An AssetMark Company - Learn More

UMAs Continue to Gain Momentum as Powerful Advice Tools

By Adhesion Wealth, An AssetMark Company


Many advisors are struggling to take on researching and identifying securities, determining optimal asset allocation, monitoring it all on a regular basis, rebalancing portfolios as demanded by clients’ ever-changing financial needs, and re-papering to suit account changes. Fortunately, there is a solution that has the potential to allow advisors to provide their clients cost-effective, personalized access to institutional asset managers while simultaneously helping their practices reach new levels of scalability and efficiency.

That solution is the unified managed account (UMA). While you may be familiar with the separately managed account (SMA) portfolio and its benefits, you might have discounted utilizing UMAs. But the next-generation of UMAs have capabilities which have the potential to take financial advice to the next level in terms of cost efficiencies and ease of delivery for both advisors and their clients.

Why Choose a UMA?

As the demand for transparency, fee compression, and after-tax returns top the list of advisor concerns regarding client portfolio solutions, the acceptance and implementation of UMAs is rapidly growing and for good reason. With the right tech provider, an open structure and intuitive user interface can allow advisors to shift between managed account programs, asset allocations, and strategist selections without administrative or operational friction.

A single-solution UMA platform gives advisors easy access to robust portfolio management and trading capabilities, with more flexibility in overlay programs. The user experience and more efficient workflow can result in enhanced services that support decision-making, order generation, and cash management, as well as the management and routing of proposed orders. Trading, re-allocating between managers, and investing new money can become more efficient, decreasing time to market.

The UMA playbook is relatively simple: 1) listen, 2) provide an easy-to-understand plan, and 3) communicate clearly. A unified, single-solution approach like this can help provide much-needed relief, off-loading the tasks of managing a complex multitude of varied account silos (often with an equally complex multitude of legacy tech systems) so advisors can spend more time on what they do best — providing holistic advisory solutions for their clients, and growing their business in the process.

Let’s Look at the Choices

The UMA is an attractive alternative to a variety of packaged managed account programs, including SMA, and mutual fund/ETF wrap products. Here’s a brief look at how they stack up:

  • Mutual Funds: Are easy to invest in and available for any sized account, but they don’t allow customization, and can be tax-inefficient.
  • SMAs: Enable customization and ownership of individual securities, and can provide access to strategies from mutual fund, ETF, and institutional managers. SMAs can enable certain tax efficiencies; however, they can create administrative burdens since each SMA is a unique client account and, as such, they each receive their own set of statements, tax documents, and rebalancing guidelines and depending on the technology and custody solutions, may not provide a holistic view of the client’s overall allocation.
  • UMAs: Provide access to multiple managers and strategies and investment vehicles in a single account and can accommodate larger account sizes. They can be tailored using more precise levels of personalization, including custom tax constraints and security-level buy and sell restrictions to accommodate legacy holdings.

Cost & Tax Efficiencies

UMA portfolios can enable tax alpha for clients through tax-loss harvesting and the sale of tax-advantageous security lots, etc. UMAs only require a single set of paperwork for all investments in the account.

Incorporating direct indexing within a UMA can offer cost advantages over traditional SMAs. By bypassing the expense of mutual funds or ETFs used in some SMAs, direct indexing allows RIAs to potentially reduce investment costs for their clients. Furthermore, by holding individual securities directly, RIAs can potentially avoid double layering of fees associated with funds used in some SMAs.

Advanced UMA available through open-architecture tech platforms can automate rebalancing and tax-loss harvesting and optimize processes with rules-based, customized parameters. These platforms typically provide wide access to asset managers—while also assuming responsibility for manager due diligence and monitoring.

For advisors looking to help clients improve investment outcomes and achieve long-term financial goals, as well as meet their own objectives for practice efficiency and growth, UMAs may be the answer to today’s demands.

C24-20981 | EXP 2/28/2026

By Adhesion Wealth, An AssetMark Company

For financial professional use only.

Important Information

This is for informational purposes only, is not a solicitation, and should not be considered investment, legal or tax advice. The information has been drawn from sources believed to be reliable, but its accuracy is not guaranteed and is subject to change.

Investing involves risk, including the possible loss of principal. Past performance does not guarantee future results. UMAs are not suitable for all investors and should be evaluated for suitability by financial professionals prior to investing.

For more complete information about the various investment solutions available, including the investment objectives, risks, and fees, please refer to the Disclosure Brochure. Please read it carefully before investing. For a copy, please contact Adhesion Wealth Advisor Solutions (“Adhesion Wealth”).

Adhesion Wealth is an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). Adhesion Wealth and third-party providers are separate and unaffiliated companies. Each party is responsible for their own content and services.

Adhesion Wealth is an affiliate of AssetMark, Inc., an investment adviser registered with the SEC.

©2024 Adhesion Wealth Advisor Solutions. All rights reserved. © 2024 Adhesion Wealth Advisor Solutions, Inc. All rights reserved.

C24-20942 | 02/2024 | EXP 2-28-2026