Revolutionizing The Advisor’s Tech Stack

Advisors Can Leverage UMAs, APIs And Data Feeds To Free Time And Improve Their Businesses
Aaron Wormus, Chief Technology Officer, SMArtX Advisory Solutions
Aaron Wormus, Chief Technology Officer, SMArtX Advisory Solutions

Advisory firms of all sizes are weathering a storm wreaking havoc on their day-to-day operations, productivity and ultimately, the enjoyability of their work: Toil.

As defined by Google’s engineering team nearly two decades ago, toil eliminates the necessity of critical thinking or creativity from work. It completely removes human judgment and expression altogether.

Unfortunately, we’ve encountered too many advisors who toil their day away. They start their mornings by firing up their legacy tech stack, bouncing between multiple browser windows and running processes in Excel, all while wondering if there’s a better way to leverage the ever-evolving, expensive technology platform they invested in to scale their business.

That time spent wrangling tech platforms fits the definition of toil to a tee.

But if our collective goal as an industry is to help advisors eliminate toil and channel their energies into best serving clients and building their businesses, then we need to look at business operations as a whole. And, if you ask me, advisors will see the most impact by exploring innovative workflows at the intersection of modern investment vehicles and technology.

Taming Toil: Tap Into The Power Of Managed Accounts

Advisors should want to have their assets primarily in professionally managed models.

That’s a bold statement – I know. But there’s a reason unified managed accounts (UMAs) grew 34% in just three years and amassed more than 22% of managed account assets by 2022. The benefits are simply too compelling.

By combining third-party strategies, individual securities and internal portfolios in a single account with multiple sleeves, UMAs empower advisors to consolidate investment accounts into a single managed account. This simplifies the administration involved in managing investments and makes it easier to customize according to individuals’ investment goals and risk tolerances. It also makes it easier to diversify across a range of asset classes, possibly reducing risk and potentially improving portfolio stability and performance.

UMAs empower advisors to consolidate investment accounts into a single managed account.

Imagine going from managing individual stocks in disparate tools to consolidating the whole process in one sleeve in an actively managed UMA structure that meets clients’ unique investment objectives.

However, most firms are not leveraging models for the majority of their assets. That means there is a significant opportunity to provide a more holistic approach to money management, reduce administrative burden, streamline billing and simplify the investment management process. The goal? Make operations smoother, improve the client experience, reduce costs and allow more time for client relationships.

The truth is that UMAs are an incredibly valuable investment vehicle. But they’re even more powerful when your technology is configured to optimize workflows. Leveraging a platform with cloud-first APIs and modular configurability that pushes data from disparate sources to you automatically eliminates your toil.

Build A Tech-Forward Practice With APIs And Data Feeds

On their own, UMAs are effective investment vehicles that allow advisors to leverage professional portfolio managers and streamline investment management through powerful tools. But with an API-first mentality, you can level up your use of UMAs to build a future-forward firm that will set you apart from the competition.

APIs should be central to any modern advisors’ tech stack.

APIs should be central to any modern advisors’ tech stack. But unlike other technology providers who would have you believe APIs are a magic bullet to cost savings and operational efficiency, we believe an investment in APIs should effectively address the demands of modern markets by optimizing business systems in relevant, modern and affordable ways.

APIs should empower you to:

Streamline data-driven decision-making. APIs’ power lies in helping disparate systems connect and pass information back and forth. This enables advisors and firm leaders to combine the best of every platform they use into one view without needing to overhaul their complete tech stack.

Operationalize workflows and achieve efficiency. Modern advisors differentiate their services by providing white-glove client service and custom advice. And the only way to do so at scale is to automate workflows and gain time back in the day.

Deliver a modern client experience. Clients today don’t want a modern experience. They demand it. As advisors prepare for the Great Wealth Transfer and the average client age begins to skew younger, a contemporary digital experience will be key to retaining and attracting new clients. Firms can use APIs to surface relevant information for clients when needed.

Create a foundation for growth. As UMAs continue to grow in popularity, marrying managed account technology with APIs to create modular integration will be key to building your practice around modern solutions that set your business up for sustainable growth.

The Foundation Of Managed Account Innovation

UMAs and APIs were both born in the digital-first age – it only makes sense they work together seamlessly.

By combining the benefits of UMA structures and the opportunity to connect through innovation, some providers in this space are set to redefine the fintech landscape. They’re committed to radically reimagining managed account technology to deliver a modular platform that makes investment management simple and scalable.

You should look for a managed account platform that is a modern solution for firms looking to tap into capabilities like custom direct indexing, tax transition management and products like structured notes. Starting with the onboarding process, such platforms empower customers to start with an out-of-the-box integration that requires no technology infrastructure on the integrator side.

This makes the data migration process simpler than ever, as advisors have the power to access data quickly and seamlessly. Built on a flexible architecture and with performance in mind, platforms exist that offer superior power and scalability as a one-stop shop for your investment management processes.

When you make the commitment to invest in a technology strategy and partner that embraces APIs and keeps pace beside you, you unlock the ability to accelerate growth. And tame the toil that might be keeping you from achieving your goals.

Aaron Wormus is the Chief Technology Officer at SMArtX Advisory Solutions.

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