Advisors who outsource portfolio construction to model portfolios are spending only a small slice of their time on investment management, and many are using the freed-up hours to move upmarket. Cerulli finds that these advisors tend to be younger, less experienced and run leaner teams, and they were trained by broker dealer programs that taught the benefits of models. Instead of building portfolios client by client, they lean on planning, tax management and other services that appeal to affluent and high net worth households. Support from model providers matters too, with advisors valuing competitive product information, peer best practices and access to portfolio managers. The message for providers is clear: keep advisors informed about product nuances and the thinking behind the allocation, since advisors must explain it to clients. Models are no longer just a convenience. They are becoming a growth strategy that lets advisors spend more time winning and serving clients.

Finsum: Delegating the is a choice to spend scarce time where clients feel the value most, in planning, tax work and the relationships that build bigger practices.