Advice Delivery
Advice DeliveryNextCapital enables your institution to deploy your proprietary advice methodology or NextCapital’s.
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Asset classesAsset class hierarchy serves as the foundation for constructing diversified investment portfolios. Your institution may utilize its own asset class palette, or NextCapital’s.
Your institution can also elect to provide capital market assumptions (CMAs) and run simulations to generate wealth projections. We generate expected short and long-term CMAs that reflect the return premium, risk, and co-movements of global markets. |
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Asset class portfoliosYour institution may elect to implement its own model asset allocation portfolios as the baseline for portfolio construction in a goal-based or risk-based framework.
Our OpenEngine allows your institution to input its own glidepath parameters and starting point for investors. The OpenEngine default setting uses an age-based asset allocation glidepath as the anchor for advice as an investor approaches their retirement goal. Institutions also have the option to leverage NextCapital’s asset class hierarchy and palette, or use their own. |
Security assignmentYour institution can choose actively managed or index-based investment portfolios to be utilized in security assignment to asset classes. For 401(k) plan advice, our OpenEngine analyzes the available lineup of mutual fund, ETF, CIT, and stable value funds, and optimizes investment portfolios for the respective asset class portfolio.
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Portfolio assignmentOur OpenEngine makes individualized portfolio recommendations based on investor profile data provided from the recordkeeping/custodian systems and/or the individual investor. Investor profile data, goal-based, and risk tolerance questions can also be used to modify portfolio assignment on the benchmark age-based glide path. The planning process can be driven by the investor or by a financial advisor servicing an investor.
Based on additional information gathered throughout the planning process, each investor will receive a more personalized glidepath to follow. If your institution has a dynamic advice algorithm it is not necessary to provide or use a glide path. |
Portfolio managementOur OpenEngine rebalancing process is flexible and can be configured according to your institution's specifications. In-plan defined contribution accounts are rebalanced according to mutually agreed schedules and/or events. Additionally, NextCapital also offers smart rebalancing for tax loss harvesting and optimized asset allocation services for retail accounts.
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NextCapital Advisory Services
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NextCapital Advisers may provide advice and methodology services to clients on behalf of your Institution, both with respect to retail accounts opened through your Institution and on behalf of 401(k) programs facilitated by your Institution.
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In this capacity, NextCapital Advisers may conduct (i) model portfolio creation, whereby NextCapital Advisers generates model portfolios and maintains appropriate model portfolios consistent with each individual investor’s profile, and (ii) advice and wealth forecasting, using various proprietary models and algorithms taking into account certain capital market assumptions, forecasting configurations, simulation datasets, asset allocation models, advice personalization, asset classification, and investment selection.
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NextCapital RetirementIndexThe Retirement Index is the foundation for NextCapital’s proprietary investment methodology, and the industry’s only passive asset allocation advice solution.
The NextCapital RetirementIndex takes a passive view of asset allocation by using the consensus asset allocation of the world’s largest managers of TDFs . The managers that comprise the Retirement Index represent over 95% of the invested in public TDFs. Each portfolio index is fully investable. |
