If you are starting a new RIA firm and you are in the market for a custodian, your initial search results will likely include the large, established firms that already command a substantial following among independent RIAs: Schwab, Fidelity, TD Ameritrade and Pershing. If you are breaking away from a wirehouse or transitioning from an independent B/D model and you are bringing substantial assets with you, or if you have a credible plan to bring in substantial assets in a relatively short period of time, those big firms will no doubt welcome you with open arms. But if you are new and unproven, or if you plan to grow at a more leisurely pace, you may find the four major custodians less enthusiastic about providing service to you and your new firm.

There are other credible options out there for new entrants into the field or those looking to move from one custodian to another. They include firms such as LPL, Scottrade, Shareholder Service Group and Trust Company of America. One firm that's rarely been included in the conversation in the past, but which we can expect to hear much more from in the future, is Trade PMR.

Although this firm is not as well-known as many of its competitors, it's not new. Trade PMR opened its doors in 1998. Its sole purpose was, and is, to service RIAs. Today, the firm is well-equipped to handle the needs of fee-only independent RIAs, but it is equally suited to the needs of dually registered ones-those that charge both commissions and fees. In recent years, Trade PMR has experienced rapid growth. At the beginning of 2009, the firm serviced approximately 300 advisors. During its recent annual conference, the company announced that it is now servicing 563 advisors, and that it has a significant number of additional prospects in the pipeline.

It is highly likely that the firm's recent growth is at least partially attributable to its enhanced technological prowess. In 2008, Trade PMR launched eCustody, its Web-based advisor platform. Since that time, the firm has continued to improve eCustody to keep it on the leading edge of Web-based custodial technology platforms. Another factor in the firm's growth is no doubt its willingness to work with breakaway brokers and RIA startups without imposing any minimum AUM or minimum fee requirements.

The Trade PMR Approach to Technology
The company has recently added a basic integrated client relationship management (CRM) application, paperless account openings, account aggregation and enhanced portfolio reporting to its eCustody platform, which gives Trade PMR advisors access to a comprehensive, state-of-the-art, Web-based workstation. In addition to these capabilities, the eCustody workstation offers account management, research, model trading, block trading, reports, fee processing, market news and more.

My recent conversations with Trade PMR Chief Technology Officer Dennis R. Suppe and Executive Vice President Frederick A. Van Den Abbeel led me to conclude that the company understands the value of advisor technology as well as the value of an integrated advisor workstation. Despite their strong belief in technology and integration, Trade PMR does not impose its business model on its advisors. Rather, through education and aggressive pricing, the firm seeks to make such a compelling argument for its offering that advisors will find it hard to resist. The approach seems to be working.

In essence, Trade PMR is seeking to provide a two-pronged eCustody model. At the core, it wants to provide a highly evolved back-office solution wedded to a strong front end that includes integrated applications such as basic CRM and portfolio management and reporting. For those who prefer an alternative portfolio management solution or a more robust CRM application, Trade PMR will integrate with third-party providers. Before we stray into the third-party applications, let's take a quick look at the core eCustody capabilities

Core eCustody Capabilities
Trade PMR's new, improved paperless account-opening system is impressive. An application wizard guides the advisors through the account-opening process. The wizard starts by requesting a client name and e-mail address. The advisor then selects the type of account to be opened. After you check the features you want the account to have (margin, transfer, etc.) the wizard tells you what is required to open the account. When you enter the necessary information, the wizard presents multiple options to verify the identity of the account holder.

If the client is in the office, you can print these forms and have him sign them, but this is the least desirable method. The better way is to use the proprietary identity verification the company offers through Equifax. Here, the clients answer a number of "out of wallet" questions from their credit report. This might include questions like "Who held the mortgage on the house you sold three years ago?" or "What is your current monthly car lease payment?" These questions can be answered by the client if he or she is in your office, or the client can be notified by e-mail to log on and perform the verification.

Once the client is verified, the answers are like an official signature. The completed document is stored in an unalterable format on eCustody. Both the client and the advisor can download and store paper copies if they wish to do so. As soon as the identity is verified, eCustody opens the account and supplies the advisor with the new account number.

The recently launched eCustody 2.0 sports numerous upgrades and additions. One is the new, integrated CRM module. According to Suppe, this is not designed to compete with more robust third-party systems such as Redtail and Junxure. It was initially intended for the many advisors who do not currently own a CRM application. It is also intended to serve as a data hub that can share information with other Trade PMR applications.

Since the CRM application is built on Microsoft's Silverlight technology, it can offer a rich user interface accessible from multiple browsers and multiple operating systems. It is also very responsive, allowing advisors to open multiple tabs within the application so they can rapidly tab back and forth between views when necessary.

