Have you updated your software lately? Security researchers worldwide are recommending that everyone install available software updates on computers and mobile devices in the wake of vulnerabilities called Meltdown and Spectre. The exploit allows malicious software to retrieve data from computer memory used by other programs, potentially exposing things like passwords, instant messages, bank account numbers and more. In addition to updating software, experts recommend installing open source content-filtering software like uBlock Origin in your internet browser to block malicious code.
Vanguard Personal Advisor Services Exceeds $100 billion AUM
In online investment news, Vanguard’s Personal Advisor Services crossed a milestone of $100 billion dollars in assets under management, becoming the first of the low-cost hybrid advice services to do so. While online investing startups have raised hundreds of millions in dollars in venture capital to tackle this market, established incumbents like Vanguard are having the most success in attracting assets to their digital platforms. Here’s Riskalyze CEO Aaron Klein with his thoughts on Vanguard’s milestone.
“Vanguard has found a way to profitably bring hybrid human-robo advice to the market, and there is absolutely a need for better advice among smaller investors,” he adds. “The big realization most advisors have had is that Vanguard is serving a different market — one that will accept simpler, phone-based advice. It’s a rising tide that is lifting the advice boat and that’s a good thing for the industry.”
Reinvest 2017 Year-End Dividends in HSA Accounts
And do you or your clients have investments in you HSA accounts? if so, be sure to check with your HSA administrator to see what happened with dividends paid out at the end of 2017. Not all plans automatically reinvest dividends, so you may have to manually log in to your plan if you want the extra cash reinvested back into your HSA’s investment portfolio.
I’m Bill Winterberg, and those are your fintech headlines for today from FPPad.com, be sure to check back in with me later for more fintech news.
Today’s episode is brought to you by eMoney Advisor, who just announced their Fiduciary Framework initiative to help advisors and firms comply with the recent DOL Fiduciary Rule. The framework weaves DOL-friendly solutions into each stage of the advisor-client lifecycle—like client acknowledgments, event logs, best interest workflows, and more—all within the existing integrated wealth management platform.
[Now first up, I attended Schwab IMPACT 2016 in San Diego last week and posted a few videos about Schwab’s technology updates, including a detailed discussion with Brian Shenson about the phase out of Integrated Office, new providers in OpenView Gateway, and the much anticipated timeline of Portfolio Connect. It’s an informative interview, and stick around for the tour of OpenView MarketSquare where I Brian and I practiced our sprints in the massive exhibit hall.
And then on Monday this week, Riskalyze announced that the company secured $20 million in capital from FTV Capital to fuel its future growth. Here’s CEO Aaron Klein on how this additional capital will help Riskalyze execute on its mission.
Aaron Klein: “Our mission every day is making sure that we’re empowering those advisors to really build fearless investors, to align the world’s investments with each investor’s Risk Number, and you know, for us finding the right partner to allow us to continue the incredible growth we’ve seen so far was the right move.”]
[Next up is news from SS&C Technologies, which you should recognize as the company that acquired Advent Software for $2.7 billion earlier this year. Last week, SS&C announced it acquired Salentica, a professional services firm known for customizing Salesforce and Microsoft Dynamics CRM for institutions and large RIAs. Terms of the deal were not disclosed.
So this acquisition is important for its vertical integration, as thousands of advisors who already use Advent or Black Diamond for portfolio management today should soon benefit from better integrations of Salesforce and Dynamics CRM all from the same provider. This also helps SS&C close the gap with a competitor like Envestnet | Tamarac, who has offered an all-in-one technology solution to advisors for several years.
But on the other hand, not all advisors want to be captive to an all-in-one provider, and prefer the best-of-breed approach to their technology, so with Salentica now under the ownership of SS&C, we’ll have to see how the political aspects of this relationship play out in the near future. Nevertheless, I’m optimistic that SS&C will support Salentica’s integrations with a variety of portfolio management providers, but I definitely would proceed with a little more caution if my business used a solution other than Advent and Black Diamond.] SS&C Technologies Holdings, Inc., a global provider of financial services software and software-enabled services, today announced its acquisition of leading CRM solution Salentica.
[And finally, I’m wrapping up with two updates involving TD Ameritrade, starting with the announcement of the acquisition of Scottrade for $4 billion dollars, then followed up by the soft launch of Essential Portfolios, the company’s own automated investment service for retail investors.
