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Portfolio > Portfolio Construction

For Firms in the United Capital Fold, a New Platform

By James J. Green

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United Capital Financial Advisers has partnered with FundQuest to build a suite of Web-based tools for UCFA advisors and their clients that cover the waterfront of advisor needs, from back-office operations to sales and productivity tools, to portfolio accounting integration, to account aggregation. Working with whatever portfolio management software packages those advisors already use, the platform also provides access to FundQuest’s investment portfolios, which include hybrid active and passive strategies, and income-oriented portfolios.

In addition to its outsourcing expertise, FundQuest is a major player in the separately managed account and unified managed accounts business, with $64 billion in AUM in its U.S. and European operations.

UCFA, led by CEO Joe Duran, has $9 billion in assets in advisory and administration in its 20 offices around the U.S., up from 14 offices last year, Duran said on April 20 in an interview, with more in the pipeline toward building “the nation’s first full-service RIA.” He said there were several “major” acquisitions that UCFA may report soon. UCFA chose FundQuest not simply for its investing acumen, but because of its ability to accommodate UCFA’s scale, and its expertise in “onboarding” new firms into the platform.

Duran said the wealth platform will help solve the operational bottleneck of those offices all using separate models and separate technologies to manage the models, since “all these firms’ systems are bootstrapped.” The operations issue is one of four “quadrants” that UCFA addresses with its acquired firms, the others being administrative, or back-office; practice management; and the delivery of advice.

In addition to increasing efficiencies for already independent firms that join the UCFA network, allowing the principals to spend more time in client-facing activities, Duran argues that “it’s a huge elevation in reporting, with total straightthrough processing.” Jason Del Col, UCFA’s VP of Wealth Services who worked on designing the platform with FundQuest, said it would also appeal to wirehouse brokers considering a move.

Duran said that despite the wirehouses’ well-documented troubles, “their technology in operations is so far ahead, this allows us to catch up.” Ironically, however, he points out that “These folks who leave the wirehouses aren’t operationally sophisticated at all.” Del Col said the platform “does not just compete with what the wirehouses and BDs can offer, but surpasses these service models.”

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