What's Up in Wealth Management Technology

Customer Value Management
Fincentric, the Vancouver, BC.-based provider of iWealthview, a comprehensive wealth management software, analyzes the current and potential value of customer relationships. "The system looks at potential profitability and how do I treat that customer. Do I give that customer an advisor or not," explains Mike Cardiff, president and CEO. "You identify your customer, are they platinum or gold, what is their lifetime profit with the financial services institution."

Enterprise-Wide Consistency
A wealth management platform "ensures enterprise-wide consistency," says Ashish Arora, senior vice president, product marketing for Advisor Software Inc. "The number one concern that firms like Merrill Lynch, Paine Webber and Prudential is not to be sued." With a three-tiered layer, including a client layer, ASI's platform offers "the advisor layer--which looks at the book of accounts, and the enterprise layer to put in their model portfolios, risk questionnaires and asset allocation models-- making sure the advice has the consistency across the advisor base."

Outsourcing
State Street, the giant global custodian, launched an outsourcing business for the wealth management market, to function as a utility. Anne Tangen who heads the business, noticed that as institutional clients were expanding their service to handle this wealth management market, they were looking for more robust tools and infrastructure. "What we did is combine all the activities--securities processing, settlement, trust accounting, performance reporting. We private label the entire service. It's a middle office and a back office in a box," says Tangen, who is senior vice president and division head, wealth manager services, which has been building a best-of-breed platform that includes ByAllAccounts, as a data gathering tool for advisors that want a holistic picture.

Second-Generation Account-Aggregation
Forget screen scraping, the buzz word for scrubbing account data off of Web sites, as practiced by Yodlee and CashEdge. New Player ByAllAcounts has a normalized database around aggregated data that can get investment quality data from 1200 financial insitutions, comments Mark Lowe, practice director of North America Investment Solutions for Unisys Corp. which considers it a partner for its wealth management solution. "Our other partners can use that data and then do portfolio analysis," he says. According to CEO Pat Gardner, ByAllAccounts can run the data through analytics on its WebPortfolio platform which also has built interfaces to the data feeds. Meanwhile, Advent Trusted Network is gaining traction because it receives systems of record data from 20 to 30 financial institutions. "We're not scraping, we're actually extracting the data from the account covered in the agreement," says Charles Record, vice president, business development, who notes that Advent has established a number of alliances with providers of applications to accessATN data, though he didn't cite any by name. "It's showing that people who went off and built an application. and said we'll get data another way, (have) begun to realize you can't substitute breadth of information from a bunch of institutions, for the deep data that is required."

Separate Accounts
Watching a lot of people who fall into the mass affluent category migrating to separate ac counts, Morningstar, the Chicago-based provider of investment selection and planning software, plans to add a separate accounts database this fall. "As that becomes popular, it's going to be important that we're not only recommending mutual funds, we may also be recommending separate accounts," says Geoff Balzano, product manager for Morningstar's Advisor workstation which works with Goal Planner, a 10-step process for investment planning launched in December.

Web Services
Advisors are opening up applications and data to investors utilizing private-labeled-hosted Web applications that allow investors to collaborate with advisors. Advent Software created Wealthline in partnership with Microsoft's MSN Money site to deeply integrate MSN content with their holdings in Axys Office suite of products used by advisors. Two sections within Wealthline are integrated with Axys professional data: a stock tracker section with 20-minute delayed quotes, news, unrealized gain information and charting, is tied to the holdings managed by the advisor and other portfolios that the manager is tracking through ATN. Advent's secure publishing platform--which handles a variety of document formats such as HTML, Word, Excel and PDF and is used by advisors-- was integrated into Wealthline so that advisors can automate the generation and uploading of reports to the site. Advisors can also push up reports on an adhoc basis. "If the advisor is talking to the investor on the phone, the advisor might run a report and then publish it that single report What's next? INX aplications that allow a firm to build applications that receive information in real-time from Axys . "You'll see this type of application employed in the future in Wealthline," says Advent Software's Record.

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What's New? Collaborative Wealth Management

In the future, the ability to create online collaboration between the client, the advisor and other interested parties, will be the type of capabilities that will differentiate firms, contends Scient consultants.

To demo the concept, Scient built a collaborative wealth management solution by integrating various tools for whiteboard sessions, chat, integrated voice response (Aspect Communications), with alerting and real-time notification (Adhoc Technologies). It used a document collaboration tool (imanage) to build a cockpit for the wealth manager to put all the information an advisor requires about his clients and their portfolios. "If you're interested in Microsoft, I'll just pull down a PDF file and send it to you right away," says Jay Norman, global managing partner, Scient's Financial Services Practice Group. "Each of these people can make contact today, but it's not real time and that costs more money," says Norman, who contends that firms should fit the client relationship into a cost model that's suited to today's choppy markets. For instance if an advisor is developing trust services plan, he can make changes offline and send them back off to the client with an alert to review them.

At the self-service end of the scale, Scient built an artificial intelligence bot- (with a tool from Artificial Life) that can answer natural language questions and push the client to different pages on the Web site. In the background, the bot is collecting information about the types of questions that are asked and who's asking them, says David M. Welch, client partner and managing director of wealth management soutions for Scient's Financial Services Business unit.

For a more affluent client, that wants to create an estate plan, the advisor could use a chat and a whiteboard session to develop an initial version so that both client and advisor can be online simultaneously and involve other interested parties, such as a lawyer and a tax planner, to simply and speed up the process. Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio