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June 24, 2015 at 07:50 AM
RIAs that custody their clients’ assets with Charles Schwab now officially have the option of calling themselves Robo advisors.
That’s because the behemoth discount broker has rolled out its Institutional Intelligent Portfolios platform, specifically designed for the broker’s RIA channel to meet retirement investors’ growing craving for web-based advisory solutions.
What the platform claims to offer could be called a turnkey solution for advisors.
Individual firms will be able to brand their own identity around the new web and app programs, which will interface with Schwab’s existing desktop platform for RIAs, and RIAs will of course retain the ability to set their own fees.
Advisors can build out their platform with a series of pre-designed asset allocation models, and deploy Schwab’s Investor Profile Questionnaire to determine investors’ risk tolerance.
All portfolios will be required to hold at least 4 percent of assets in cash. Once enrolled, all communications, including trade receipts, will be delivered electronically, through the app.
Schwab now hosts 450 ETFs across 28 asset classes that advisors can build portfolios off of. In a statement, Schwab disclosed that the firm will get paid off of the assets in proprietary and third-party ETFs, as well as earning revenue on trading activity in the portfolios, but the firm did not disclose how much.
