Folio’s New Platform Suited for Bespoke SRI PortfoliosFolio’s New Platform Suited for Bespoke SRI Portfolios

With the recent launch of Folio Financial’s Digital Wealth Platform, the wealthtech company is eagerly looking for new customers. Not surprisingly, Folio’s own registered investment advisory, First Affirmative Financial Network, is committed to using it, and Folio hinted that another major client, a “large credit union,” was on the verge of committing as well.

That credit union doesn’t appear to be Navy Federal Financial Group, WealthManagement.com has learned, despite the organization’s size and the two having worked together in the past.

Navy Federal Financial Group has “no affiliation” with Folio Financial’s new investment platform, according to Mathu Mathu, associate vice president of operations for Navy Federal. Instead, Navy Federal is continuing its work on its own automated advise platform, intended for use by some of the $95 billion in assets held by the organization, he said.

That project was announced in late 2016, when the firm said it was working with Folio Investing, a subsidiary of Folio Financial, to develop a self-directed online investing platform for individual investors alongside its in-the-works robo advisor. At the time Navy Federal expected the services to be available in 2017, but the project’s taken longer than expected. That partnership led to some speculation that First Financial’s platform might be the culmination of the 2016 announcement.

Investors with Navy Federal will have to wait a while longer. “We are committed to providing exemplary service to our members, offering them the best products possible,” said Mathu in a statement. “As part of this process, we are continuing to further develop our robo advisor and digital offerings and will be rolling them out in due time. In regard to the new Digital Wealth Platform, Navy Federal has no affiliation.”

Folio declined to provide the name of the credit union interested in the platform.

First Affirmative, meanwhile, has committed to the Digital Wealth Platform, which is billed as a sort of Swiss Army knife for advisors. The platform has a stand-alone robo advisor, a comprehensive advisor workstation and can support a spectrum of advising styles, from fully automated to human-provided financial advice, according to Folio Financial.

The platform integrates with Folio’s brokerage capabilities, the firm noted in a statement; it includes a customizable client assessment questionnaire and automated portfolio construction with screens for socially responsible investing preferences. It can also run probability-based forecasting—hitting many of the targets advisors expect from modern systems.

First Affirmative was impressed. “We are implementing it as an advisor-driven platform,” said Theresa Gusman, the RIA firm’s chief investment officer. “It allows the advisory firm to incorporate their own intellectual capital into the portfolio construction process. It allows the advisor to choose whether they want this to be a pure robo platform, where they have their clients go in directly to the platform, or an advisor interface, where the advisor is working with the client to set their objectives.”

The advisors at First Affirmative, with its $887 million in discretionary assets under management per its most recent filing, focus on SRI-type investing. Folio’s solution is good at handling those types of portfolios, said Gusman. Previously, the firm used managed mutual funds and models inside managed accounts; with the new platform, advisors are able to add more exclusions at the individual investor account level, such as removing equities that clients may not want to hold based on their investing philosophies. “This is an extremely flexible platform,” she added.

First Affirmative will undoubtedly have some influence when it comes to new integrations, noted Gusman, so early adopters of the platform would be wise to expect an interface with Saleforce, First Affirmative’s CRM. Additional third-party integrations, as well as account aggregation, are also on the development roadmap.