Five Lessons for Advisors Using Model Portfolios
Published January 6, 2025
Ryan Krystopowicz, CFA
Director of Client Solutions
Key Takeaways
- As financial advisors face increasing portfolio management complexities, model portfolios have emerged as a vital tool for scaling practices while enhancing client results.
- Research shows clients trust advisors more when they collaborate with third-party model providers, viewing them as “Financial MDs” delivering specialized, data-driven solutions.
- WisdomTree’s Portfolio Solutions platform offers personalized consultations, CIO-managed model portfolios and custom model solutions, enabling advisors to meet diverse client needs and future-proof their practices.
Listen to the blog post below:
Recently I was a guest on Advisorpedia’s Power Your Advice podcast, which was a fantastic opportunity to connect with the financial advisor community. In our conversation, we explored strategies for advisors to grow their practices, deliver greater client value and leverage tools like model portfolios—all while focusing on holistic client care. Here are five lessons from our discussion.
1.Embrace the Evolution: Model Portfolios Are Here to Stay
Early in my career, I worked as a stock picker at a registered investment advisor (RIA). While this provided valuable insights into individual investments, it highlighted a critical truth: managing portfolios through stock selection is often inefficient and suboptimal. Consistently outperforming a benchmark is a challenge even for seasoned professionals with robust resources.1
For most advisors, time spent on stock picking can be better allocated to high-value activities like financial planning and client engagement. The industry has recognized this, as the adoption of model portfolios continues to surge. By 2028, assets in model portfolios are projected to surpass $10 trillion.2 This evolution is about more than efficiency; it’s about delivering better client outcomes.
2.Clients Value Expertise, Not Control
A common misconception is that outsourcing portfolio management diminishes an advisor’s value proposition. At WisdomTree, our research tells a different story. Most clients embrace third-party models, with 9 out of 10 finding it acceptable and 7 out of 10 believing it enhances portfolio performance.3
This trend reflects how clients view their advisors—as “Financial MDs” who diagnose and prescribe the best financial solutions, leveraging the expertise of specialists. Much like patients trust their doctor’s informed recommendations, clients appreciate advisors who partner with model portfolio providers to deliver strategies backed by rigorous research and analysis.
3.Unlock Potential with WisdomTree’s Portfolio Solutions Platform
With 300,000 financial advisors in the U.S., there’s no one-size-fits-all approach to managing portfolios.4 Advisors need solutions as diverse as their clients and goals. That’s why WisdomTree created the Portfolio Solutions platform—a customizable suite designed to empower your practice.
- Portfolio Consultations: Personalized portfolio reviews and tailored recommendations for advisors managing portfolios in-house.
- CIO-Managed Model Portfolios: Professionally managed portfolios, ideal for advisors seeking turnkey solutions backed by our dedicated Model Portfolio Investment Committee.
- Custom Model Solutions: Collaborate with WisdomTree to co-create portfolios, blending your insights with institutional-level expertise.
4.Enhance Client Relationships
Outsourcing portfolio management isn’t just operationally transformative—it strengthens client relationships. Advisors using model portfolios report improved client retention, increased referrals and higher satisfaction.5 By focusing less on portfolio construction and more on client-facing activities, advisors can deepen connections and expand their reach.
With nearly 40% of clients open to switching advisors, the majority prefer working with those leveraging third-party models.6 This underscores an essential truth: embracing models isn’t just efficient; it aligns with modern client expectations.
5.Build a Practice for the Future
The financial advisory profession is at a pivotal moment. Adopting tools like model portfolios isn’t optional—it’s crucial for advisors seeking to scale their practices, build client trust and stay competitive. At WisdomTree, our mission is to provide the resources and flexibility they need to thrive.
For the financial advisors reading this, where is your time best spent? Are you ready to embrace the tools shaping the future of financial advice? With the Portfolio Solutions platform, you can focus on what matters most—your clients and their financial well-being.
Listen to the full discussion below:
1 "Is Stock Picking Dead?", WisdomTree, 1/3/23, www.wisdomtree.com/investments/blog/2023/01/03/is-stock-picking-dead.
2 BlackRock projection.
3 WisdomTree Research Study 2020.
4 U.S. Bureau of Labor Statistics (BLS) data.
5 “Impact of Outsourcing” whitepaper by AssetMark.
6 WisdomTree Research Study 2020.
Important Risks Related to this Article
For financial advisors: WisdomTree Model Portfolio information is designed to be used by financial advisors solely as an educational resource, along with other potential resources advisors may consider, in providing services to their end clients. WisdomTree’s Model Portfolios and related content are for information only and are not intended to provide, and should not be relied on for, tax, legal, accounting, investment or financial planning advice by WisdomTree, nor should any WisdomTree Model Portfolio information be considered or relied upon as investment advice or as a recommendation from WisdomTree, including regarding the use or suitability of any WisdomTree Model Portfolio, any particular security or any particular strategy.
For retail investors: WisdomTree’s Model Portfolios are not intended to constitute investment advice or investment recommendations from WisdomTree. Your investment advisor may or may not implement WisdomTree’s Model Portfolios in your account. The performance of your account may differ from the performance shown for a variety of reasons, including but not limited to: your investment advisor, and not WisdomTree, is responsible for implementing trades in the accounts; differences in market conditions; client-imposed investment restrictions; the timing of client investments and withdrawals; fees payable; and/or other factors. WisdomTree is not responsible for determining the suitability or appropriateness of a strategy based on WisdomTree’s Model Portfolios. WisdomTree does not have investment discretion and does not place trade orders for your account. This material has been created by WisdomTree, and the information included herein has not been verified by your investment advisor and may differ from information provided by your investment advisor. WisdomTree does not undertake to provide impartial investment advice or give advice in a fiduciary capacity. Further, WisdomTree receives revenue in the form of advisory fees for our exchange-traded Funds and management fees for our collective investment trusts.
References to CIO (Chief Investment Officer), “CIO-Managed” and “Shared CIO” are meant as a general reference to WisdomTree Model Portfolio subscriptions, consultation regarding WisdomTree Model Portfolios and WisdomTree Model Portfolios that may be customized to firm-specific objectives or unique firm-specific investment needs (“custom model portfolios”), and WisdomTree is not acting in an investment advisory, fiduciary or quasi-fiduciary capacity in connection therewith. Such material, and any assistance provided as described herein, including portfolio construction, WisdomTree Model Portfolios, custom model portfolios, asset allocation stress testing, assessments, discussions, output or other assistance (whether by WisdomTree personnel or digital tools) are (i) for information only and are not intended to provide, and should not be relied on for, tax, legal, accounting, investment or financial planning advice, (ii) not personalized investment advice or an investment recommendation from WisdomTree and (iii) intended for use only by a financial professional, with other information, as a resource to help build a portfolio or as an input in the development of investment advice for its own clients. Such financial professionals are responsible for making their own independent judgment as to how to use such information.
About the contributor
Ryan Krystopowicz, CFA
Director of Client Solutions
Ryan Krystopowicz is Director of Client Solutions at WisdomTree, where he helps drive the commercialization of model portfolio solutions and supports advisor growth strategies. He plays a central role in WisdomTree’s Model Portfolio Research Study, advancing insights on model adoption, advisor behavior and prospecting opportunities. His passion for third-party model portfolios and investment outsourcing was cultivated during his tenure at a Registered Investment Advisor, where he held roles across research and operations. Ryan also brings WisdomTree’s research on advisor online presence to life through high-impact programming that turns key findings into practical guidance for improving digital credibility and prospect engagement. He is a CFA charterholder and a graduate of Loyola University of Maryland.