Over the last several years there has been a proliferation of digital wealth management platforms for advisors, so it is difficult to stand out in the crowd. But RobustWealth looks like it may soon have what it takes to compete in what has become a crowded segment.

The firm’s founder and CEO Mike Kerins has impressive investment credentials. Before he was at RobustWealth, he spent eight years at Franklin Templeton, where he managed an investment team overseeing a global portfolio of assets equaling $40 billion. He also served as head of asset class research and has expertise spanning strategic and tactical asset allocation, portfolio construction, target-date strategies and liquid alternatives. Kerins is a CFA charter holder as well as a certified financial risk manager. Clearly, he understands the investment side of the business.

Initially, he thought RobustWealth would distinguish itself on its investment capabilities, but he came to realize that providing an integrated, easy-to-use technology platform was equally important. My initial introduction to RobustWealth suggests that it offers both.

RobustWealth is a private-label wealth management platform for advisors. It offers simple yet sophisticated portfolio construction tools, automated trading and rebalancing, a powerful yet simple billing module, the ability to provide tactical asset allocation, a nice advisor dashboard and a client portal. These capabilities allow advisors to offer a private label robo-advisor to their clients if they want to, but even if they don’t, the platform can still automate their traditional business.

The platform can work with multiple custodians. It is currently fully operational with TD Ameritrade, it’s in the testing phase with Fidelity, and it’s close to reaching an agreement with at least one other company. RobustWealth is also in the process of vetting one or more account aggregation providers to bring in assets held away.

Once logged in, an advisor can get an overview of the whole business. From there, the advisor can view a list of clients. When he or she selects one, the extensive client view is revealed.

RobustWealth bills itself as a “goal-based” system, but it’s not in the traditional sense. It is primarily investment driven. You can link one or more accounts to a goal. When you do, the goal or goals show up on the client page. For example, if the client’s only goal is retirement, that’s what you will see as the goal. Among other things, you will see the AUM and cash devoted to the goal; a target-date for the goal, if applicable; an investment framework for the goal, if applicable; and the model applied to the goal, if applicable. You can also see the log-in count for the client portal, so you know how often and how recently the client last checked on the portfolio.

The platform offers two methods for advisors to manage assets applied to a goal. The first one, which is the typical approach for most advisors, is to create a model asset allocation and apply that asset allocation model across multiple accounts or goals. RobustWealth will then execute all of the trades and rebalance opportunistically as needed.

The more sophisticated option is to assign an investment framework to a goal. You can think of an investment framework as something like a private target-date fund for the client. You can create your own glide paths for various dates in the future (for example, a 2025 glide path, a 2035 glide path, etc.), or you can use some default ones that RobustWealth has created for you. You can take existing asset allocation models and build glide paths around them, or you can create distinct asset allocations for your glide path models. Custom glide paths that take into account investors’ time horizons, risk tolerances, etc. are a powerful function that many competitors cannot match. As is the case with the traditional model approach, the platform evaluates portfolio drift daily and rebalances as necessary.

With the “robo” feature turned on, the platform will invest new money to keep the portfolio in balance, rebalance if there’s drift and also rebalance to accommodate withdrawals from the portfolio. The rebalancing program seems to be sophisticated. It takes into account not only portfolio drift but also the risk and the cost of trades, including any mutual fund or custodian fees that may be imposed—plus normal trading costs. It also takes into account tax implications.

At the holding level, you can instruct the program to do things like avoid harvesting short-term capital gains and violating wash-sale rules. You can “lock” a holding in two different ways. If you lock a holding as “ignore,” the program will rebalance the portfolio as if the holding does not exist. As an alternative, you can tag an asset as “hold.” This will cause the application to create a completion portfolio around the holding. For example, you might have a client who works for GE and cannot sell his or her GE stock. Say the company represents 10% of the portfolio. If you classify GE as a U.S. large-cap stock and your model allocates 40% to that category, GE would count for 10% of your allocation, and the program could buy only another 30% of U.S. large cap.

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