When advisers at wirehouses or independent broker-dealers look to launch their own firm, the main question on their minds is, “How will I recreate the products and services I’ve always offered my clients throughout my career, as an employee of my current firm?”
As they start to think through their technology stack, we advise them to choose a custodian first and a reporting provider second. The reporting provider will act as the “hub” through which all data flow across the rest of a registered investment adviser's back-office infrastructure.
For advisers moving to the RIA channel, reporting technology offers the first chance to provide clients with a holistic picture of their total net worth, including assets held outside of the adviser’s purview.
Custodial statements provide account owners with balances and transaction history. These statements are broken down by account number and act as an efficient way for clients to verify, through a third party, the assets they have invested under the RIA’s purview.
These statements do not, however, provide any performance numbers at the account, household, asset class or security level. The custodial statements provide no commentary on the direction of the markets or the specific investment strategy the client is invested in.
If the adviser wants to paint a picture of the client’s financial standing, he or she will need to utilize performance reporting software. With this technology, advisers can create customized and dynamic reports, usually through a drag-and-drop interface, to group accounts within the household in the most logical way for the client to understand.
Reporting provider technology also includes a client portal and a billing module, both essential components of an RIA’s business. Because this technology is so essential to an RIA’s infrastructure, here are four industry-leading reporting solutions for RIAs.
Advisers looking to move to the independent channel would be well-advised to learn more about these technology solutions, as they act as the engines that drive RIA business across the country (and globe).
Matt Sonnen is founder and CEO of PFI Advisors, an operations and technology consulting firm for RIAs, which recently published a report, “The Importance of Reporting Provider Technology for RIAs.” Follow him on Twitter @mattsonnen_pfi.
The firm's CFO and EVP of Wealth Management Solutions are the latest executives to exit the broker-dealer.
Clients are saying they would consider switching advisors if another professional offered estate planning services, according to a new Trust & Will survey.
CEO Laurel Taylor says the fintech's composable AI stack helps workers optimize dollars across Trump Accounts, 529s, 401(k)s, and other employee benefits.
The bank has swiped three private banking veterans from BNY as the city climbs the ranks of America's fastest-growing wealth hubs.
Employee accounts, crypto trials and job cuts frame a pivotal year for the Swiss lender.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
