The next level of customization in Separately Managed Accounts
What is Personalized Managed Accounts (PMA)?
Every investor’s needs and preferences are unique. And as wealth grows, so do expectations and complexity—like tax management and environmental, social and governance (ESG) considerations. Yet the level of personalization and customization required to meet each client’s distinct goals can quickly send a practice into disarray.
That’s where Personalized Managed Accounts comes in. PMA is a distinctive solution tailored to investors’ unique and specific needs, featuring:
- Separately managed accounts
- Custom overlay services (e.g., tax management and ESG considerations)
- Personalized transition management
The benefits of PMA
PMA gives you and your clients access to an investing approach that leverages Russell Investments’ extensive investment manager research, selection and monitoring process. This process is our trademark, forming the cornerstone of our advice to global institutional investors for more than 50 years.
But it doesn’t stop there. Now, through PMA, investors have access to the next level of a customized separate account solution that is built entirely around their unique needs. PMA lets you personalize the portfolio at the individual account and securities levels.
Take control and personalize your separately managed accounts with PMA.
PMA empowers you to:
Access a robust toolkit of tax-managed overlay services designed to maximize after-tax wealth
Choose among a variety of environmental, social and governance (ESG) exclusion and overlay options
Develop an optimal transition plan of current assets customized to your tax circumstances and preferences
Diversify a concentrated stock position
Select or exclude individual securities based on personal preferences, objectives or constraints
Pair with other asset class portfolios to create a total portfolio that meets your risk objective
Achieve all of this while leveraging the Russell Investments partnership to implement Personalized Managed Accounts seamlessly and with little effort on your part.
Use our investor-friendly brochure to help explain the benefits of Personalized Managed Accounts to your clients.
Read our blog post for a quick refresher on the pros and cons of separately managed accounts (SMAs), plus a potential solution for today’s investors: Personalized Managed Accounts.
Explore the SMAs at the foundation of Personalized Managed Accounts
Depending on your goals and preferences, select one or a combination of our Separately Managed Accounts to form the foundation for your personalized portfolio. Then customize your portfolio with the features that best reflect your goals, circumstances and preferences.
DIRECT-INDEXED (DI) SMAs:
Designed to achieve index-like market exposure through direct stock holdings.
CORE EQUITY SMAs:
Combine multiple strategies in a single account
Personalized DI Core Equity SMA
The percentages represent the target allocation as of 6/1/2022 and may change in the future.
PMA gives you flexibility and choice
Add custom overlay and exclusion services: These can be added to your Personalized Separately Managed Accounts to provide a truly active approach offering flexibility and a higher level of customization.
Steer your portfolio in the right direction.
Build around your needs.
Custom-design your portfolio:
You have beliefs, either faith-based or ESG preferences, that may lean you toward or away from specific types of companies. With Personalized Managed Accounts, you can restrict purchases to those stocks, industries and categories in your customized portfolio.
You own restricted stock or equity options. Personalized Managed Accounts allows you to limit additional ownership in the company or industry.
You have a concentrated stock position with a low-cost basis and want to avoid triggering significant capital gains if you sold it. With Personalized Managed Accounts you can build around this position or transition out of it over time while minimizing the tax.
Here’s how we can help you maximize your after-tax wealth.
Tax-managed overlay services provide:
Year-around tax management
- Tax-loss harvesting
- Wash sale minimization
- Tax smart turnover
- Holding period
- Investment professionals focused on maximizing your after-tax outcome
Transition accounts easily and efficiently
Our transition management is customized to your client's personal preferences and makes it easy for you to transition your client's current assets to PMA in a tax-efficient manner. Through our custom transition analysis report, we can develop an optimal transition plan customized to each of your clients’ tax preferences and circumstances.
Our Consultative Review process entails:
Additional related materials
Since 1985, with the launch of our Tax-Exempt Bond Fund, Russell Investments' goal has been to help investors maximize their after-tax wealth. Explore our Tax-Managed Model Strategies as well as our Tax-Managed & Tax-Exempt Funds.
