Principal^® launches enhancement to fintech-enabled model portfolios, offering industry-first customized direct indexing in fixed income

Principal Asset Management^SM today announced it is enhancing its fintech-enabled model portfolio solution by incorporating individual bonds as an option for model portfolios. Principal^® collaborated with YieldX and Smartleaf Asset Management^® (SAM) to offer the only full portfolio direct indexing solution, enabling financial advisors to expand the capabilities of direct indexing beyond equities to individual bonds. 

“We’re taking the next step in our evolution to deliver model portfolios that are simple to adopt, easy to manage, and offer advisors a scalable, but differentiated, investment solution that can be personalized for their clients,” said Jill Brown, managing director, U.S. Wealth Platform, Principal Asset Management. “We are the first asset manager to work with YieldX to incorporate individual bonds into model portfolios, making the combinations of mutual funds, ETFs, individual equities, and now individual bonds available through our 37 model portfolios even more powerful.”

Principal launched fintech-enabled model portfolios last year in collaboration with SAM to make it easy to construct and manage custom portfolios. 

“Through the addition of capabilities from YieldX, advisors will now have the option to include individual fixed income securities, similar to how direct indexing has delivered custom individual equities to clients,” said Adam Green, CEO, YieldX. “Our technology simplifies access to individual bonds and can optimize the fixed income portion of a client's portfolio for better, more personalized outcomes.” 

Last year, Principal also partnered with Jacobi Inc., a global investment technology provider, to create proprietary multi-asset risk analytics. These analytics make it easier for an advisor to understand how the model portfolios will behave in different market conditions. Through this enhancement, advisors have access to bespoke, forward-looking, and historical analytics.

Partnering with companies like Jacobi, YieldX, and Smartleaf Asset Management gives advisors access to curated technology that works together and allows them to highly automate time-consuming tasks like tax management, rebalancing, and personalization. Through these capabilities, advisors can spend more time growing their businesses and deepening client relationships without sacrificing a differentiated investment experience.

Smartleaf Asset Management (SAM), YieldX, Jacobi Inc, and Principal are not affiliated.