BlackRock and Partners Group Introduce Diversified Private Markets SMA Solutions

In a strategic collaboration, BlackRock and Partners Group have unveiled new separately managed account (SMA) strategies designed to deliver diversified exposure to private market asset classes through a single investment vehicle. These upcoming multi-alternative SMAs allocate capital across private equity, private credit, and real assets via seven evergreen private market funds helmed by BlackRock, HPS, and Partners Group, as stated in official communications from the firms. The product lineup consists of three distinct portfolio strategies categorized by investment objectives: income-focused, balanced, and growth-oriented. Each strategy targets varying risk and return profiles suitable for different client needs, enhancing advisors’ ability to tailor private market allocations within their clients' broader portfolios. Importantly, these SMA offerings will be accessible on the Morgan Stanley wealth management platform, widening the reach to registered investment advisors and their clients. Rob Collins, co-head of private wealth at Partners Group, emphasized the importance of the structure by noting that embedding diversified private market exposure into a scalable SMA framework supports advisors in transitioning from mere product selection toward comprehensive portfolio solutions. This approach not only broadens access to a vital segment of the real economy but also addresses key challenges traditionally faced in integrating private market strategies. BlackRock brings extensive expertise in the separately managed accounts space, managing over $250 billion in assets through its SMA platform and maintaining more than four decades of experience. This foundation underpins the newly launched platform’s objective to simplify and democratize private market access, mitigating common hurdles such as insufficient portfolio diversification and historical underallocation to private assets. Jon Diorio, head of alternatives for BlackRock's U.S. Wealth Business, highlighted the synergy between the two firms by explaining that combining BlackRock’s expansive private markets platform, portfolio construction proficiency, and SMA capabilities with Partners Group’s specialized private markets knowledge results in a comprehensive solution. This integrated offering aims to empower financial advisors with broad investment opportunities and ultimately support improved outcomes across client portfolios. The product launch corresponds with evolving marketplace dynamics where demand for holistic portfolio construction solutions continues to rise. According to statements by the two firms, this trend stems from a confluence of investment and industry developments. The complexities and diversification challenges apparent in public equity markets, alongside diminished bank activity in credit markets, accentuate the strategic role of private markets in enhancing portfolio risk-return profiles. Historically, private markets have delivered approximately 100 basis points of incremental annual return relative to public investments at comparable risk levels, underscoring their value proposition. Concurrently, rising wealth concentration among high-net-worth and ultra-high-net-worth households—now commanding 54 percent of household financial assets totaling around $49 trillion—fuels demand for sophisticated portfolio solutions with diversified private market exposure. This demographic shift is profoundly influencing growth opportunities for financial advisors, highlighting the importance of providing broader private market access and highly tailored portfolio construction techniques. Ultimately, the BlackRock and Partners Group SMA collaboration seeks to bridge prevalent investor needs for diversification and private market engagement within a scalable, advisor-friendly format. By streamlining access to multiple private market segments and leveraging experienced asset management expertise, these solutions offer the potential to enhance portfolio resilience and capture opportunities embedded in the real economy.