Merrill Lynch has sweetened the deal for large wealth management clients who want access to separately managed accounts, according to news reports.

At the start of the year, the wirehouse began allowing all SMA managers on its advisory platform to extend discounted pricing for assets held at the household level, FA-IQ sister publication FundFire writes.

Merrill Lynch determines the breakpoint levels under the new pricing structure, but SMA managers still determine the fees, according to the publication.

The lowest breakpoint — based on all the assets a client’s household has with a particular SMA manager — starts at $2 million, FundFire writes. For clients who have a total of $5 million in SMA strategies with a particular manager, for example, their fees could drop from 22 basis points to 18, according to the publication.

The move was prompted by institutional and high-net-worth clients who wanted the same pricing flexibility they have on traditional dual-contract SMAs on model-based SMAs, Sandy Bolton, head of managed investments within the investment solutions group for Bank of America, Merrill Lynch’s parent company, tells FundFire.


Dual-contract SMAs come with higher minimum investments than model-delivered SMAs, according to the publication. Primarily, Merrill Lynch’s move was prompted by demand from large clients for greater flexibility in fixed-income strategy pricing, Bolton tells FundFire.

Merrill Lynch has $199 billion held in SMA assets, according to the publication.

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