Morningstar and iCapital Announce Strategic Relationship to Expand Financial Advisor Access to Alternative Investments and Insights

Morningstar, Inc. (NASDAQ: MORN) and iCapital have formed a strategic alliance to introduce alternative investments and analytics to users of Advisor WorkstationSM, marking the first time such access is provided. Through this integration, over 170,000 users of Advisor Workstation will gain access to alternative investment research and tools, enabling the evaluation of private assets alongside traditional investments. The comprehensive solution, combined with the existing investment proposal and report capabilities in Advisor Workstation, empowers financial advisors to deliver well-rounded recommendations and construct diversified portfolios that incorporate alternative assets for their clients.

The initial phase of the strategic partnership has concluded, offering independent advisor clients seamless access, via a unified interface, to iCapitalMarketplace—a platform featuring an extensive array of alternative investment funds, due diligence, educational resources, fund subscription processing, and third-party reporting services. Additionally, users can leverage iCapital Architect, an innovative portfolio construction and analysis tool enabling financial advisors to construct personalized and robust client portfolios that incorporate alternative investments.

The upcoming second phase, anticipated in the first half of 2024, will extend the integration to Advisor Workstation's Enterprise-level clients. This phase will utilize iCapital's analytics to generate Morningstar's Portfolio Risk Score, a numerical representation of the risk level of a specific portfolio against the Morningstar Target Allocation Index Family, especially when alternative investments are introduced to client asset allocations. Integrating this information with the Morningstar Risk Profiler's risk tolerance test, Advisor Workstation will display the range of Portfolio Risk Scores, referred to as the Risk Comfort range, within which each client is most comfortable.

Source: Morningstar