Editorial Note: The content of this article is based on the author’s opinions and recommendations alone and is not intended to be a source of investment advice. It may not have not been reviewed, commissioned or otherwise endorsed by any of our network partners or the Investment company.
Updated on Friday, June 12, 2020
Silvercrest Asset Management Group, LLC provides financial planning, investment management and family office services primarily to ultra wealthy individuals and families, as well as certain institutional investors. The team of more than 140 employees is headquartered in New York, and there are seven additional offices across the country. The firm currently has more than $25 billion in assets under management (AUM), with plans to continue growing.
All information included in this profile is accurate as of June 12, 2020. For more information, please consult Silvercrest Asset Management’s website.
|Assets under management: $25,070,080,215|
|Minimum investment: Not specified, but clients with at least $10 million are generally targeted|
|Fee structure: A percentage of AUM; fixed fees; performance-based fees|
|Headquarters:||1330 Avenue of the Americas, 38th Floor
New York, NY 10019
- Overview of Silvercrest Asset Management
- What types of clients does Silvercrest Asset Management serve?
- Services offered by Silvercrest Asset Management
- How Silvercrest Asset Management invests your money
- Fees Silvercrest Asset Management charges for its services
- Silvercrest Asset Management’s highlights
- Silvercrest Asset Management’s downsides
- Silvercrest Asset Management disciplinary disclosures
- Silvercrest Asset Management onboarding process
- Is Silvercrest Asset Management right for you?
Overview of Silvercrest Asset Management
Silvercrest Asset Management Group, LLC was founded in 2002 as a registered investment advisor, independent from any brokers or banks. The firm’s parent company, Silvercrest Asset Management Group, Inc. went public in 2013 and trades on the Nasdaq under ticker SAMG. Each senior portfolio manager on the team is a shareholder.
Through both organic growth as well as nine strategic acquisitions, the firm has grown to manage more than $25 billion in assets. The team of 142 employees includes 58 who perform advisory and research roles, as well as accounting and tax experts for the family office services.
Aside from its headquarters in New York City, the firm has additional offices in Boston, Milwaukee, San Diego, Princeton, N.J., Bedminster, N.J., Charlottesville, Va. and Richmond, Va.
What types of clients does Silvercrest Asset Management serve?
Silvercrest Asset Management seeks out ultra wealthy individuals and families with at least $10 million or more to invest. The firm’s assets are often spread across multiple generations and among varying individual, retirement, trust and estate planning vehicles. The average client has $31 million invested. The firm does not currently have any individual clients who do not meet the definition of a high net worth individual, which the SEC defines as someone with at least $750,000 in assets under management or a net worth of at least $1 million.
In addition to wealthy individuals and families, the firm serves certain institutional investors including charitable organizations, pension and profit-sharing plans, endowments and foundations, among others. Institutional investors account for nearly three-tenths of the firm’s assets under management, with the remainder coming from wealthy individuals and families.
Services offered by Silvercrest Asset Management
Ultra-wealthy clients can enlist Silvercrest to help manage their investments, as well as their overall wealth. Clients generally opt for advisors to manage their portfolios under a discretionary relationship, meaning clients do not sign off on every trading decision. Some clients do seek advice and guidance from advisors but choose to retain control over the final trading and investment decisions, known as non-discretionary management. About three-quarters of the firm’s assets under management are in discretionary accounts.
The team can also address issues around estate, tax and retirement planning, business successions, family foundations, diversifying from concentrated stock or private assets and more. Family office services, such as paying bills, tax planning and preparation, accounting, financial planning and consolidated reporting, are also offered.
For institutional clients, the team provides portfolio advisory support, due diligence, risk analytics and other services. The team also offers outsourced chief investment services, and also advises many private funds.
Here is a list of services offered by Silvercrest:
- Portfolio management (separately managed; discretionary and non-discretionary)
- Financial planning
- Retirement planning
- Trust and estate planning
- Charitable planning
- Business planning
- Tax planning
- Family office services
- Bill paying
- Personal accounting
- Consolidated reporting
- Collaboration with clients’ lawyers, accountants, etc.
How Silvercrest Asset Management invests your money
At Silvercrest Asset Management, advisors first help clients define their goals for their wealth and investments. Next, they create and implement a custom plan to achieve those goals, based on each family’s unique situation. Clients who are personally opposed to certain types of investments can restrict the types of investments in their account.
Client money can be allocated across Silvercrest’s 20 equity and fixed-income strategies. Clients can also invest in Silvercrest’s private funds and with third-party portfolio managers, both of which can provide exposure to alternative investments, such as hedge funds, private equity and real estate.
When looking for companies to invest in, Silvercrest’s portfolio managers use a value-oriented approach. They look for companies that are attractively valued, understandable, transparent about their financials and headed by proven management teams with a lot of their own money at stake. The team says its stock portfolios “tend to underperform slightly in bull markets but outperform significantly in bear markets.” When looking for outside managers, the team looks for consistent returns, tax-efficiency and managers with significant equity at stake to align the interest of the managers and investors.
