Fintech

Brinker Capital unwraps tablet allocation app

To reach younger investors and solve a common investment problem in one technological shot, investment management firm Brinker…

To reach younger investors and solve a common investment problem in one technological shot, investment management firm Brinker Capital Inc. has come up with a free tablet application that calculates relative returns versus absolute returns.
Although it sounds like an exotic cocktail, Brinker’s Absolute Return Mixer app provides financial advisers with a simple way to calculate the optimal mix of relative-return and absolute-return strategies for each client’s portfolio.
“It’s not exactly Angry Birds, but it’s fun,” said Brinker president John Coyne, referring to the wildly popular smartphone game.
Once downloaded, the app leads advisers through a series of eight questions regarding the client’s investing time horizon, risk tolerance and investing future, generating a range of recommended absolute- and relative-return allocations. It’s available in Apple’s App Store and in the Android Market.
When asked whether he expects advisers to suggest that their clients also download it, Mr. Coyne said that he isn’t sure.
“I’d love nothing better than to have the Smith Barney advisers of the world say [to their clients], ‘Hey, take a look at this. I want to talk to you about it in Friday’s meeting,’” Mr. Coyne said.
Coming up with the app in the first place had a lot to do with creating ways to better communicate with younger investors, including Generation X and Y prospects, he said.
“We want Brinker to be a multigenerational firm, so we have actively embraced social media and technology in order to adapt to the future and provide additional ways of communicating,” Mr. Coyne said.
The app is the second mobile-device program of a planned series. A mobile-browser optimized version of Brinker’s website was launched in 2010.

A bit of background on the application

I always have questions on the origins of these applications and how they end up getting built.
It turns out that Brinker came up with the design and methodology for the application internally.
Sean Forcine, an interactive media specialist at Brinker oversaw a lot of the design and collaborated with Andy Rosenberger, an investment manager and CFA at Brinker, who came up with the calculations.
The whole thing was then fully fleshed out, coded and implemented with the help of third-party interactive web design firm Mosaic Interactive.
“We started the discussions that led to the app last summer and the design phase got underway in November when we engaged with Mosaic,” said Mr. Forcine
“We really came up with the whole dial theme ourselves and had a couple of different ideas in terms of dials and meters that we experimented with,” he added.
He explained that the firm stared with a focus group of about 25 that was later supplemented with 30 advisers who piloted the app and provided feedback.
Here is an overview of the app that Brinker provided me with that summarizes things pretty well in text.
Step 1: Indicate client’s overall investment outlook
Users will be prompted to select their overall investment outlook from a list of seven descriptors ranging from defensive to aggressive equity. Clicking on any of the seven wheels on the investment outlook continuum will elicit descriptions of each, allowing advisers to select that which most closely matches their clients’ outlook. Once completed, the screen transitions to Step 2.

Step 2: Risk tolerance
The next phase requires answers to seven questions spanning risk tolerance (three questions with 10 possible answers); future purchasing power (two questions with seven possible answers); and time horizon (two questions with eight possible answers).
As each answer is provided, a tri-colored wheel to the left of the questions will spin, settling on the appropriate allocation elicited by the user’s responses. A bar at the bottom of the screen will move left (absolute return) and right (relative return) to indicate the proposed allocation scale. Users can also click on the wheel to fine-tune its position, resulting in an even more precise ratio.

Step 3: Final step
The screen then transitions to the final step, the investor’s proposed allocation to absolute return vs. relative return. This recommendation is presented as a percentage range for each strategy.
The results cannot be saved or printed, unless you are a Brinker Capital adviser. They will be able both to receive a PDF of the recommendation and/or email it to themselves or a client directly from an iPad or Android tablet. Non-Brinker Capital advisers can complete an approval process to request a PDF of the results.

The Absolute Return Mixer is available for free download in Apple’s App Store and in the Android Market.