Active Core Portfolios Launched by Envestnet | PMC Jointly with American Funds®

Combination of Sophisticated Approach to Mutual Fund Investing with Proven Research & Portfolio Management can Help Advisors Meet Variety of Client Goals

Innovative Product Suite Enables RIAs & Broker-Dealers to Seamlessly Transition Accounts to an Advisory Platform

17 Nov, 2015, 19:58 ET from Envestnet, Inc.

CHICAGO, Nov. 17, 2015 /PRNewswire/ -- Envestnet | PMC, the Portfolio Management Consultants group of Envestnet, Inc. (NYSE: ENV), has teamed up with Capital Group's American Funds® to create the American Funds/PMC Active Core Portfolios. This new series of mutual fund portfolios is constructed by selecting active managers whose funds have both high manager ownership and low expense ratios—characteristics that have tended to outperform market indexes and the broader universe of actively managed funds[1].

In addition, the American Funds/PMC Active Core Portfolios enable RIAs and broker-dealers to seamlessly transition directly held accounts to an advisory platform.

"Our strategic relationship with American Funds is part of this ongoing effort to build and manage well-diversified, cost-effective portfolios for advisors using our select list of vetted strategists. We are proud to engage with a firm that, like us, works with many advisors to meet their clients' needs—and we are also grateful to American Funds for enabling us to facilitate a smooth process for RIA firms and broker-dealers to move their directly held accounts to an advisory platform," said James Patrick, Executive Vice President at Envestnet | PMC (PMC).

The Active Core Portfolios are underpinned by mutual funds from American Funds, which employs a fundamental research-driven approach to portfolio construction and asset allocation.  The portfolios emphasize the selection of actively managed funds that have both high manager ownership and low expense ratios. The Active Core Portfolios, built and managed by PMC, spread risk across diverse types and classes of mutual funds with these two characteristics.  The funds in each portfolio can invest in traditional equity and fixed-income securities as core exposures and can allocate to commodities and bank loans as satellites, and are managed by American Funds and other active managers that meet PMC's ongoing due diligence criteria. 

The Active Core Portfolio suite offers seven target allocations:

  • Growth
  • Conservative
  • Conservative Growth
  • Moderate
  • Moderate Growth
  • Aggressive
  • Capital Preservation

Advisors can utilize the target allocations to meet the varied investment objectives and risk tolerances of their clients. PMC charges a competitive management fee of 10 basis points for each Active Core Portfolio, and enables advisors to access the Envestnet platform's reporting tools, including informative and customized quarterly performance reports, to foster more productive and meaningful engagement with clients who invest.

"The Active Core Portfolios are an easy way for advisors to tap into our capabilities. Studies show that select active managers, including American Funds, have built a consistent, long-term record of outpacing market index returns[2]," said Bill Brady, Senior Vice President and Director of Distribution-Wealth Management. "We believe working with Envestnet | PMC will help meet the demand for packaged solutions that leverage American Funds at the core of a portfolio."

Morningstar data indicates that U.S. mutual funds with higher manager ownership and lower expense ratios outperformed the S&P 500 Index and the entire universe of actively managed funds during all rolling monthly 10-year periods between January 1995 and December 2014. International funds with these characteristics outperformed the MSCI ACWI Index (ex-U.S.) in 84 percent of the rolling monthly 10-year periods during that time frame.  

About Envestnet | PMC  Envestnet, Inc. (NYSE: ENV) is a leading provider of unified wealth management technology and services to investment advisors. Our open-architecture platforms unify and fortify the wealth management process, delivering unparalleled flexibility, accuracy, performance, and value. Envestnet solutions enable the transformation of wealth management into a transparent, independent, objective, and fully-aligned standard of care, and empower advisors to deliver better outcomes.

Envestnet | PMC provides independent advisors, broker-dealers, and institutional investors with the research, expertise, and investment solutions—from due diligence and comprehensive manager research to portfolio consulting and portfolio management—they need to help improve client outcomes.

For more information on PMC, please visit Envestnet | PMC and follow @ENVintel (https://twitter.com/envintel).

About The Capital Group The Capital Group is one of the oldest and largest funds management groups in the world, managing equity, fixed income and private equity assets for all types of investors. Since 1931, Capital Group has been singularly focused on delivering consistent results for long-term investors using high-conviction portfolios, rigorous research and individual accountability. Today, Capital Group manages more than US$1.4 trillion in long-term assets for millions of individual and institutional investors around the world.

[1] 2014 Morningstar U.S. Mutual Fund Industry Stewardship Survey March 20, 2014. http://corporate.morningstar.com/us/documents/MethodologyDocuments/ResearchPapers/MutualFundIndustryStewardship.pdf [2]American Funds 2013 report: "The Active Advantage" https://www.americanfunds.com/pdf/shareholder/mfcpbr-046_actadvbr.pdf

Media Contact:          Dana Taormina JCPR (973) 850-7305 dtaormina@jcprinc.com

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SOURCE Envestnet, Inc.



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