Separately Managed Accounts
What is an SMA?
Separately managed accounts (SMAs) enable investors to directly own securities while still enjoying the benefits of a professionally managed investment strategy.
- In an SMA, investors directly hold securities, like stocks or bonds, in their own account.
- In a comingled fund, like a mutual fund or an exchange-traded fund (ETF), investors purchase or sell shares of a fund that invests in underlying securities. Generally, a commingled fund has many investors.
- Both SMAs and commingled funds enable investors to employ professional investment management experience in their portfolios. However, since an SMA is managed exclusively for an individual investor, it can be personalized to their situation and needs.
Our independent SMA managers bring 40 years of experience as a global leader in systematic investing to personalized investment solutions. These SMA solutions are designed to go beyond index-based investing to help investors purse higher expected returns while applying flexible, tax-aware implementation. Our investment approach is based on decades of empirical research and experience managing strategies in competitive markets.
Why Customize Your Portfolio?
With customization, you can align your portfolio with your unique investment objectives, preferences, and values.
- For tax sensitive investors, we can enable a broad and multi-faceted approach to tax management—beginning with a tailored tax transition experience and supplemented with other tools, including ongoing tax loss harvesting and charitable giving opportunity analysis.
- With personalization tools, you can integrate your values into their investment strategies by choosing from dozens of intuitive ESG-related screens that exclude companies based on issues related to sustainability, human rights and diversity, faith-based values, and much more. You can also exclude or restrict trading of specific companies and may be able to select from three proxy voting approaches.
- For investors with unique employment considerations, SMAs enable advisors to consider existing employer stock exposures or trading restrictions. You can also tailor investment exposure to your industry of employment, enabling more wholistic management of your financial and human capital.
Personalizing Your SMA
With many avenues for personalization, we can consider your current personal circumstances and goals and adjust as your circumstances evolve. SMAs can be customized to your tax circumstances, ESG values, and employment-related criteria.
Can My ESG Values Coexist With My Investment Goals?
Our approach still starts with having a broadly diversified, systematic investment strategy that emphasizes securities with higher expected returns, as indicated by research, while also aiming to minimize unnecessary turnover and trading costs, and then using funds that systematically integrate sustainability goals:
Target higher expected returns
Rather than designing a portfolio around a commercial index, we can consider strategies that target the long-term drivers of stock returns—small cap, value, and high-profitability stocks.
Integrate multifaceted tax management
SMAs can apply a broad range of tax management considerations to help investors improve after-tax returns.
Diversify concentrated legacy portfolios
Robust analytics quantify the tax costs and investment benefits of moving toward a diversified, personalized strategy.
Investors can tailor their account holdings to avoid concentration in a particular stock or sector based on company employment, board membership, ESG considerations, or other factors.
Apply ESG considerations
Our SMA solutions provide an intuitive, transparent set of ESG screens to enable values-based investment decisions.
Meet charitable giving goals
Our process identifies highly appreciated stocks and provides options for pursuing gifting and tax management goals while maintaining portfolio balance.
Customized Levels of Tax Management
Tax management customizations are multi-faceted and can be tailored across a range of tax circumstances: from approaches designed for tax-exempt investors or accounts to approaches for highly tax sensitive accounts.
- Tax sensitive investing in our SMAs spans from initial, tax-aware strategy design, to tailored tax transition analysis, and across a range of customizable, ongoing tax management approaches.
- Clients can select from four approaches to ongoing tax management, including options designed for tax-exempt investors and accounts and investors with varying ranges of tax sensitivity.
- For more tax sensitive investors, the standard and aggressive approaches to tax management apply increasing levels of emphasis on tax loss harvesting and maximizing post-tax returns.
SMA Experience - Beyond Indexing
Start with a systematic strategy built on 40 years of expertise adding value over indexed approaches. Our SMAs target higher expected returns in a flexible, diversified, low-cost manner.
- Systematic, value-add investment approach pursuing higher expected returns
- Flexible, daily process to balance premiums, costs, and risks
- Multifaceted approach to tax management
- Ability to complement SMA strategies with client's other assets.
- Competitive costs and minimums.
Fees and Strategy Minimums
- $500,000 Strategy Minimum
- 0.18% - 0.35% Annual SMA Manager Fee
ESG Personalization Options
- Curated approach to integrating ESG screening and proxy voting
- Ability to exclude or restrict individual securities and sectors
- Flexibility to address client’s human capital considerations and current holdings
Beacon Hill Private Wealth is an independent, fee-only, fiduciary investment advisor providing evidence-based wealth planning solutions that simplify our clients' financial lives. Founder Tom Geoghegan, CFP®, CIMA®, CPWA®, RMA® is also a member of the National Association of Personal Financial Advisors (NAPFA).
The Certified Private Wealth Advisor® (CPWA) certification, administered by the Investments & Wealth Institute®, is the standard for competence in the field of wealth management today. The advanced credential created specifically for wealth managers working with high-net-worth clients is focused on the life cycle of wealth—accumulation, preservation, and distribution. CPWA certified professionals are able to identify and analyze the unique challenges high-net-worth individuals face and understand how to develop specific strategies to minimize taxes, monetize and protect assets, maximize growth, and transfer wealth. The CPWA designation signifies that an individual has met initial and on-going experience, ethical, education, and examination requirements for the professional designation, which is centered on private wealth management topics and strategies.