* Managers listed above are current as of 8/8/2023. Russell Investment Management, LLC (“RIM”) selects the money managers and optimizes the portfolio utilizing quantitative and/or rules-based processes. RIM’s portfolio construction process seeks to achieve the desired level of concentration, appropriate risk management, and exposure to strategic and tactical sources of excess return intended to meet the separately managed accounts investment objective over a market cycle. These money managers are unaffiliated with RIM and have non-discretionary asset management assignments pursuant to which they provide a model portfolio to RIM representing their investment recommendations. RIM may change portfolio asset allocation at any time, including not allocating portfolio assets to one or more money manager strategies.
Frequently Asked Questions for Personalized Managed Accounts (PMA)
Separately Managed Account (SMA)
What is a Separately Managed Account (SMA)?
What are the benefits of using SMAs for investors?
How do SMAs differ from mutual funds or ETFs?
What are some reasons why investors choose SMAs over other investment options?
How can SMAs help investors minimize their tax liability?
Give an example of how SMAs can be used to meet an investor’s customization requirements.
How can SMAs help investors diversify a concentrated stock position?
What are the drawbacks of managing SMAs without the right tools?
How can partnering with a firm like Russell Investments help financial advisors implement SMAs more effectively?
What investment challenges can Direct Indexing help solve?
How does Direct Indexing in Separately Managed Accounts differ from commingled product options like mutual funds and ETFS in terms of tax efficiency?
How does Direct Indexing differ from mutual funds and ETFs in terms of personalization?
How can Direct Indexing help mitigate the tax impact of reducing a concentrated stock position?
What are some challenges investors face reducing a concentrated stock position?
What benefits does Direct Indexing provide in managing tax implications for future taxable events?
Why is it beneficial to plan for future financial windfalls by using Direct Indexing SMAs and generating tax losses over time?
How can a transition analysis help investors when repositioning their portfolios?
What are the two approaches to transitioning a portfolio in a tax-efficient manner?
How can a transition analysis assist investors in making decisions about their portfolio transition?
What is the purpose of assessing tracking error when repositioning a portfolio?
How can a tax-managed transition help investors with concentrated or unmanaged portfolios?
What role can financial professionals play in guiding investors through portfolio transitions?
Customization, Values- and Faith-Based Investing, and Charitable Giving
What are some customization options that investors may seek when it comes to their investment portfolios?
What advantage does the Personalized Managed Accounts program offer in terms of customization?
The program empowers investors to add investment exclusions in the following way:
|CUSTOM RESTRICTIONS||ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG)-BASED RESTRICTIONS|
|You provide a list of securities to exclude based on your requirements.
How can offering a portfolio aligned with clients' values differentiate financial advisors?
How does the PMA program support charitable giving?
How can Personalized Managed Accounts (PMA) enhance customization and tax management?
How does the Personalized Managed Accounts (PMA) program work?
Depending on an investor’s goals and preferences, one, or a combination of our SMAs offered through the PMA program will form the foundation of the investor’s personalized portfolio. Then select one or multiple features to customize the portfolio to best reflect unique needs or select from a list of pre-defined exclusions.
What types of separately managed accounts are offered through the PMA program?
What are the advantages of the PMA program?
- Maximizing after-tax wealth
- Aligning values-based preferences with investments
- Diversifying a concentrated stock position
- Limiting purchases in stocks or industries already owned
- Developing an optimal tax-efficient transition plan
How to choose the best investment strategy under the PMA program?
Why choose Russell Investments for Personalized Managed Accounts?
Our PMA program leverages the best that Russell Investments has to offer. It features a dedicated team of portfolio managers, quantitative research analysts and service teams, centralized trading and implementation, as well as automated year-round tax management capabilities, including tax-loss harvesting, wash-sale minimization, tax-smart turnover and holding-period management. Ultimately, these customized SMAs will help clients meet their desired outcomes by minimizing the impact of taxes and transaction costs while maintaining tracking error to a target portfolio. We leverage technology to help investors achieve growth and optimal after-tax outcomes.