Description of Advisory Firm
ALPS Advisors, Inc. (“AAI”) was founded in 2006. AAI is a
subsidiary of ALPS Holdings, Inc., (“AHI”) which is a subsidiary
of DST Systems, Inc. (“DST”), which in turn is a wholly owned
subsidiary of SS&C Technologies, Inc. SS&C Technologies,
Inc. is a wholly owned subsidiary of SS&C Technologies
Holdings, Inc. (Nasdaq: SSNC)(“SS&C”).
Description of Types of Advisory Services
Registered Investment Companies
AAI currently serves as an investment adviser to investment
companies (each a “fund” and collectively, the “funds”)
registered under the Investment Company Act of 1940 (“1940
Act”). AAI has the responsibility to appoint on behalf of the funds
it advises, sub-advisers with full investment discretion, which
may include the selection of brokers and other trading
counterparties. AAI has the responsibility to oversee the
activities of the sub-advisers and ensure that all transactions
comply with applicable regulations and prospectus covenants.
AAI also has the ability to serve as investment sub-adviser to
investment companies registered under the 1940 Act.
In addition, where AAI is the adviser or sub-adviser, there are
certain funds for which AAI will initiate placement, execution,
and settlement of trades. In these instances AAI will not actively
make specific security investment decisions. Rather AAI’s
trading desk will be responsible for initiating trades necessary to
keep the funds in line with a model portfolio provided by the
adviser, sub-adviser or, in the case of an exchange traded fund,
the indexing agent or at the direction of the adviser or sub-
adviser.
Sub-Advisory Services
AAI will enter into sub-advisory agreements with other
registered investment advisers to provide certain investment
management services those advisers. The sub-advisory
services offered by AAI include but are not limited to: conducting
trades in custodial accounts as directed by the primary adviser;
providing access to model portfolios managed by third party
investment managers; and providing a platform to assist the
primary adviser with implementing model portfolios managed by
the primary adviser.
Other registered investment advisers who enter into a sub-
advisory agreement with AAI will delegate their discretionary
authority to conduct trades on behalf of specified accounts held
at a custodian. AAI will use this discretionary authority to
implement model portfolio selections or direct trade instructions
provided by the primary investment adviser. When AAI acts as
a sub-adviser, the primary adviser is responsible for ensuring
that it complies with all applicable statutes, regulations, and
rules. Furthermore, the primary adviser is responsible for
assessing whether instructions, provided to AAI, regarding the
selection of a model portfolio, the purchase of a security, or the
sale of a security meet the applicable suitability/best interest
standards.
Retirement Solutions
Establishing a sound fiduciary governance process is vital to
good decision-making and to ensuring that prudent procedural
steps are followed in making investment decisions. AAI may
provide retirement plan services to plans and plan fiduciaries, as
described below. The Employee Retirement Income Security
Act of 1974 (“ERISA”) sets forth rules under which plan
fiduciaries may retain investment
advisers for various types of
services with respect to plan assets. For certain services, we will
be considered a fiduciary under ERISA. For example, we will act
as an ERISA § 3(21) fiduciary when providing non-discretionary
investment advice to the plan fiduciaries by recommending a
suite of investments as choices among which plan participants
may select. With respect to any account for which we meet the
definition of a fiduciary under Department of Labor rules, we
acknowledge that both the firm and its related persons are acting
as fiduciaries.
Services will be provided under the terms and conditions of a
licensing agreement, whereby AAI provides investment
analysis, investment performance data and mathematical
modeling techniques for use in investment advice software
made available to authorized plan participants. Through the
software, AAI may provide investment recommendations,
among a suite of investments, to authorized plan participants.
These investment recommendations will constitute investment
advice under ERISA § 3(21). Prior to accepting investment
advice, authorized plan participants have the option of entering
into an advisory agreement with AAI, which outlines the risks
and limitations of accepting such advice.
Additional disclosure is found elsewhere in this Brochure or in
the written agreement between us and the client.
Model Portfolio Solutions
AAI constructs and provides model portfolios to other registered
investment advisers through SS&C Rendezvous. Among other
things, SS&C Rendezvous provides investment advisers the
ability to assess their client’s portfolios, implement model
allocations, and monitor investments across their accounts.
SS&C Rendezvous is solely available to investment advisers
through SS&C Advent, an affiliate of AAI, and its Black Diamond
Wealth Platform (the “Platform). Investment advisers have the
ultimate decision making and discretionary responsibility for the
determination of which securities are to be purchased and sold
for their account and effect all security transactions in
connection with such determinations. In addition, AAI has no
specific knowledge of the investment adviser’s clients or their
circumstances.
ALPS Advisors, Inc. 5
Model portfolios will include third-party ETFs and ETFs that are
advised by AAI (“Affiliated ETFs”). As a result, the AAI’s conflict
in selecting Affiliated ETFs within a particular model is
heightened because it has an additional incentive to decrease
the model portfolio's allocation to third-party ETFs in order to
increase the investment advisory fees it receives. Refer to Item
5 “Fees and Compensation” below for additional conflicts of
interest disclosures.
Investment adviser representatives of AAI may provide
consultative support and investment advice to investment
advisers regarding model implementation and selection.
Red Rocks Global Listed Private Equity Index
AAI has developed and maintains the Red Rocks Global Listed
Private Equity Index (the “Index”). The Index is the basis for an
exchange-traded fund which is managed by an unrelated party
(the “ETF Provider”).
Assets Under Management
As of February 29, 2024, AAI had the following client assets
under management:
Discretionary Assets $24,019,792,910
Non-Discretionary Assets $0
Total Assets Under Management $24,019,792,910