Coming up, managed accounts – what you need to know about key features and portfolio options, and how both advisors and clients can benefit.

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From Thrivent Asset Management, welcome to Advisor’s Market360™. A podcast for you, the driven financial advisor.

In today’s financial landscape, investment products and solutions are evolving as fast as client needs. It’s crucial for advisors to stay informed about options that could help them better serve their clients and make a difference in their practice. Managed accounts aren’t new, but they continue to advance as asset managers offer more features that benefit advisors and clients alike. Whether you’re an experienced advisor or just starting out in your practice, brushing up on your understanding of managed accounts can enhance your ability to meet your clients’ diverse needs.

There’s no better example than Thrivent’s own Managed Accounts Program. Let’s start with the basics. This program, offered by Thrivent Asset Management, delivers portfolio options that can be tailored to match your clients’ specific risk and return objectives. It’s a simple and effective approach to investing that gives you more time to build your practice while giving your clients a comprehensive level of professional portfolio management.

The Thrivent Managed Accounts Program is sometimes referred to by their underlying model portfolios. These portfolios are actively managed by Thrivent’s talented team of experts and are comprised of mutual funds. The diversified array of holdings can be geared to the specific risk and return objectives of your clients.

What other features are offered? You and your clients can expect advice, due diligence and timely information through the program, offering transparency and never leaving you in the dark.

Here’s the play-by-play. To begin, you can help your clients determine which portfolio model works best for their unique situation and financial goals. Once that decision is made, you then allocate their assets to the appropriate managed account and let the Thrivent investment team handle the day-to-day decisions in the model portfolios.

After that, you can expect ongoing monthly performance reports and quarterly commentaries, economic and market overviews, and comments regarding the performance of client portfolios along with the latest holdings. Every time a tactical trade is made, you’ll be notified with information on the rationale for that decision.

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How does working with our Managed Accounts Program benefit you as a financial advisor? Let’s talk about some key advantages.

One: managed accounts put the responsibility for investment allocations in the hands of an experienced, full-time, professional asset management team – consider us an extension of your own expertise.

Two: time and effort saved. Working with us frees you and your staff from the attention required to research the market, manage your clients’ portfolios and track their fund performance – allowing you more time to manage your practice, meet with clients and prospects, and grow your overall business.

And three: because this is a discretionary program, clients pass the decision-making authority to Envestnet, which provides a technological backbone and acts based on instructions from Thrivent Asset Management. This means that you won’t need verbal confirmation from clients to make trades, and you won’t be responsible for executing and documenting each new trade.

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Now that you understand the “whys,” let’s talk about the “hows” – starting with portfolio options. The Thrivent Managed Accounts Program offers 10 models that represent a variety of time horizons, risk tolerances, income needs, and goals – meeting the needs of most types of clients. They’re all designed with the complete lifecycle in mind – from growth of assets to retirement income.

Thrivent SELECT Managed Portfolios feature five models that focus on accumulation. They range from conservative, with lower volatility and growth potential, to aggressive, with higher volatility and growth potential.

Next, Thrivent Faith-Based Managed Portfolios feature three models also focused on accumulation that uniquely seek to integrate finances with values aligned to faith. These models range from moderately conservative to moderately aggressive, with varying levels of volatility and growth potential as well.

And finally, Thrivent Income-Focused Managed Portfolios aim to generate income for distribution with two available models: opportunistic or diversified. Both offer the lowest volatility and growth potential out of all models offered in the program.

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Next up, let’s look at some other important benefits of the Thrivent Managed Accounts Program.

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Managed accounts are long-term oriented. After setting up the long-term strategic allocations of each portfolio, the investment team monitors these accounts daily for risk management, manager performance, and potential tactical changes.

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Active management is a key feature of the program. The investment team actively trades, shifting tactical allocations when deemed necessary. Funds within each portfolio are replaced when performance has deteriorated, when investment style shifts, or when a significant change in management or process casts doubt on the fund’s ability to produce similar results in the future.

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Style purity is also important. A sophisticated selection process identifies style-pure managers and funds that the management team believes are most likely to provide risk-adjusted outperformance over a full market cycle. The team monitors the funds and their managers on an ongoing basis for style drift, ensuring that the model portfolios consistently provide market exposures that align with overall goals and objectives.

