Unified managed accounts are private investment accounts that are managed by a professional on behalf of an investor. Accounts of this type make it possible for a variety of investment vehicles to be rebalanced and maintained by the single professional, rather than dealing with a multiplicity of brokers, dealers, and others. A unified managed account allows the investor to interact with one individual on placing orders to buy or sell, tracking gains and losses within the portfolio, and in general reordering the contents of the portfolio to meet the needs of the client.
With a unified managed account or UMA, it is possible to include many different types of investments. Along with stocks, the account may also include bond issues, currency trades, mutual funds, commodities, and real estate holdings. In situations where the investor is involved in a joint venture, the returns from those efforts can also be managed through the account.
For the investor, the creation of a unified managed account makes it possible to quickly access data about all current investments, regardless of the nature of those investments. This eliminates the need to compile information from several different sources in order to determine the current value of the investment portfolio. The manager of the account can easily provide the investor with immediate data regarding what is happening with each holding, and how that activity is affecting the overall worth of the investor’s assets.
Along with providing the advantage of a single source of information, having a unified managed account can also make it possible to buy and sell investments of different types in order to take advantage of shifts in those markets. For example, the manager can quickly sell investments in a foreign exchange market if currency rates are about to drop, and reinvest the money in a stock that is anticipated to increased dramatically in value in the short term. Executing various combinations of orders to strengthen the position of the investor can take place in less time than would be required if several different managers were involved.
Finding the right manager for a unified managed account can sometimes be difficult. The manager must be familiar with a wide range of markets, be able to interpret the potential impact of various events on the assets held in the account, and provide solid financial advice to the investor. Today, there are investment firms that specialize in offering management services of this type. Often, the charges related to the establishment and ongoing management of a UMA will include a flat fee per month, as well as additional fees based on instructions issued by the investor to execute some order related to the investments within the account.