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June 21, 2024
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Alternative Investments

Morningstar and iCapital’s Strategic Partnership for Alternative Investments

Morningstar and iCapital Form Strategic Partnership, Offering Advisors Access to Alternative Investments

Global fintech platform iCapital and investment insights provider Morningstar, Inc. have announced a strategic partnership for the integration of iCapital’s investment technology platform with the Morningstar Advisor Workstation. This integration will grant over 170,000 financial advisors access to alternative investments, thus enhancing their ability to provide comprehensive investment advisory services. The move marks a significant advancement for modern advisory practices, enabling advisors to evaluate private assets alongside traditional investments.

Morningstar Embraces iCapital’s Technology

The integration of iCapital’s technology into the Morningstar Advisor Workstation is a game-changer for financial advisors. Vimal Vel, Morningstar’s Chief Product Officer, emphasized the importance of this strategic partnership, which provides financial advisors with a more comprehensive understanding of investment opportunities. The integration offers access to iCapital’s Marketplace and iCapital Architect, thus providing alternative fund options, due diligence, educational resources, and portfolio construction and analysis tools.

First Phase of Integration Complete

The first phase of this strategic integration has been successfully completed, providing independent advisor clients with access to iCapital’s marketplace and architect through a user-friendly interface. The second phase, set to be introduced in the first half of 2024, will extend this integration to enterprise-level clients. It will leverage iCapital’s analytics, contributing to the generation of Morningstar’s Portfolio Risk Score.

Increasing Demand for Alternative Investments

Studies indicate a growing interest among advisors and their clients for alternative investments. Findings suggest that advisors plan to maintain or increase their allocations to alternative investments in the future, allocating between 14% and 19% of assets under management to alternatives. Lawrence Calcano, CEO of iCapital, expressed excitement over the partnership, noting the benefits it will bring to advisors in terms of access to educational resources and the user-friendly interface.

Both Morningstar and iCapital offer a diverse range of services in the investment sector, including data, research, management services, and access to private market investments. This strategic integration is set to enhance the advisory practices, meeting the growing demand for alternative investments and comprehensive investment advisory services.

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