A separately managed account (SMA) is a professionally managed investment portfolio tailored to an individual investor's needs rather than pooled with others. Unlike mutual funds or ETFs, SMAs provide direct ownership of securities, offering more control over investment decisions and tax strategies. 

Originally created for institutional investors, SMAs have grown in popularity, with assets under management reaching nearly $2.2 trillion by 2023. 

Their key advantages include flexibility in strategy, greater tax efficiency, real-time transparency, and typically lower fees compared to actively managed mutual funds. Investors can customize holdings and optimize tax implications through strategies like tax-loss harvesting. 

Finsum: While SMAs can be cost-effective, additional fees from financial advisors may apply, impacting overall expenses.

The municipal bond market experienced fluctuations in 2024, with tax-free yields rising in response to Treasury yield movements, particularly in the latter half of the year. Market uncertainty increased following the Federal Reserve’s December rate cut, which coincided with ongoing inflation concerns and economic crosscurrents. 

As 2025 begins, the potential extension of 2017 tax cuts under the new administration may impact demand for tax-free bonds, particularly if corporate tax rates are lowered. Climate-related risks, such as the LA fires and hurricanes, have drawn attention to municipal finance, with increased insurance costs and resilience measures potentially leading to more bond issuance. 

Despite these pressures, municipal credit quality remains stable, supported by strong reserves, prudent budget management, and infrastructure reinvestment. However, challenges persist in certain sectors, including healthcare, higher education, and public K-12 schools, due to shifting demographics, rising costs, and expiring pandemic aid.

Finsum: These are important things to monitor for municipal bonds, and the increasing role of DOGE, could drastically change this bond segment. 

Vanguard announced its largest-ever expense reduction, cutting fees on 87 funds by one to six basis points, translating into over $350 million in investor savings for 2025. The lower costs apply to a range of funds, including bond mutual funds, ETFs, U.S. and international equities, and money market funds. 

CEO Salim Ramji emphasized that reduced fees help investors retain more returns, aligning with the firm’s broader strategy to expand its fixed-income offerings. Chief Investment Officer Greg Davis highlighted the growing role of bonds in investor portfolios and the long-term benefits of compounding savings.

 Vanguard, managing $10.4 trillion as of November 2024, has consistently lowered investing costs since its founding by Jack Bogle in 1975. Competing with BlackRock, it remains one of the world's largest providers of low-cost ETFs, offering 428 funds globally, including 212 in the U.S.

Finsum: Advisors need a strategy to articulate the importance of fee structure to clients, because its integral to their portfolios and can strengthen relationships by providing clarity and demonstrating communication.

Former President Donald Trump’s newly announced sovereign wealth fund has sparked speculation that it may include Bitcoin and other cryptocurrencies. Given his administration’s support for digital assets, experts believe this fund could serve as a vehicle to invest in crypto without bureaucratic hurdles. 

Some argue that incorporating Bitcoin and other digital assets could bolster the U.S. economy while positioning the country as a leader in the crypto sector. However, skeptics highlight the risks of volatility, regulatory uncertainty, and governance challenges tied to managing crypto within a government-backed investment fund. 

Other nations, including Norway, already have exposure to Bitcoin through their sovereign wealth funds, further fueling debate over the potential impact of the U.S. following suit. 

Finsum: If implemented, this move could accelerate institutional adoption of crypto while reinforcing America’s role in the evolving digital asset landscape.

For years, wirehouses dominated the wealth management industry, but a growing number of advisors are breaking away to join independent RIAs. What was once seen as a risky move has now become a mainstream trend, with firms like Hightower Advisors playing a key role in accelerating the transition. 

A decade ago, wirehouse executives dismissed concerns about advisors leaving, pointing to stable headcounts, but the shift has proven undeniable. Cerulli data projects wirehouse market share will drop to 27.7% by 2027, with RIAs benefiting from the exodus. In 2024 alone, wirehouses experienced a net loss of 612 advisors, while RIAs gained 856, reflecting the increasing appeal of independence. 

With factors like autonomy, higher earnings potential, and access to cutting-edge technology driving the movement, the trend shows no signs of reversing—raising the question of how much longer wirehouses can sustain their traditional model.

Finsum: We really think technology is adapting how advisors are thinking about their evolution within a firm, wirehouses need to give them the most opportunities.