Changing investment landscape prompts a firm to reassess asset allocations. Independent RIA American Economic Planning Group (AEPG) has outsourced some of its investment services such as back-office management and performance reporting to Adhesion Wealth Advisor Solutions in the name of internal efficiencies and to accommodate a new asset-allocation program -- and as a possible prelude to providing investment services to other advisories as a private-label offering.

"AEPG is now able to offer private-labeled investment management to other wealth managers," says AEPG executive v.p. Peter Neddham. "Through leveraging Adhesion's WealthADV platform we can offer cost effective investments and operational support to other registered investment advisors, banks and CPA firms."

Extensive review

For the most part though, AEPG partnered with wealth-management platform provider Adhesion to support its objectives to move its clients to a more transparent and flexible "core-satellite" allocation structure, provide tax-optimized investment management to big clients, build in cost efficiencies for providing investment services to small clients, and providing all clients with access to real-time reporting.

"In response to the extraordinary events of last fall, we had conducted an extensive review of our performance, methodology and even investment philosophy to look for ways to improve," says AEPG's chief investment officer Mark Ukrainskyj. "Because of this, we will be implementing several exciting improvements with benefits such as greater diversification, flexibility, lower costs and greater tax efficiency. The simultaneous introduction of Adhesion's WealthADV platform will further enhance these improvements while providing additional benefits such as better reporting."

More specifically on the investment side, AEPG is moving to what Needham calls a "dynamic core-satellite" approach featuring a more or less traditionally allocated core surrounded by market-driven, tactical plays. Tax management comes into play here as a way to manage tax hits from gains in one portion of a portfolio by harvesting losses in others.

AEPG took its search for a platform partner seriously. In the nine months before deciding on Adhesion, the Watchung, N.J.-based firm vetted about a dozen providers.

"Adhesion's focus on the independent advisor market became readily apparent; they thoroughly understood the needs of a firm like ours and as a result had the most complete set of services," says Needham.

Adhesion's president Michael Stier returns the compliment. "We see AEPG in the forefront of an accelerating trend among the more ambitious of our RIA clients looking to aggressively grow their practices," he says. "We are very pleased to partner with AEPG and gratified that with WealthADV AEPG feels confident they have the right implementation platform with which to execute their business plan."

AEPG has about $480 million in assets under management.

Charlotte, N.C.-based Adhesion has about $9 billion in assets on its platform. -FWR

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