The world's largest asset manager, BlackRock, is seeking to increase its services to financial advisers by acquiring a 4.9% stake in fintech company Envestnet.
The New York-based giant is buying its influential stake for $123m, according to a statement BlackRock issued yesterday.
Envestnet's wealth management platforms are currently used by about 92,000 financial advisers around the world, and offer portfolio management, reporting and other features. There are an estimated 300,000 financial advisers based in the US.
The deal comes as financial advisors move away from stock and bond picking, in favour of model portfolios built and managed by third parties.
Venu Krishnamurthy, BlackRock's global head of digital wealth, said in a statement on Tuesday: "As wealth managers shift to fee-based advisory relationships, they are asking for new technologies to help them scale their business and build better portfolios."