Commonwealth sharpens HNW focus with iCapital partnership

The independent wealth firm is rolling out a custom platform for advisors to offer and conduct due diligence on alternative investments.

Commonwealth Financial Network is giving advisors in its network more support as they court more clients in the high-net-worth space.

The independent broker-dealer and RIA has entered into a partnership with fintech platform iCapital to provide its advisors with enhanced access to alternative investments.

This collaboration aims to streamline the process for advisors to offer nontraded alternative investments to high-net-worth clients.

A recent study by Cerulli Associates in January highlighted an increasing interest in alternative investments among high-net-worth investors. From 7.7 percent of client portfolios in 2020, the study found high-net-worth clientele now have an average of 9.1 percent of their assets allocated to alternative investing options, with advisors expecting this to rise to 9.6 percent by 2024.

In response, Commonwealth is scaling its alternative investment offerings, providing advisors with direct access to high-quality funds vetted by its alternative investments team.

“The iCapital partnership allows Commonwealth to supplement our existing alternative investments product platform with a suite of products designed for high-net-worth investors,” Chad LaFauci, vice president of alternative investments at Commonwealth, said in a statement.

The digitized process with iCapital simplifies what has traditionally been a cumbersome task, according to LaFauci, allowing advisors to reclaim time for other priorities while offering a more robust way to attract and retain clients.

The partnership is also a direct response to feedback from advisors seeking more effective solutions to compete for high-net-worth business. The custom platform helps lowers barriers to alternatives by curating a wide range of exclusive investment options, giving Commonwealth affiliates more room to diversify client portfolios with investments typically reserved for institutional investors.

Initially honed during a pilot program, the solution allows advisors to conduct research, perform due diligence, and facilitate subscriptions through one integrated platform.

While the current focus is on high-net-worth investors, Commonwealth aims to expand the product offerings to accommodate additional net worth levels in the future.