In particular, independent advisors need access to sophisticated optimization and due diligence tools to ensure their client portfolios take a strategic approach to asset allocation and product selection. Preferably, these due diligence platforms will incorporate extensive and up-to-the-minute databases along with customized reporting capabilities to allow rapid and accurate investment product assessment. Along these same lines, optimization software should empower advisors to quickly simulate every potential portfolio along the efficient frontier for a given client’s risk tolerance and other needs.
Our industry has evolved considerably, so independent firms and advisors owe it to themselves and their clients to re-examine their approach to portfolio construction to ensure they are leveraging the best possible tools and techniques to help deploy and adjust portfolios that will truly serve their clients’ best interests over the long-term.
Chris Phillips, CFA, MBA, is director of advisory investments for ProEquities, an independent broker-dealer and RIA headquartered in Birmingham, Alabama.