First, the Scottrade acquisition is likely to affect advisors with under $10 million in assets under management, as Scottrade has historically been welcoming of advisors with smaller accounts. So over the next year or two, I’d expect smaller advisors to be under pressure to grow their assets under management, or find another custodian altogether like Shareholders Service Group, or join a membership group like the XY Planning Network that leverages the size of its network to facilitate business with TD Ameritrade Institutional. Either way, I think it means structural changes are on the horizon for dozens of smaller advisory firms.
And the second story about Essential Portfolios adds yet another retail-facing automated investment solution to the crowded marketplace. It features a $5,000 account minimum, fees of 30 basis points, and offers just five model portfolios, each made up of five ETFs, with allocations recommended by Morningstar Investment Management that are automatically rebalanced.
Look, clients are getting bombarded with all this marketing about low-cost, automated, intelligent investing services from nearly every provider in the business. So unless your marketing pockets are as deep as theirs, you’re going to have to craft a message that your technology rivals that of the automated services, and that you offer advice and services that go way beyond what the low-cost solutions provide. Not only do you have to say it, but you have to do it.] TD Ameritrade announced on Monday that it would acquire Scottrade Financial Services, a rival discount brokerage, for $4 billion, in a bid for scale at a time when small investors are losing their taste for stock trading.
Here are the stories that didn’t make this week’s broadcast:
Twenty Over Ten, an unparalleled, compliant website-builder, today announced its formal public launch. Cofounded by Penn State Associate Professor of Graphic Design Ryan Russell and Designer and Developer Nick Dimatteo, Twenty Over Ten helps financial advisors create beautiful and compliant websites tailored to their unique brands.
PIEtech℠, Inc., creator of the leading financial planning software, MoneyGuidePro®, announced today that it is building a multi-faceted, deep integration with Riskalyze, the risk alignment platform founded upon the Risk Number®.
Junxure, the industry leading CRM solution and technology company for financial advisors, this week announced new enhancements to its cloud-based CRM platform, Junxure Cloud®. As part of its ongoing work to integrate with leading platforms serving advisors, Junxure Cloud has partnered with Riskalyze, the industry-leading risk alignment platform and inventor of the Risk Number®, to integrate the two popular systems.
I’m thrilled to announce that, starting today, you can use LastPass on any device, anywhere, for free. No matter where you need your passwords – on your desktop, laptop, tablet, or phone – you can rely on LastPass to sync them for you, for free.
After an amazing tour of duty, Adam Nash is handing the baton back to me [Andy Rachleff]. While Nash will be transitioning out of an operating role at the company, he will continue to play a strategic role as a member of our Board of Directors.
FOLIOfn, Inc. announced today that it has acquired First Affirmative Financial Network, one of the nation’s most prominent registered investment advisor firms specializing in sustainable, responsible, impact (SRI) investing.
Digital wealth management technology provider Invessence announced today that it has partnered with PrairieSmarts, an innovative risk analytics firm, to provide risk assessment tools for financial advisors and their clients. Enhancing Invessence’s comprehensive digital wealth platform, the robust risk tools from PrairieSmarts will assist advisors in calculating, documenting and managing the alignment of a client’s risk profile with a compliant portfolio recommendation.
Riskalzye co-founder and CEO Aaron Klein talks about raising $20 million from FTV Capital and what financial advisers should expect as a result of the transaction.
On today’s broadcast, Riskalyze announces its new Check-Ins feature, eMoney Advisor shows off its new client experience, Fidelity offers a preview of its new Wealthscape™ platform, and TD Ameritrade Institutional tells me when you can expect Veo One.
Today’s episode is brought to you by eMoney Advisor, providers of a leading ADVISOR-CENTRIC wealth-planning portal.
eMoney just introduced an enhanced client experience, incorporating many of the features investors find most compelling about digital advice platforms – like automation, intuitive design, ease-of-use, and more, helping you deliver an unmatched client experience. For more information on eMoney’s brand new client portal, visit fppad.com/emoneyadvisor
[Last week I attended the T3 conference in Ft. Lauderdale, and I made three vlogs that you should watch, so let me give you the rundown of what I think were the best stories from the event.
Leading off is Riskalyze, as CEO Aaron Klein introduced a feature called Check-ins, which allows you to gauge your client’s sentiment of the markets with a pretty unobtrusive email. Clients answer two simple questions in a few seconds which helps you quickly identify those who have growing concerns about their financial future. Here’s Aaron Klein on availability and pricing:
Klein: Check-Ins are going to arrive in May, and we haven’t set pricing for them yet, but I can tell you it’s going to be a free upgrade for all of our existing customers.] Riskalyze, the company that has equipped thousands of advisors with the Risk Number™, today announced powerful new tools that revolutionize the ability of advisors to put the markets in context for their clients during client reviews, support client psychology between those reviews, and deliver consistent behavioral coaching that promotes long-term investing.
