Core Insights - Tax harvesting is expected to become the most in-demand customization feature in portfolio construction as solutions become more available [1][2] - Advisors rated tax harvesting a 3.7 out of 5 in terms of demand among portfolio construction features [2] - Other customization features include vehicle integration of ETFs (3.3), customized withdrawal plans (3.2), and managing concentrated positions (3.1) [2] Portfolio Construction Drivers - The primary drivers for portfolio construction decisions among advisors are maximizing risk-adjusted returns (44%), maximizing diversification and asset class coverage (41%), and creating long-term wealth growth (39%) [3] - For Registered Investment Advisors (RIAs), changes in clients' goals/risk profiles (89%) and liquidity needs/life events (86%) are the most important drivers for portfolio allocation changes [4] Advisor Relationships with Asset Managers - A significant majority of advisors (85%) collaborate with multiple fund managers for portfolio construction advice, with RIAs at 76%, wirehouse advisors at 88%, and independent broker/dealers at 91% [5] - Advisors prioritize risk analysis (55%) and portfolio optimization (53%) when seeking portfolio construction services from asset managers [6] - Over 60% of advisors rated the importance of meeting with an investment specialist as 3.7 out of 5 [6]

Core Insights - Envestnet has launched BlackRock custom model portfolios for registered investment advisors (RIAs) at its Elevate conference, enhancing portfolio customization capabilities [1][2]. Group 1: Offering Details - The new offering provides RIAs with streamlined access to BlackRock's custom model capabilities, including traditional public markets ETFs, mutual funds, Separately Managed Accounts (SMAs), and alternative exposures [2]. - This collaboration combines BlackRock's portfolio design and risk management expertise with Envestnet's managed account platform, allowing RIAs to deliver personalized and tax-efficient investment strategies [2][3]. Group 2: Strategic Benefits - The enhanced offering aims to provide advisors and clients with access to institutional-quality portfolios, fostering more strategic and personalized advisor-client relationships [4]. - RIAs can scale their practices more efficiently, reduce operational risk, and focus more on client relationships, as firms allocating over 75% of their practice to model portfolios achieve higher valuations [4]. Group 3: Market Position and Growth - BlackRock is a leading provider of model portfolios, managing approximately $300 billion in assets globally, with expectations for managed model portfolios to double from $5 trillion to $10 trillion over the next four years [6]. - Envestnet has approximately $6.5 trillion in platform assets and serves over one-third of all financial advisors, indicating its significant role in the wealth management industry [7].