BlackRock has made a minority investment in SpiderRock Advisors in connection with the establishment of a strategic venture to boost separately managed account (SMA) strategies.
Financial terms of the deal were not revealed.
As part of the deal, BlackRock will collaborate with SpiderRock Advisors to expand access for wealth firms and financial advisors to professionally managed, options-based SMA strategies.
SpiderRock Advisors provides customised options strategies in the US wealth market.
The firm’s strategies are said to be focused on risk management and yield enhancement for diversified portfolios and concentrated stock positions.
BlackRock’s market leaders and consultants in US Wealth Advisory will become primary distribution and marketing team in launching SpiderRock Advisors’ advisory services and strategies.
The access to SpiderRock Advisors’capabilities will provide more tools for financial advisors and wealth firms to deliver tax-efficient, personalised portfolios and risk management solutions.
BlackRock’s SMA franchise offers customised actively managed fixed income, equity, and multi-asset strategies.
The firm further bolstered the franchise with the recent acquisition of personalised index provider Aperio. It manages over $190bn in SMAs as of 31 March 2021.
BlackRock head of US Wealth Advisory business Martin Small said: “BlackRock continues to invest to equip wealth managers with innovative solutions that support the twin objectives of better after-tax performance and personalisation.
“We are eager to help advisers access SpiderRock Advisors’ capabilities to help them build tax -efficient, highly customisable portfolios that can generate income and manage risk for their clients.”
The US retail and wealth SMA market is said to total around $2.1 trillion in assets. It is growing at a rate of approximately 15% annually and 35% among RIAs.
SpiderRock Advisors president and CIO Eric Metz said: “With BlackRock’s breadth of industry relationships, SpiderRock Advisors will be able to partner with more advisors to deliver tailored portfolios and help investors achieve their investment goals.”
Last month, BlackRock expanded its existing partnership with financial technology platform iCapital Network to enhance its access to private market investments for wealth managers.