Fees Silvercrest Asset Management charges for its services
For portfolio management, clients typically pay an annual fee calculated as a percentage of assets under management. The percentage ranges based on the type of investment, as well as the amount invested. Fees are negotiable in certain situations, such as when clients have invested large amounts.
|Annual Fee Schedule for Separately Managed Accounts|
|Managed Equity or Balanced Portfolios||1% on the first $10 million, then 0.60%|
|Managed Fixed Income-Only Portfolios||0.40% on the first $10 million, then 0.30%|
|Managed Cash-Only Portfolios||0.20%|
|Silvercrest Municipal Value Strategy||0.65%|
Clients may also owe additional management fees and expenses when they invest with outside third-party managers or in private funds advised by Silvercrest. In the case of a private fund of funds, they’d owe even higher fees for the underlying managers those funds invest in. Clients may also owe certain performance-based fees, ranging from 10% to 30% of net income or capital appreciation, when investing with third-party funds or private funds advised by Silvercrest. The fee schedule is typically shared with clients in writing prior to beginning a relationship.
In addition to those management fees, clients can expect to owe brokerage and custodian fees, as well as any internal mutual fund, ETF or other investment product fees. Fees are typically paid quarterly and in advance, although this may vary.
Clients pay separately for family office services such as bill paying, tax planning and financial planning. The fees depend on the services requested, and are worked out prior to the start of the relationship.
Silvercrest Asset Management’s highlights
- Independent: The firm is not affiliated with any bank, broker, custodian or other financial services firm that ties clients to using that firm for specific services or products. Clients can choose the custodians and brokers they prefer.
- Family office services: Silvercrest offers ultra-wealthy families more than simply portfolio management. They can find assistance with bill paying, payroll management, medical insurance administration, accounting services, trust, estate and tax planning and other services necessary to handle vast wealth.
- National recognition: The firm placed fifth and seventh, respectively, in the 2018 and 2019 lists of the top registered investment advisory firms by the publication Barron’s, which ranks firms based on assets, revenue and quality of practice.
- Clean disciplinary record: The firm discloses no legal or disciplinary issues. See more below.
Silvercrest Asset Management’s downsides
- Limited to the ultra wealthy: The firm caters to ultra-high net worth individuals and families with at least $10 million to invest, as well as institutional investors. Thus, investors without eight-figure accounts should look elsewhere.
- Potentially high fees: Clients potentially face what is known as layered fees, where clients pay multiple underlying management fees. Together, the fees and expenses will be higher than what investors would have to pay if they directly invested in the underlying funds. For example, clients may invest in Silvercrest’s private funds, some of which may invest in other managed funds. The underlying manager fees may add on an additional 1% to 3% percent management fee and another 10 to 30% performance-based fee, on top of perhaps a fee already being paid to Silvercrest.
- Financial incentive to place riskier bets: Many of the private funds that Silvercrest advises and recommends charge performance-based fees, creating a financial incentive for portfolio managers to make riskier or more speculative investments than it may otherwise make. Performance-based fees also could motivate managers to allocate limited investment opportunities to funds that charge these fees, although the firm says it has policies in place to make sure opportunities are allocated equally.
- Pays for referrals: The firm formally uses 15 solicitors or other third parties to introduce clients to Silvercrest. Some of those solicitors receive payments from Silvercrest, often in the form of a percentage of the fees the referred client pays to Silvercrest.
Silvercrest Asset Management disciplinary disclosures
The Securities and Exchange Commission (SEC) requires all registered investment advisors to disclose on their Form ADV any legal or disciplinary actions against the company or an employee or affiliate in the last 10 years that would be material to clients’ evaluation of the firm or the integrity of the management team. Silvercrest Asset Management does not disclose any legal, regulatory or other disciplinary items, and thus has a clean record.
Silvercrest Asset Management onboarding process
As for communication once a relationship begins, clients with separately managed accounts receive written monthly or quarterly reports (per their preference) from Silvercrest summarizing their holdings, account activity and investment returns, in addition to the reports that clients receive from their custodian. Clients in the private funds also receive written monthly or quarterly reports with the investment values and returns.
The firm does not recommend or require that clients use any particular broker or custodian. When clients request that some or all trades go through a particular firm, however, they may pay more in costs.
Is Silvercrest Asset Management right for you?
Individuals and families with more than $10 million to invest who are also looking for additional help in managing and simplifying their vast wealth may want to consider Silvercrest Asset Management, particularly if they live near one of their firm’s eight offices. Clients may find it attractive that the firm is independent and not affiliated with any big banks or brokerage firms.
That said, it’s obviously a limited number of investors with the ultra wealth necessary to work with the firm — everyone else will need to look elsewhere. As is always the case when looking for a financial advisor, clients should consider at least two or three options to find the best fit for their needs and the amount of money they plan to invest.