Schwab Expands Managed Account Services
October 05 2005 - 8:45AM
PR Newswire (US)
Pricing up to 50% Below Published Rates of Competitors SAN
FRANCISCO, Oct. 5 /PRNewswire-FirstCall/ -- Charles Schwab &
Co., Inc. today significantly expanded the availability of
third-party and proprietary managed accounts to all its retail
brokerage clients nationally. Previously, Schwab's managed account
offering was available only through the fee-based services of
Schwab Private Client(TM) or one of the independent investment
advisory firms doing business through Schwab Institutional. Now,
all qualified retail clients will be able to put the power of
managed accounts to work for their portfolio with guidance and
assistance from Schwab's financial consultants. Managed accounts
(also known as "separate accounts" or "separately managed
accounts") are fee-based portfolios of individual securities
selected and managed on a discretionary basis by professional money
managers. These money managers typically specialize in specific
investment styles, such as large-cap growth, international equity
or short-term fixed income. Managed accounts have other important
features such as potential tax management benefits through greater
control of capital gains and losses, and the ability to place
restrictions on specific securities or categories of securities
held in the account.(1) Growing in popularity, managed accounts are
expected to exceed $1 trillion in assets by 2008.(2) "The expansion
of our managed account services is in direct response to client
need. More investors are demanding these sophisticated money
management solutions, but don't want to pay the high fees typical
of full-commission brokerages where these accounts are primarily
sold," said Executive Vice President William Atwell, President of
Schwab's Individual Investor Enterprise. "Our managed account
services represent the exact combination of value and service that
investors have come to expect from Schwab. This continues our
heritage of giving Main Street investors affordable access to the
investing opportunities previously only available from Wall Street
at high prices. Our managed account pricing is as much as 50
percent below the published rates of major competitors." Account
minimums for managed accounts at Schwab are $100,000 for most
equity strategies and $250,000 for most fixed income strategies.
Schwab's offering for retail investors consists of: Managed Account
Select(R) -- A comprehensive selection of approximately 40 third
party money managers, coupled with unaffiliated research and review
of the money managers by Callan Associates, Inc., one of the
nation's leading investment consulting firms, with over 30 years of
expertise in researching and screening money management firms.
Managed Account Affiliates(R) -- Four strategies from Charles
Schwab Investment Management, Inc. utilizing Schwab Equity
Ratings(R) for stock selection, and five strategies from the money
managers at U.S. Trust. Enhanced Managed Account Offering for
Independent Advisors In addition to Managed Account Select and
Managed Account Affiliates, independent advisors who custody with
Schwab Institutional have exclusive access to recently launched
Managed Account Access(R), a bundled service offering advisors
access to a broad array of top money managers with minimums as low
as $100,000. Managed Account Access provides advisors with the
streamlined administration available at brokerage competitors along
with the flexibility to do their own due diligence. Advisors also
have exclusive access to the Managed Account Marketplace(R), which
gives advisors the freedom to work with more than 700 money
managers, negotiating their own fees and performing their own due
diligence. "Advisors and their clients truly appreciate the choice
and flexibility in our offering," said John Morris, senior vice
president, Schwab Managed Accounts, noting that Schwab has one of
the industry's largest managed account programs for independent
advisors. Across the firm, client assets in managed accounts at
Schwab totaled $24 billion as of August 31, a 39% increase over the
same time a year ago. About 80% of the total is attributable to
independent advisors. Schwab launched its managed account offering
for advisors in 1998 and first expanded availability to retail
investors, through Schwab Private Client, in 2001. About Charles
Schwab The Charles Schwab Corporation (NYSE / Nasdaq: SCH), through
its operating subsidiaries, provides securities brokerage and
financial services to individual investors and the independent
investment advisors who work with them. With over 7 million
individual investor accounts and more than $1.1 trillion in client
assets, The Charles Schwab Corporation is one of the nation's
largest financial services firms. Its subsidiary Charles Schwab
& Co., Inc. (member SIPC) provides a complete range of
investment services and products, including an extensive selection
of mutual funds; financial planning and investment advice;
retirement plans; referrals to independent fee-based investment
advisors; and custodial, operational and trading support for
independent fee-based investment advisors. Its subsidiary Charles
Schwab Bank, N.A. (member FDIC) provides banking products and
services. The Corporation's other operating subsidiaries include
U.S. Trust Corporation (member FDIC) and CyberTrader(R), Inc.
(member SIPC) .These companies' Web sites can be reached at
http://www.schwab.com/, http://www.schwabbank.com/,
http://www.ustrust.com/, and http://www.cybertrader.com/.
(1005-9496) Investments in managed accounts should be considered in
view of a larger, more diversified investment portfolio. Please
read Schwab's schedule H of form ADV for important information and
disclosures relating to Schwab Managed Account Services. (1)
Services may vary depending on the money manager chosen, and are
subject to money manager acceptance of the account. (2) Cerulli
Associates, November 2004 DATASOURCE: Charles Schwab CONTACT: Glen
Mathison, +1-415-636-5448, or , or Sarah Bulgatz, +1-415-636-5940,
or , both of Charles Schwab Web site: http://www.schwab.com/
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