[Another top update comes from eMoney, as Drew DiMarino took the stage to show off the updated client experience, giving a preview of the new look, showing how goals are tracked in the platform, and highlighted client collaboration features that help clients remember what tasks they should complete to meet their goals. The update is coming in March, and here’s Drew DiMarino on what you can expect:
DiMarino: The new client experience is much more personal in nature, the client can actually add images of their family, set goals with those images tied to those goals, a much more customizable experience for the end client.] At the T3 Advisor conference in Fort Lauderdale, Florida today, eMoney Advisor (“eMoney”), a leading provider of wealth-planning technology for financial professionals, will unveil its enhanced client experience.
[And finishing my rundown is Fidelity, as the custodian revealed plans to offer Wealthscape™, Fidelity’s Total Advisor Platform that combines portfolio management, rebalancing, proposals, and fee billing with the features and functionality of the eMoney wealth portal. I caught up with Tom McCarthy, senior vice president for product development at Fidelity for a few more details.
McCarthy: So we’ve taken a hard look at the marketplace, talking to our clients, and looking at a lot of research, so Fidelity’s response to help them grow their business is the Fidelity Total Advisor Platform. The primary pieces of that are a deep integration with our new acquisition of eMoney, bringing planning to action, as well as a full suite of integrated portfolio tools wrapped in very advanced workflows.
The platform is expected to roll out at the end of 2016 with Fidelity-only data, and support for multi-custodial data is anticipated sometime in 2017.] In the escalating battle for control of the technology hub used by registered investment advisors, Fidelity Investments has a new weapon that may turn the tides.
[Now the week before T3 I went to the TD Ameritrade Institutional National LINC conference, and I made more videos you should watch, but the biggest takeaway for me was clarification on when to expect the rollout of the Veo One dashboard.
I sat down with Chris Valleley to better understand the timeline when Veo One will be released.
[Winterberg]: So I need to be more clear that it’s not one release date, it’s all official, and it’s all done, but it’s rather graduated and it’s going to be progressive. [Valleley]: That’s right, it won’t be a big bang rollout, it will be an iterative approach, and we’ll find the advisors with the right integrations at the right time and then onboard them into Veo One.
So, fair enough, you’re going to have to be patient for the release of Veo One, just like you’re going to need to wait and see how Fidelity’s Wealthscape evolves, too.
Fortunately, Veo Open Access now supports over 100 integrated solution providers, which means that you have options you can buy and implement today without waiting to see what the custodians promise to offer in the future.] Veo One, TD Ameritrade Institutional’s next-generation advisor technology platform, will give advisors access to all of the CRM, financial planning, portfolio management and other systems they use from one desktop.
Now if you’ll excuse me, I have quite a bit of laundry to do from our trips, so for FPPad.com, I’m Bill Winterberg, see you next time!
Here are the video playlists we published from TD Ameritrade Institutional National LINC and T3:
2016 TD Ameritrade Institutional National LINC
2016 T3 Advisor
Here are stories that didn’t make this week’s broadcast:
United Capital, the Newport Beach, Calif.-based firm, is acquiring FlexScore, a consumer-facing financial planning tool that aggregates users financial data to generate a credit-score-like number of a person’s financial health.
I met with Aaron Klein, CEO of Riskalyze, between sessions at T3 Enterprise 2015 to dive into the details of what he discussed during his general session presentation at the conference.
During his session, Klein identified that 52% of 20-29 year olds do not identify themselves as aggressive investors, which is in stark contrast to the assumption that the majority of younger investors generally have a higher tolerance for investment risk, as they have many more years to recover from short-term volatility. But it is these clients who sell at exactly the wrong time because they are invested too aggressively relative to their personal risk tolerance.
At T3 Enterprise 2015, Klein introduced the The Real-Time Wealth Management Enterprise platform, which can be deployed by financial enterprises in under 75 days. The Real-Time Wealth Management Enterprise™ is a combination of Riskalyze, Autopilot, and Compliance Cloud for large firms & RIAs.
The Real-Time Wealth Management Enterprise platform, according the Klein, allows enterprises to perform real fiduciary reviews for accounts large and small.
