Amid today’s challenging market conditions, using the proper technology, especicially the right portfolio management software (PMS), can make a difference in your clients’ bottom lines, and yours.
So what have the PMS providers been doing? In a nutshell, they are offering more services, improving the way that their applications talk to other applications and handle data from multiple sources, and easing Web access to view multiple client accounts.
This year, the buzz surrounding portfolio management software companies has seemingly revolved around everything but the technology. For instance, Schwab announced this spring that it would cease selling and supporting Centerpiece, the PMS offering from Schwab subsidiary Performance Technologies Inc., to advisors who didn’t custody their client assets with Schwab Institutional. In June, Advent Software announced it would acquire TechFi, the provider of portfolio management and advisor outsourcing technology.
One could conclude that Schwab was pulling in the wagons, creating a closed system. And one could also conclude that the TechFi acquistion was another example of an old-line technology company gobbling up a promising competitor.
But such conclusions could be misleading, and maybe just wrong.
Warren Mackensen, the fee-only proprietor of Warren Mackensen & Co. Inc., in Hampton, New Hampshire, doesn’t feel that Schwab’s move with Centerpiece reflects any “narrowing,” but rather is a “business and marketing” move that has “nothing to do with the technology.” He points out that PTI is planning to move Centerpiece to a Microsoft SQL database platform.
Mackensen is no technology-challenged babe in the advisor woods, he’s a plain-spoken planner who thinks for himself and has used Centerpiece for 10 years, but he is a true believer in Schwab and its technology. As one example, Mackensen recently agreed to participate in the Schwab Advisor WebCenter program, under which advisor Web sites are hosted on secure AT&T servers, serviced and supported by PTI staff. “At the end of the day, after we do all our portfolio accounting, we will upload an XML file to the server, and then our clients can get online account access to their accounts.” Such online accees is available from other custodians, he points out, but says the “exciting” part is that the client can have multiple accounts at various custodians and brokerages and banks, and those accounts “will all be seen through the Mackensen.com Web site, and not just the accounts we have in Centerpiece.”