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Portfolio > Portfolio Construction

UBS to Give Advisors BlackRock’s Aladdin Risk Tools

By Janet Levaux

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A year after it formed a partnership with robo-advisor SigFig, UBS says it has struck a deal with BlackRock and expanded one with Solium Capital to rollout more technology to its nearly 7,000 advisors in the Americas.

Earlier this week, it announced that it is working with BlackRock to offer Aladdin Risk for Wealth Management tools to both its registered reps and home office employees. UBS says it is the first U.S. wealth manager to use Aladdin’s risk management and portfolio construction tools, which let advisors and others analyze portfolios with risk and return analytics that BlackRock Solutions provides to institutional investors.

(Related: BlackRock Replaces People With Machines in Revamp of Stock Unit)

The Aladdin rollout will start in the summer to advisors who manage discretionary portfolios and then will later expand to more FAs and client portfolios. The tool serves as a multi-asset analytics engine that reviews portfolios with stocks, bonds, mutual funds, ETFs, options and structured products using a factor-based approach.

(Related: BlackRock’s Fink: Tech to Overtake Its Money Managers Soon)

“Aladdin will be a huge enhancement to our advisory business,” said Jason Chandler, head of Investment Platforms and Solutions for at UBS Wealth Management Americas, in a statement. “Our advisors will continue to provide differentiated, client-centric solutions, but now they will also be supported by the same sophisticated risk analytics used by world-leading institutional investors.”

According to UBS, the partnership with BlackRock is part of its larger digital strategy, which includes the Advisor Technology Research & Innovation Lab it set up with SigFig.

“Aladdin will enable our home-office to better understand the risks in client’s portfolios, and to enhance their guidance to advisors by deploying this sophisticated, multi-asset analytics engine,” explained Brian Hull, head of UBS WMA Client Advisory Group. “UBS clients benefit most when our advisors combine their own experience and intimate understanding of client needs with our new technology and the advice of our home-office investment professionals.

Equity Comp Technology

In other news, UBS is expanding its partnership with Solium Capital to add about 50 new features and create a new corporate equity plan platform, UBS “Plan Admin Pro.” The platform will rely on Solium’s Shareworks and will give UBS corporate clients access to more equity plan administration capabilities starting in the third quarter.

“Clients tell us that state-of-the-art technology is top of mind for them,” said Michael Barry, head of Equity Plan Advisory Services, UBS Wealth Management Americas.” Delivering Solium’s technology provides a multi-faceted platform, and allows us to focus on accelerating an enhanced participant experience. We will continue to own and deliver all aspects of service delivery to our clients and are firmly committed to helping both our corporate clients and participants achieve success.”

EPAS, which involves about 200 UBS financial advisors and the firm’s digital channel One Source, currently works with about 180 corporations with 1 million employee participants in over 100 countries.

The advantage of the platform for UBS advisors is that it means they’ll have more time to spend working with the plan participants, according to Michael Barry, head of Equity Plan Advisory Services, UBS WMA.

“That is very important, given that industry research shows that employees don’t fully value what they do not understand when it comes to equity compensation, for instance,” Barry said in an interview.

Advisors can deliver more education and advice regarding corporate equity within the broader context of financial planning and wealth, he said. “This means that the perceived value of the [equity] awards goes up significantly.”

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