How Thrivent is Expanding its Investment Solutions with Retail Separately Managed Accounts (SMAs)

Thrivent has launched three new retail SMAs — Large Cap Growth SMA, Large Cap Value SMA, and Small-Mid Cap Equity SMA — expanding its suite of sophisticated investment solutions and deepening its commitment to helping clients achieve their financial goals.

Below, Michael Kremenak, Thrivent Funds president, shares why Thrivent is offering retail SMAs and what the expansion means for clients and financial advisors.

Q: What is a retail SMA and how does it differ from mutual funds or ETFs?
A retail SMA is a professionally managed portfolio of individual securities aligned to a specific investment strategy within a particular asset class. Thrivent’s initial SMA lineup focuses on large cap growth, large cap value and small-mid cap equity.

Here’s how it works: Thrivent Asset Management provides a professionally constructed portfolio designed to provide competitive, long-term returns in a specific asset class.  A financial advisor can then personalize the portfolio for a client by adjusting the holdings, preferences and constraints, resulting in an account uniquely aligned to the client’s goals. This structure allows clients to outsource investment management while still benefiting from greater control, transparency and potential tax efficiencies.

With an SMA, clients own the individual securities in their account, unlike mutual funds or ETFs, which offer pooled ownership through fund shares and are designed for broad investor groups.

Q: What are the benefits of retail SMAs?
While there are many, I’ll call out five:

• Personalization: A financial advisor works with the client to tailor the portfolios to reflect what matters most to them—whether that’s selecting or avoiding certain types of investments.
• Targeting: SMA portfolios are generally built around a single asset class, allowing the client to focus on a specific investment objective.
• Tax efficiency: With SMAs, the financial advisor can sell certain investments at a loss and better control when gains are realized, potentially lowering a client’s tax liability compared to pooled vehicles, like mutual funds or ETFs.
• Direct ownership: Clients own the individual securities rather than mutual fund or ETF shares.
• Transparency: Clients can see each holding and how it’s performing in real time rather than relying on aggregated fund data.  

Q: Why are SMAs growing so quickly and what market trends are driving investor demand?
SMAs are growing in popularity because they provide greater control, transparency and personalization—attributes which some higher-net-worth investors value and are willing to pay for. In fact, industry projections show SMAs are on track to surpass $5 trillion in assets by the end of 2026.

Certain investors today want to better understand what they own and tailor their portfolio to their individual goals, interests, and investment preferences. SMAs make that level of customization possible.

Alongside mutual funds and ETFs, SMAs can serve as a long-term building block in a diversified portfolio, helping clients pursue financial goals with more precision and choice.

Q: What motivated Thrivent to launch retail SMAs now, and how does this expansion fit into the broader investment product strategy?
Investor preferences are evolving - some financial advisors and investors want even greater control and personalization within their investment solutions. SMAs give us a sophisticated way to meet those expectations, while also bringing the benefit of our long-term investment philosophy and active management approach.

Q: How do these new retail SMAs reflect Thrivent’s strengths in active management and long‑term investing?
Thrivent’s active management approach is central to the new SMAs. They’re managed by the same experienced asset management professionals who oversee the underlying investment strategies used in Thrivent’s mutual funds and ETFs. This means clients benefit from our rigorous investment process.

Active management means we’re constantly evaluating opportunities, adjusting positioning and seeking ways to add value over time. By offering this expertise in an SMA vehicle that financial advisors can then customize for individual clients, we’re giving investors the flexibility and transparency they want, paired with our trusted active management approach.

Q: Why did Thrivent choose to launch SMAs in Large Cap Growth, Large Cap Value and Small-Mid Cap Equity first?
We started with these SMAs because our teams have deep investment experience and expertise in these categories. We look forward to continuing to expand our suite of investment solutions by leveraging areas where we have strong capabilities and can offer products to clients that serve as core building blocks for their portfolios.

Investing involves risk, including the possible loss of principal. Investors should consider the investment objectives, risks, charges, expenses and other information carefully before investing.

The implementation of or reliance on a model portfolio is at the discretion of the managed account sponsor. Thrivent model portfolio information is intended for use only by third-party adviser firms in conjunction with their management of their clients’ accounts.

Thrivent Asset Management, LLC (“TAM”), an SEC-registered investment adviser, provides third-party sponsors of managed accounts with non-discretionary investment advice in the form of models. TAM does not provide personalized investment advice or investment recommendations and will not make any representations about the suitability of a strategy or model for any investor.

Thrivent Asset Management, LLC is a subsidiary of Thrivent.