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The investment team also uses a hybrid approach to provide a diverse array of investment styles and managers. This combines both actively-managed funds and passive funds. Actively-managed products may use either a fundamental, bottom-up security selection process or a quantitative-based approach. Holding passive funds, on the other hand, is a tool that can help to maintain tactical exposure or hedge exposure to different asset classes while keeping expenses down. Another unique point is that, unlike many competitors, Thrivent Managed Accounts makes use of proprietary funds, taking advantage of cross-team synergy with in-house mutual fund managers.

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Thrivent trades with an “as-needed” approach, a fluid and responsive process compared to other firms that may operate on a schedule for conducting trades. Portfolios are monitored constantly using quantitative and qualitative tools, using the latest market and economic data to make informed decisions. As a result, tactical trades are implemented as needed to keep the model portfolios in line with target allocations.

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Flexible income distribution options give Income-Focused model clients the option to automatically reinvest dividends or request a set amount of income on a monthly, quarterly or yearly basis. If clients take the route of distributing all dividends, income will fluctuate, but it’s the most efficient distribution method because positions aren’t sold to pay income.

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Lastly, Thrivent’s Managed Portfolios Committee provides continual oversight on all the firm’s model portfolios, and ultimately is responsible for all decision-making. Formal review meetings are held once a month while portfolios remain continuously monitored for overall performance, the underlying funds’ performance, manager changes, and style purity. 

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So, why Thrivent Managed Accounts? Not only can they help to streamline your business, but they can help clients invest in a way that’s tailored to their goals.

If you’re curious about integrating managed accounts into your advisory practice or want to learn more, visit thriventmanagedaccounts.com, where you can access helpful resources, compare managed portfolios side-by-side, or reach out to a consultant.

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Thanks for listening in! We hope you found this review of Thrivent’s Managed Accounts Program valuable. More episodes of Advisor’s Market360™ are available wherever you listen to podcasts. Email us at podcast@thriventfunds.com with your feedback, questions and topic suggestions for future episodes. And as always, you can learn more about us at thriventfunds.com and find other insights of interest to you, the driven financial advisor. Bye for now.

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All information and representations herein are as of September 26, 2023, unless otherwise noted.

Actual investment decisions made by Thrivent Asset Management, LLC will not necessarily reflect the views expressed. This information should not be considered investment advice or a recommendation of any particular security, strategy or product. Investment decisions should always be made based on an investor's specific financial needs, objectives, goals, time horizon, and risk tolerance.

Thrivent Asset Management, a division of Thrivent, offers financial professionals a variety of investment products to help meet their clients’ needs.

Investing involves risk, including the loss of principal. The prospectus and summary prospectus for the securities within the model portfolios contain more complete information on the investment objectives, risks, charges, expenses and other information of the fund, which investors should read and carefully consider before investing. To obtain prospectuses, contact your Regional Investment Consultant or call 800-521-5308.

Thrivent Asset Management, LLC’s role is providing sponsors of managed accounts with non-discretionary investment advice in the form of model portfolios. The implementation of or reliance on a model portfolio is at the discretion of the managed account sponsor. Thrivent Asset Management, LLC is not providing personalized investment advice or investment recommendations and will not make any representations about the suitability of a model portfolio for any investor. Thrivent Managed Accounts information is intended for use only by third-party adviser firms in conjunction with their management of their clients’ accounts. The information about the Thrivent Managed Accounts is confidential and should not be disclosed, copied or used for any other purpose. Thrivent Asset Management, LLC does not have investment discretion over, or place trade orders for any portfolio derived from this information.

Thrivent Managed Portfolios will include Thrivent Mutual Funds. Thrivent Asset Management, LLC, herein referred to as “Thrivent Asset Management”, is a registered investment adviser, and serves as investment adviser and administrator to the Thrivent Mutual Funds and receives fees for its services as disclosed in the applicable Funds’ prospectuses and Statement of Additional Information. As the investment adviser for Thrivent Mutual Funds, Thrivent Asset Management has greater knowledge of these funds and has a tendency to prefer Thrivent Mutual Funds over non-affiliated funds, which may be a conflict of interest. Thrivent Mutual Funds included in the Faith-Based models do not incorporate an exclusionary screening process, but do not own securities that may conflict with certain values as described above. Thrivent and its subsidiaries may earn distribution and other fees, including 12b-1 fees, in connection with Thrivent Mutual Funds. For more information about potential conflicts of interest, read the Thrivent Asset Management Form ADV – Part 2 Brochure. Thrivent Mutual Funds are distributed by Thrivent Distributors, LLC, member FINRA and SIPC. Both Thrivent Asset Management and Thrivent Distributors, LLC are subsidiaries of Thrivent, the marketing name for Thrivent Financial for Lutherans.