In the latest example of the wealth management industry adjusting to the growing demand for sustainable investing products and strategies, J.P. Morgan on Tuesday announced the acquisition of OpenInvest, a technology platform that helps financial professionals customize and report on values-based investments.
J.P. Morgan Asset & Wealth Management, which has more than $2.4 trillion in ESG-integrated assets under management, plans to make the OpenInvest technology available to its private banking and wealth management units.
“Clients are increasingly focused on understanding the environmental, social and governance impact of their portfolios and using that information to make investment decisions that better align with their goals,” Mary Callahan Erdoes, chief executive of J.P. Morgan Asset & Wealth Management, said in a statement.
While the performance of ESG strategies in general has lagged that of the broader stock market indexes in 2021, the categories gained a significant boost last year, when funds that excluded some fossil fuel-related companies enjoyed high-profile triple-digit returns.
According to Refinitiv Lipper, green-energy ETFs have already taken in $6.2 billion this year, which compares to a record $7.2 billion for all of 2020.
“Investor interest in ESG has been growing and large financial institutions have focused on providing strategies and services,” said Todd Rosenbluth, director of mutual fund and ETF research at CFRA.
Founded in 2015, OpenInvest was originally designed for retail investors but eventually expanded to serve the financial planning community that was populating the inbound inquiries, said Joshua Levin, OpenInvest co-founder and chief strategy officer.
In addition to overlay technology for values-based portfolio analysis, the acquisition of OpenInvest also provides investors with direct proxy-voting access.
OpenInvest, which will continue to operate as a brand inside of J.P. Morgan Wealth Management, also was building custom separately managed accounts for individuals and institutional clients. Levin refused to disclose how much the robo platform was managing but said once the business is part of J.P. Morgan, all other institutional relationships will “sunset or be transferred to J.P. Morgan.”
According to J.P. Morgan’s announcement, the OpenInvest platform is expected to eventually be paired with the recently acquired tax management fintech platform 55ip.
Voya Financial adds private equity, credit and real estate options to its AMA program, building on support for looser federal investment rules in retirement accounts.
Shannon Reid, president of Osaic and the network’s number two executive, has plenty of challenges, industry executives said.
Auditors flagged the commingling. The COO allegedly knew. Investors kept getting the pitch
The advisors on the move include two brothers leading a family practice in Connecticut, and a husband-and-wife tandem working with business owners in the West Coast.
Business owners and their heirs may be making assumptions instead of having conversations, creating challenges for succession planning, according to new research.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
