TD Ameritrade launches tech initiative, moves toward completely open architecture

Veo platform will be able to share data with many third-party technology vendors

Jul 30, 2010 @ 2:25 pm

By Davis D. Janowski

If carried to fruition, TD Ameritrade Institutional's latest technology initiative will be the first to open its application program interface completely to third-party technology firms able to pass muster during the custodian's security review of their systems.

That review is already under way and is expected to take four to six additional weeks of testing.

In very simplified terms, access to the company's API will allow external programs to query TD Ameritrade's systems seamlessly for data needed by them —for example, an adviser needing a client's latest real-time holdings for a portfolio management program.

In a meeting Thursday with InvestmentNews, TD Ameritrade Institutional president and chief executive Tom Bradley, managing director Zohar Swaine and technology product management director Jon Patullo said that it is too soon to comment on which vendors are likely to be granted access to the API.

The current security testing follows a closed-door technology summit held in March between TD Ameritrade and many of the industry's independent advisory technology vendors.

Mr. Bradley said that the initiative's main objective is to attract new advisers.

“We see this as a way to provide those breaking away from the wirehouses or going independent with the largest number of choices in terms of technology,” said Mr. Bradley, adding that other custodians have made the mistake of limiting their offerings to a select few vendors.

The next reason for the technology initiative, according to Mr. Bradley, is to keep its more than 4,000 advisers happy.

“They don't want to be restricted in what technology they can use, or have to give up something they are already invested in,” he said.

This initiative also gives TD Ameritrade the opportunity to regain some of its past glory as a leader in technology integration; the company was among the first providers of an integrated trading and account management system in 2000.

A race is on between custodians that hope to attract advisers by offering them the best suite of technology offerings.

The Charles Schwab Corp. officially assigned a name to its own technology initiative late last month, now called Schwab Intelligent Integration. Schwab is assessing the popularity of applications used by its advisers prior to undertaking integrations.

The platform to beat, at least in terms of popular perception among analysts, industry experts and many advisers is from Pershing LLC. Its NetX360 platform offers a high level of integration to both fee- and commission-based advisers, though even its systems are not presently integrated with third-party vendors to the level TD Ameritrade is envisioning.

When asked if their initiative was launched in answer to Schwab's recent announcements, Mr. Bradley was adamant that his company had been involved in its planning for months, and cited the technology summit held in March as evidence of this.

Relating to the depth of the integrations, Mr. Swaine pointed out that the goal was full, secure access to the company's platform.

“As long as their systems are secure, we want providers to have access to every field of data they need,” he said.

As for the system, a specific example of level-four access illustrates the two-way flow of data between TD Ameritrade's Veo platform acting as a hub and in turn delivering client or account information to a downstream system — say, a customer relationship management, portfolio management or financial planning program — and in turn being able to pull in data from an external one seamlessly.

Other examples of how an adviser could use the new system includes being able to pass household data between applications, create or submit management fee files from one application and being able to view real-time data for accounts and balances positions in a third-party application.

While the initial round of up to a dozen vendors will be announced in the fall of this year, others will likely be added in 2011.

When asked about its plans to accommodate hybrid advisers with technology, Mr. Swaine said that TD Ameritrade has a working relationship with 10 broker-dealers but is planning to work toward deeper levels of technology integration with a subset of them.

Other initiatives discussed during the meeting included launch of a Veo application for the Apple iPad either this year or early 2011 as well as integration of futures trading and the addition of other smart-phone applications for the Veo platform.

Related stories:

Schwab releases more details about new advisory tech platform

Fidelity, Pershing, Schwab, TD in a tech 'arms race'

Will Pershing's NetX360 live up to its promise of full integration?

Fidelity to spend $50M on platform for advisers

0
Comments

What do you think?

View comments

Recommended for you

RIA Data Center

Use InvestmentNews' RIA Data Center to filter and find key information on over 1,400 fee-only registered investment advisory firms.

Rank RIAs by

Upcoming Event

Jul 09

Conference

Boston Women Adviser Summit

The InvestmentNews Women Adviser Summit, a one-day workshop now held in six cities due to popular demand, is uniquely designed for the sophisticated female adviser who wants to take her personal and professional self to the next level.... Learn more

Featured video

INTV

Why advisers are pessimistic about the economy

Deputy editor Bob Hordt and senior research analyst Matt Sirinides discuss a recent InvestmentNews survey of advisers, most of whom see a recession ahead before the next presidential election.

Video Spotlight

We started as a boutique firm with huge ambitions. Schwab was a perfect fit.

Sponsored by Schwab: Advisor Services

Recommended Video

Keys to a successful deal

Latest news & opinion

Here's how advisory firms compensate their employees

Schwab’s report on RIA pay details median compensation for a range of positions

Raymond James buys Silver Lane Advisors, an investment bank for RIA mergers

Expanding unit taps into M&A trends in the wealth management space.

Final pass-through rules deliver good and bad news for advisers

The final regs are a boon to rental-property owners and some mutual fund shareholders, but some clients' deduction may be diluted.

Finra focuses exam priorities on investor-protection threats

Online distribution of private placements pops up; exchange-traded products cause suitability worries.

10 public companies that boosted their ESG ratings in 2018

These 10 companies increased their environmental, social and governance scores last year.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print