Fidelity Model Portfolios Now Available Through 55ip
Collaboration combines Fidelity’s portfolio management capabilities with 55ip’s tax-smart technology
BOSTON–(BUSINESS WIRE)–55ip today announced that advisors now have access to Fidelity InstitutionalSM’s professionally managed model portfolios, combined with 55ip’s ActiveTax Technology®, to help advisors add scale and efficiency to their practices. In addition, 55ip’s existing integration with Fidelity’s custodial platform has been enhanced to make the experience even easier for advisors.
Through the power of tax-smart transitions, advisors will be positioned to make the move to Fidelity models more easily by simplifying the processes around capital gains tax. In addition, advisors will be able to help drive better outcomes through tax-smart management — leveraging systematic, ongoing tax-loss harvesting — and guide clients through tax-smart withdrawals. The turnkey delivery of Fidelity models adds efficiency for advisors, and the offering can also help save advisors time through automated trading and rebalancing, a critical benefit for both taxable and qualified accounts.
“Transitioning taxable assets to new portfolios, managing taxable accounts and leveraging model implementation in general can be a heavy lift for advisors,” said Paul Gamble, CEO of 55ip. “Our relationship with Fidelity brings together our automated tax technology with Fidelity’s investment experience, diversified lineup and decades of portfolio management experience. We’re also excited about our enhanced custodial integration, which will save advisors steps in the process, enabling them to more easily leverage tax-smart models and clearly demonstrate their value to clients.”
“Model portfolios help advisors efficiently manage their clients’ assets and address a broad range of investment needs, and our work with 55ip adds to that efficiency by layering on tax-smart technology to the turnkey delivery of our models,” said Matt Goulet, senior vice president for portfolio solutions at Fidelity Institutional. “This collaboration also delivers more flexibility to advisors by expanding where they can access Fidelity’s model portfolios.”
55ip and Fidelity also launched new, deep integrations to streamline and simplify the advisor experience, including single-sign-on (SSO) from 55ip to Fidelity’s WealthscapeSM platform; automated account integration, eliminating the need for manual uploads; and enhanced processing for trade list execution. These upgrades will help to create a more seamless experience for advisors who custody with Fidelity, whether they are using Fidelity models or any of the other models available through 55ip, including advisor-designed models and those from BlackRock, J.P. Morgan, WisdomTree and RiverFront Investment Group.
Through its relationships, 55ip helps advisors minimize taxes, save time in model implementation for both taxable and qualified accounts, and grow their practices. In 2020, advisors using 55ip’s tax-smart technology generated 2.58%1 average tax savings through ongoing, systematic tax-loss harvesting. Historically, model adoption has been dominated by smaller retirement accounts, largely due to the pain of capital gains taxes when transitioning taxable accounts. The average account size for advisors using models is $100,000. For advisors using 55ip, the average taxable account size is roughly six times that amount.2
1 The underlying product fees cited do not include any fees paid to 55ip or the clients’ advisors on the referenced portfolios. Includes all 55ip-powered portfolios incepted by 12/31/19. Estimated tax savings are the difference between the average estimated tax bill across portfolios without active tax management that were fully invested in their model at inception and the estimated tax bill with active tax management stated as a percentage of portfolio value. Tax rates: Short-term capital gains are taxed as ordinary income; data shown incorporates the highest federal tax rate of 37% unless specific federal tax rates were supplied by advisors for individual accounts. Long-term capital gains are taxed at the highest federal tax rate of 20% unless specific federal tax rates were supplied by advisors for individual accounts. An additional 3.8% net investment tax is applied to both short-term and long-term tax rate calculations. Tax rates are subject to change over time. It is assumed that the investor has, or will have, sufficient capital gains from sources outside of this portfolio to fully offset any net capital losses realized, and any resulting tax benefit has been included in this calculation of after-tax performance.
2 Average account balance in models with 55ip as of June 30, 2020.
About 55ip
55ip is a financial technology company whose purpose is to break down barriers to financial progress. Financial advisors use 55ip’s tax-smart investment strategy engine to dramatically improve their efficiency and effectiveness. 55ip’s intuitive experience and intelligent automation elevate portfolio design and delivery, helping advisors save time and drive better outcomes for their clients. At the heart of the experience is 55ip’s ActiveTax Technology®, which includes tax-smart transitions, management and withdrawals.
55ip is the marketing name used by 55 Institutional Partners, LLC, an investment technology developer, and for investment advisory services provided by 55I, LLC, an SEC-registered investment adviser. 55ip is a wholly owned subsidiary of J.P. Morgan Asset Management, the asset management business of JPMorgan Chase & Co.
For more information on 55ip, please visit www.55-ip.com.
About Fidelity Investments
Fidelity’s mission is to inspire better futures and deliver better outcomes for the customers and businesses we serve. With assets under administration of $10.3 trillion, including discretionary assets of $3.9 trillion as of March 31, 2021, we focus on meeting the unique needs of a diverse set of customers: helping more than 35 million people invest their own life savings, 22,000 businesses manage employee benefit programs, as well as providing more than 13,500 institutions with investment and technology solutions to invest their own clients’ money. Privately held for 75 years, Fidelity employs more than 47,000 associates who are focused on the long-term success of our customers. For more information about Fidelity Investments, visit https://www.fidelity.com/about-fidelity/our-company.
Fidelity Model Portfolios, which include any custom models, are made available to financial intermediaries on a non-discretionary basis by Fidelity Institutional Wealth Adviser LLC (“FIWA”), a registered investment adviser, or by Fidelity Distributors Company LLC (“FDC”), a registered broker-dealer (collectively “Fidelity”).
“Fidelity Investments” and/or “Fidelity” refers collectively to FMR LLC, a U.S. company, and its subsidiaries, including but not limited to Fidelity Management & Research Company LLC (FMR) and FIWA.
Fidelity InstitutionalSM (FI) provides investment products through Fidelity Distributors Company LLC; clearing, custody, or other brokerage services through National Financial Services LLC or Fidelity Brokerage Services LLC, Members NYSE, SIPC; and institutional advisory services through Fidelity Institutional Wealth Adviser LLC.
Fidelity Investments® is an independent company, unaffiliated with 55ip. Fidelity Investments is a registered service mark of FMR LLC. 969105.1.0
Contacts
Marissa Comerford
Gregory FCA for 55ip
[email protected]
610-228-2104
