LPL
Although LPL is usually thought of first and foremost as the largest independent B-D, the company was quick to remind me that it is also the fifth-largest independent RIA custodian. According to Victor Fetter, chief information officer at LPL, much of the work his team is engaged in supports the transition of advisors to the RIA model.
LPL’s next-generation advisor platform, ClientWorks, which is in the process of being rolled out, supports an advisor’s transition to the independent RIA model. There is an increased emphasis on integration with third-party software products. For CRM, LPL now offers integration with Salesforce and Redtail CRM. For portfolio management, LPL now offers integration with the three most requested providers: Albridge, Morningstar and Orion. LPL has long offered integrations with eMoney, the most requested financial planning software provider.
In addition, at this past year’s annual conference, LPL announced its affinity program, a curated list of providers that LPL believes offers products and services that can be beneficial to advisors. LPL believes that firms participating in the affinity program are priced attractively and have the scale to service an organization of LPL’s size. Not all firms on the list are technology firms, but a good number are. Fetter has hinted that going forward LPL will be looking to the affinity list first for future integration partners.
Fetter also suggested that LPL will be looking to add value as third-party integrations progress. For example, when integrating a new offering into the platform, the company will look at how to best integrate in order to offer the best core platform experience. This might mean providing additional functionality not available in the off-the-shelf versions of a product, or it might be a somewhat different user experience that is unique to LPL.
On the data analytics front, LPL will roll out a practice management dashboard in the first half of 2016. The dashboard will provide key metrics such as assets under management, inflows and outflows, commissions/fees and profitability—and more. There will be different dashboards for different roles at the firm. Advisors will see advisor-level data and principals will see firm-level data that includes all of the above on a consolidated basis, with the ability to drill down to look at activity at the advisor or account level. In addition, institutions will have the ability to view analytics by geographic region and by branch.
Cybersecurity is a topic on everyone’s mind, and LPL is investing to ensure their defenses remain strong. While the firm cannot provide details for obvious reasons, the investment is significant and ongoing.
Fetter says that LPL is closely following the Department of Labor’s rule-making process regarding potential changes to retirement plan regulations. He says that if it becomes necessary, LPL will invest in order to support the technology needs of advisors who deal with retirement accounts and retirement plans.
LPL will have a digital advice offering for advisors. The firm is currently engaged with a number of LPL advisors who are helping to design that offering. While he declined to provide many details, Fetter did say that the digital advice platform would be complementary to LPL’s core technology offering and that it would integrate with the core platform.
TD Ameritrade
Like its peers, TD Ameritrade has been busy on the technology front. Perhaps the biggest news is that TD Ameritrade is currently beta testing Veo One, its next-generation advisor workstation. Currently, there are 12 Veo One integration partners: Orion, Laser App, MoneyGuidePro, Redtail, DocuSign, Black Diamond, eMoney, Finance Logix, iRebal, Morningstar, Salesforce and Thinkpipes. Two more, Junxure and Laserfiche, should be integrated by the end of this month. Eventually, we expect the approximately 90 vendors currently on the Veo platform to transition to the new Veo One platform.
Some highlights of the new platform include its simplified work flows, its more efficient design, the ability it gives users to launch all apps from the Veo One platform and its business intelligence. Work flows are enhanced through your ability to manage your day from one platform with information from different Veo integrated applications together in one view. Veo One enables you to update information once and have it automatically apply to other integrated systems. In addition, the platform adapts to you and how you work by analyzing your activity patterns and presenting relevant information to help you work smarter. For example, when you open a new client account, the platform will offer next steps to minimize the number of clicks necessary to complete a task.
Veo One is designed with tabs and windows that provide a comprehensive view of all the data you need to run your business more efficiently. You can launch all of your integrated applications right from within the Veo One platform. Each module can be minimized to save screen real estate and expanded when needed.
The platform provides useful analytics to help you identify where you need to take action to stay on the path of continued growth. These analytics include: client count growth, asset growth and bill tracking so you can analyze trends in fee income over time.
TD Ameritrade continues to on-board clients to the cloud-based, tax-sensitive, household-level rebalancing version of iRebal that is free to its advisors. Since the launch of this tool, more than 1,500 advisors have used it in their business. Currently, it can only rebalance accounts that are custodied at TD Ameritrade, but according to Jon Patullo, managing director of technology product management at the firm, the plan is to increase iRebal’s scope in 2016 to begin accepting outside assets. There are also plans in 2016 to make APIs available so that the many third-party software vendors on the TD Ameritrade platform for advisors can use it. How might this work? To cite just one example, a digital advice provider that is currently integrated with TD Ameritrade could use the iRebal API to rebalance all the accounts on a digital platform, freeing the platform developers from having to create their own rebalancing solution.
Last month, TD Ameritrade started a “going green” initiative. It allows the clients of advisors to set themselves up for electronic statements and for e-delivery of other documents.
Another major technology initiative is the rollout of AdvisorClient.com, the web portal for end clients of TD Ameritrade advisors. This portal leverages the technology of the TD Ameritrade retail site, but customizes the experience for advisor clients. An initial rollout began last May, but TD Ameritrade continues to add features and customization options to make the portal more robust and more user friendly.
Closing Thoughts
As technology prowess plays an increasingly important role in the success of advisory firms, RIA custodians are striving to supply the necessary tools that empower advisors to take their businesses to the next level. They are also competing with one another to provide superior technology so that they can differentiate themselves from the competition. In next month’s issue, we’ll explore what some of the other leading RIA custodians are working on.