To get existing Trade PMR clients started on the CRM system, the company uses a proprietary applet to automatically create a contact for each person with an account linked to an advisor. It does this by matching Social Security numbers to avoid creating duplicate contacts. If an advisor does not want to create a contact for an account holder, she can easily delete individual contacts or multiple contacts.

Using tags, advisors can assign multiple keywords to a contact, tags that can later be searched. For example, by creating a "prospects" tag for all potential clients, advisors can later run a search for them under that tag in the database. If an advisor tags some contacts as, say, both clients and 401(k) account holders, the advisor can later search for all clients with 401(k) accounts using those terms.

The accounts tab allows advisors to link individual accounts to a client. If the client does not exist in the CRM database, the advisor can easily create one. Advisors can manually delink accounts if desired. In the case of joint accounts, the system will right now only automatically link to the primary account holder's contact record. However, the advisor is free to link an account to all account holders. In the future, Trade PMR intends to offer an option allowing advisors to automatically link jointly held accounts to all contact records.

Smart technology also helps advisors create households. When you do, the system will automatically suggest that you add people with the same last name and same address to it (an option you can reject if you like). Advisors can accept or reject these suggestions. Once a household is created, you can track histories for it, just as you would for an individual. You can also create a primary address and phone number for the household, as well as track notes at the household level.

Once the groups, households and client and account links are in place, advisors can search by account, client, household, group of accounts or group of clients. Your ability to group data in all of these formats comes in handy both when you're creating various CRM reports and when you're using the integrated portfolio management and reporting application.

Trade PMR offers its own proprietary portfolio management and reporting package. While it does not offer all the bells and whistles of more expensive packages, it does look to be sufficient for most of those advisors who custody their assets exclusively with Trade PMR. Since the application does not currently accept data from other custodians, those advisors with multiple custodian relationships will have to use a third-party provider's software. Trade PMR currently supports Morningstar Office, Orion and EZ Data.

Trade PMR's platform offers account aggregation with Advisor Exchange LLC, powered by CashEdge. This service gives advisors access to the positions and balances of held away assets, as well as information about client liabilities so that the advisors get a full picture of their clients' financial positions.

Trade PMR also provides online access to all important client paperwork including account applications, transfer forms, trade confirmations, statements and 1099 forms.

With the exception of the account aggregation and performance reporting, everything on the platform, including the integrated CRM application, is offered at no additional charge. Account aggregation costs $150 per month and performance reporting costs $99 per month. Each of these services is a bargain considering what you get for the money, and to entice advisors, Trade PMR is offering both applications for the bundled price of just $180-an incredible value.

Electronic fee billing is also included. Advisors can create simple or complex fee schedules and apply them to all accounts or to individual accounts. At the beginning or end of a billing cycle, (according to his or her Form ADV) the advisor simply goes online and tells Trade PMR to apply the schedule. If there is sufficient cash in all accounts to process the bills, the transactions will be processed.
If not, the system will warn the advisor to raise cash in the appropriate accounts. For bills processed before 2:00 p.m. Eastern Standard Time, the advisor's account is credited the next day. If an advisor's ADV requires client notification of the bill payment, Trade PMR can send e-mail notifications to the client or create PDF letters for the advisor to mail out. Copies of this correspondence are automatically stored in the Trade PMR CRM system.

For those who require a more robust CRM system, Trade PMR offers some level of integration with Redtail. Ideally, the firm will eventually offer real-time or near-real-time synchronization between the Redtail and Trade PMR Web sites. In the financial planning software area, Trade PMR offers integration with FinanceLogix, and the company is negotiating to have its platform work with MoneyGuidePro as well.

Although eCustody 2.0 is quite impressive, a few things are lacking. Right now, you cannot upload documents and link them to a client record, but we expect that capability before the end of 2010. Also in the plans for 2010: basic rebalancing capabilities. Online fixed-income trading is also expected this year. The integrated CRM lacks work-flow capabilities, but basic work-flows are due before year's end. Also by that time, the platform will enable advisors to automatically schedule follow-ups to a task. Some services routinely offered by other custodians such as e-prospectuses and e-proxies are not yet offered, but I suspect these too will be coming soon.

Overall, there is a great deal to like here, especially for newer, smaller RIA firms. Clearly, Trade PMR is focused on providing good technology and tight integration while keeping costs low. Its eCustody platform sports a state-of-the-art interface with strong capabilities. For an RIA that custodies exclusively with Trade PMR, the total package, all integrated together for $180 per month, represents a truly enticing value.

New RIA firms, or those unsatisfied with their current custodian would be well advised to further investigate Trade PMR. You can visit the company's Web site, www.tradepmr.com, to learn more.