iCapital serviced more than $172 billion in global client assets.

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