EP Wealth Advisors, an RIA with $26 billion in AUM, is partnering with Opto Investments, an alts tech platform based in New York City, to create custom fund strategies to help EP advisors better provide private market investments options to their high-net-worth clients.
The partnership will expand private markets access for independent investment advisors by offering “institutional-type portfolios at scale,” meaning in a lower cost, simpler way, the companies said.
“While access to private markets has improved in recent years, investing in these asset classes comes with challenges, including high costs and operational and administrative complexities,” the companies said in a press release.
Opto’s platform addresses these challenges by enabling advisors to construct custom portfolios with the potential for higher returns and lower volatility, the companies said.
EP Wealth, based in Torrance, Calif., will leverage Opto’s fund offerings and technology “to create private markets vintage funds that provide access to bespoke investment strategies” for its wealthy clients, EP Wealth said.
“These customized strategies help to provide institutional-level investments at scale while aiming to eliminate unnecessary fees, minimize excess liquidity, and diversify exposure across vintages and managers,” the release said.
“When introducing private market strategies to client portfolios, a one-size-fits-all approach simply does not work,” Adam Phillips, managing director of investments at EP Wealth, said in a statement. “Opto’s fiduciary-first approach helps us build personalized portfolios that meet the unique needs of our clients, while providing access to institutional-grade investments from a vast array of managers.”
EP and Opto said they will “imminently” make available exclusively to EP clients the proprietary EP Growth fund, which Jacob Miller, Opto co-founder and chief solutions officer, told Financial Advisor is the first building block to creating a new fund of funds, potentially offering investments in such classes as private equity, venture capital and secondaries.
Opto’s deal with EP comes four months after it announced a partnership with Mercer Advisors, a $64 billion RIA in Denver, which was the firm’s biggest deal since it was created four years ago.
Miller said that his firm has relationships with “a little more than” 200 RIAs.
“Partnerships with big, respected and impressive players in the space like EP are the most important part of our growth story,” he said.
In the press release, Ryan VanGorder, chief executive officer at Opto, said his firm remains “hyper-focused on positioning advisors to confidently navigate the intricacies of private markets in a more scalable way.”
Phillips emphasized the need for education, noting that his clients see private markets as “intimidating.”
“It’s important to know what these strategies are and how and when to appropriately use them,” Phillips said. “For us the reason this deal makes sense in addition to providing support on due diligence as well as technology is Opto provides us with the tools to educate our clients.”
