Custom Municipal SMA

Technology creates better client outcomes

AB's technology-driven municipal bond platform automates the portfolio construction process to generate additional alpha and help investors better achieve their personalized investment goals.

Our Technology Creates Better Outcomes

$125k Minimum for a Custom SMA

Technological efficiencies enable seamless customizations for account sizes large and small. From personalizing portfolios to meet ESG preferences or to automate tax-loss harvesting, we seek to create better client outcomes.

Trading Alpha

Faster more efficient trading is required to execute on mispriced bonds in the marketplace. The traditional analog method of trading could lead to missed opportunities. With technology, we constantly assess value in the market, and seamlessly execute across portfolios.

Speed Alpha

By introducing automation into the traditional portfolio construction process and eliminating bottlenecks, AbbieOptimizer enables us to implement clients’ portfolios much faster. On average, we can fully invest portfolios in 10 days from funding—providing conditions warrant it—versus the estimated industry average of 50 days.

Tax Alpha

Fixed Income SMAs employing systematic tax optimization can add more than 80 bps to after-tax returns in a given calendar year. To achieve this, AB has developed and implemented sophisticated tools to enhance optimization, pricing, liquidity and execution processes to harvest this non-traditional alpha source for our clients.

Optimizing for Alternative Alpha Sources & Customizations

AB’s AbbieOptimizer^SM is a proprietary technology that automates AB’s municipal bond portfolio construction process. The tool integrates trading, pricing and portfolio construction to build customized client portfolios from idea to execution faster and with better results than traditional processes.

This automated process revolutionizes the way portfolios are invested, providing the opportunity for added alpha from tech-powered trading efficiencies and portfolio construction speed.

~30-40 bps*

Average Trading Alpha Generated

~5-15 bps†

Average Speed Alpha Generated

49 bps‡

Average Tax Alpha Generated

01 / 03

A Revolutionary Approach With Revolutionary Results

Unlike a traditional municipal bond ladder portfolio, AB's AbbieOptimizer harnesses technology to unlock significant, yet unconventional, sources of alpha in the portfolio construction process.

_{As of November 30, 2021.}

_{*Trading alpha is the average of our execution price minus the bond’s end-of-day evaluation price on that day divided by the account assets under management. †Speed alpha is additional income accrued from investing portfolios faster than the industry average. ‡Tax Alpha results are based off of simulated aggregated data from a representative index (Blended Bloomberg 1-10 Year Muni Intermediate Index) applying AB’s production tax optimization algorithm. Based on an average of tax alpha generated from the four calendar years 2018-2021.}

Table comparing AB Custom Municipals versus Traditional Municipal Ladder

Customizations to Match Client Needs...

Illustration showing customization elements of AB Municipals

Building a Custom Municipal SMA

Use AB's SMA Design Center to customize client portfolios to fit their individual needs. Choose a core...

Contact Us

Get in touch with our team for more information on the AB Custom Municipal SMA solution.

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Featured White Paper

Insights

Impact Investing: Addressing Local Needs with Precision and Purpose

Muniland: Port in the Storm

Muniland: Whiplash

Webcast: Taking Muni Bonds to the Next Level

Investment Products Offered:

Are Not FDIC Insured | May Lose Value | Are Not Bank Guaranteed

There is no assurance that a separately managed account will achieve its investment objective. Separately managed accounts are subject to market risk, the market values of securities owned will fluctuate so that your investment, when redeemed, may be worth more or less than its original cost.

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