Report from the 2016 TD Ameritrade LINC Conference

If the recently concluded TD Ameritrade LINC Conference is any indication, 2016 is going to be another year of tremendous innovation in the field of advisor technology. During the event, Danielle Fava, senior product manager for iRebal outlined the progress her group as made with the online version of iRebal. Over the past year, TD Ameritrade has onboarded 1,000 new iRebal user firms, bringing their total user base to over1,700 firms that have been trained and onboarded. According to a TD ameritrade Institutional survey of iRebal users, 89% said they had adopted iRebal because it saved them time over their previous rebalancing solution.

The next iRebal release, scheduled for last Q2 2016 will provide a number of enhancements that iRebal users have requested. The first is the ability to print the portfolio detail screen to a PDF file. According to TD Ameritrade, 64% of iRebal users discuss their rebalancing capabilities with their clients and prospects. Many want the ability to share portfolio details from iRebal with their clients. Advisors will now have the ability to print or email this information to clients. Advisors can also now save copies of the information for record keeping purposes. The reports can be customized to include or exclude various data points to suit various use cases.

Advisor have been asking iRebal support: “How can I configure my models after a fund closes to new investors?” Previously, the work around was to create a new model. Now, advisors will be able to configure an “alternate if held” fund. In fact, you will be able to create multiple alternates if necessary.

iRebal will also be adding multiple new import/export capabilities. For example, you will be able to export all securities rules for a master account and add multiple equivalents to a master at once. You’ll be able to assign portfolios to categories en mass, and export a list of all portfolio restrictions. You will be able to import rebalancing band, export model history, and much more.

Some clients are prohibited from buying securities that exist in an advisor’s model because they are employed by the firm, sit on a corporate board, etc. iRebal is adding a “never buy” restriction to accommodate these situations. This restriction can also be applied to a category of securities, e.g. “sin stocks”.

Yet another new feature the “Quick View of Cash After Rebalance”. This will show whether or not an account being rebalanced will be within its set cash range after a proposed rebalance occurs. Previously, iRebal only allowed advisors to set minimum trade size as a dollar amount. It will now include an option to set minimums as a percentage to better accommodate large accounts.

Finally, TD Ameritrade is adding a limited ability to include held away assets. Advisors will manually be able to upload held away accounts, such as holdings in a 401(k) plan to iRebal, but advisors will not be able to trade the held away assets through iRebal. The idea here is to give advisors a more holistic view of all the clients assets and to rebalance around those assets if they choose to do so. Or, they can use iRebal to suggest trades and execute then through the appropriate facility later. The downside of this approach, other than the lack of trading capabilities is that every time the composition of the held away assets changes, they must be uploaded to iRebal to keep it current.

Based on the reaction of attendees in the iRebal session, advisors appear to be very pleased with the direction that iRebal is taking.

During the conference, TD Ameritrade announced that they are acquiring the assets of FA Insight, a research, benchmarking and consulting firm. FA Insight will give advisors ready access to some of the industry’s deepest and most comprehensive collection of business information.

By having FA Insight’s capabilities in-house, TD Ameritrade Institutional will be in a position to propel practice management into a new era. Rather than providing advisors access to general, research-based white papers and off-the-rack studies throughout the year, RIAs on the TD Ameritrade platform will have ongoing access to tailored peer benchmarking data and guidance on such key issues as client acquisition, staffing and compensation, pricing strategies, operational efficiency and risk management.

“Traditional practice management programs offer guidance on how to run a better business, but advisors can read a hundred research reports and still not gain the kind of timely, individualized intelligence they’ll receive through our business performance solutions program,” said Jim Dario, managing director of TD Ameritrade Institutional product management. “We are confident that by bringing Big Data to RIAs, we will amplify our ability to help more clients optimize their performance.”

The goal over time is to build analytics dashboard into VEO One, the next generation TD Ameritrade advisor workstation to deliver FA Insight data, and other proprietary data to advisors in an easily accessible format.

TD Ameritrade is also making great progress on their VEO One platform, now in beta testing with a limited group of advisors. The platform will soon offer all the functionality of the current platform, which currently includes 103 VEO integration partners, and it will add some exciting new functionality as well.

For starters, VEO One will feature a highly customizable home page capable of incorporating data from both the TD Ameritrade platform and data from VEO third party integration partners. It will include new, enhanced cash management functionality on a new cash management page.

A powerful “message bus” will allow for the sharing of information across applications as well as the ability to synchronize information should the advisor wish to do so. For example, if the TD Ameritrade custodial platform issues an alert, it can be pushed out to other applications, and it can even be used to trigger a workflow. For example, if a client writes a check for $100,000, VEO One can be configured to share that information with other applications. If could, for example, send an alert to iRebal. If the rebalancing threshold is less than $100,000, a rebalance workflow could be triggered in iRebal.

A simply synch scenario would be if an advisor changes a client address in their CRM software, that change could be passed to the custodial platform, the portfolio management software, the financial planning software, etc.

Yet another area of innovation is co-creation. TD Ameritrade is working on creating tools that will allow third party software providers to more easily build to the TD Ameritrade platform. This will allow firms to do more development with less reliance on TD Ameritrade’s staff. The hope is that this will unleash additional creativity and allow developers to bring additional functionality to TD Ameritrade advisors more rapidly.

One other initiative of note that was announced during the conference is the Human Finance Project, a collaborative effort between TD Ameritrade Institutional and RIAs to collect and share stories about what it really means to be a fiduciary advisor. Unlike a traditional marketing campaign, real advisors will play a leading role in both providing the content and serving as a distribution channel to get the word out about the benefits of working with an RIA.

“Financial advice ads often sound the same. As a result, consumers remain confused about the difference between investment advice models and the different standards of care in the industry,” said Tom Nally, president, TD Ameritrade Institutional. “RIAs are uniquely positioned as fiduciary advisors who put their clients’ interests first at all times, so we need an equally unique way to tell the RIA story. We’re excited to launch the Human Finance Project and hope this is the start of a powerful movement to further set RIAs apart from the competition.”

The Human Finance Project aims to help people gain a better understanding of the work RIAs do for their clients and the value of having a personal relationship with an independent advisor. To help spread the message about the benefits of working with a fiduciary, RIAs will have the opportunity to share their stories through video interviews and by posting photos to Twitter and Instagram using the hashtag #humanfinanceproject.

In addition to being a great marketing idea for the industry, the Human Finance Project provides an excellent example of how advisors can leverage the web, video, and social media to promote their own businesses.

In addition to the TD Ameritrade technology innovations, many announcements from TD Technology Partners were announced. We’ve provided a link to a few of them below.

There will be no lack of technology news this month. During the T3 Advisor Conference we expect significant technology announcements from some of the most prominent firms in the industry, as well as some interesting releases from the many other firms in attendance.

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