‘Make sure clients know what they own and why’

investmentnews.com:

As registered investment advisors face an increasingly complex landscape marked by rapid technological advancements, changing client demographics, market uncertainty, and emerging investment opportunities, the path to sustainable growth and competitive differentiation has become more challenging than ever.

In a recent webinar, several Goldman Sachs executives, along with Cameron Dawson, CIO of NewEdge Wealth, an RIA, gave advisors insight into the types of investment opportunities RIAs can use to help build their book of business and ultimately their clients’ wealth.

When it comes to building out alternative strategies within portfolios, Dawson said investors have to be highly selective, which “necessitates us as a firm to have a robust due diligence team in order to filter through all of the imbalance of funds that are wanting to get on our platform and be highly selective about the ones that we bring on.”

NewEdge Wealth, for example, met with over 150 private credit funds and chose just four. That kind of selectivity is imperative, Dawson added, mostly in times where capital rushes into certain pockets of the market, like private credit.

“The way you’re invested has to be far more focused and far more selective. The most important part in all of this is making sure that clients know what they own and why they own it,” she said.

This discussion also dived into ETFs and the substantial growth that those funds have seen. ETFs have gone from approximately $200 billion in the early 2000s to nearly $10 trillion currently, including hybrid models, noted Gregory Calnon, co-head of public investing at Goldman Sachs Asset Management.

“ETFs are an incredibly helpful and powerful tool in building out client portfolios to be able