Brinker Cuts SMA Fees From 50 BPS Down to 20
March 1, 2004
Brinker Capital, one of the most preeminent providers of separately managed accounts, announced yesterday that it has broadened its "Destination" lineup to include passive large-core and real estate, and that it has reduced its fees from 50 basis points to 20 basis points.
Brinker, of King of Prussia, Pa., has reduced its fees, still using the same custodian, Fidelity Investment Advisory Group, "thanks to better technology and a more sophisticated custodial relationship," said Brinker President John Coyne.
Targeting investors with account sizes of $100,000 and $500,000, Brinker expects the lowered fee will appeal to a broader, more "fee-sensitive" group, Coyne said.
"Brinker has brought on a number of new registered investment advisor relationships and added selling agreements with independent firms," Coyne explained. "We are gearing this towards new accounts and advisers."
And as to the reason for the two new investment styles, Jim Harrington, chief investment officer at Brinker, said that the real estate offering is meant to offer diversification outside of equities and bonds, and that large-cap core "is the most efficient sector of the market."
As to how the firm was able to cut its fees by more than half, Brinker executives explained that it is still being run on the same platform, but that they were able to find additional efficiencies.
"We developed the chassis almost nine years ago," Coyne said. "We went back and looked at how we could reorganize this product to make it more appealing. Thanks to better technology and a more sophisticated custodial relationship," Brinker has brought its program costs down to 20 basis points, he said.
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