BlackRock has created a new unit called Client Portfolio Solutions (CPS), to focus on custom portfolio construction and asset allocation.
According to a memo sent to employees by Larry Fink, BlackRock chief executive, and Rob Kapito, BlackRock president, the new unit will aim to be the go-to point of contact for portfolio construction and asset allocation needs of the firm’s wealth management and institutional clients.
‘It will be a new investment pillar for the firm alongside global fixed income, active equities, multi-asset strategies, BlackRock alternative investors, ETF and index investments and trading and liquidity strategies,’ Fink and Kapito wrote in the memo.
CPS is led by Ryan Marshall and focuses on building and running custom portfolios, which includes outsourced-chief investment officer mandates and model portfolios as well as portfolio construction and asset allocation assignments.
Marshall, previously global head of BlackRock’s client solutions group, reports to Rich Kushel, head of multi-asset strategies and global fixed income, and Mark McCombe, head of the Americas. Previously, Marshall reported to Philipp Hildebrand, head of the BlackRock Investment Institute.
Kushel recently took on the additional role as global head of the firm's $1.8 trillion fixed income unit, after it was announced Tim Webb was to leave the firm after 18 years.
The new group consist of over 100 people and is to work with a new portfolio research group from the BlackRock Investment Institute, led by Hildebrand. The portfolio research group is to use market assumptions to direct portfolio construction and asset allocation.
‘As demand grows at double-digit rates industry-wide for portfolio construction and asset allocation services and solutions, no firm is better positioned to respond than BlackRock,’ the memo said.
CPS is to also work with the existing third-party manager research group which is overseen by Marshall. According to the memo, the manager research group is to double its coverage over the next two years and is to incorporate a more ‘data and analysis,’ driven approach.
Additionally, BlackRock is to create a team to focus on the challenges which its strategic partnership program clients face.
‘With these steps and the support of everyone at the firm, BlackRock will be the undisputed leader in portfolio construction and asset allocation – and truly deliver on our longstanding commitment to help our clients build better financial futures by building better portfolios,’ the memo said.