Riskalyze is making its risk management and portfolio analytics products available across the entire Cetera Financial network at no addition cost to its advisors and representatives, the two companies announced on Tuesday.
Riskalyze will be embedded within Cetera's AdviceWorks platform for the independent broker/dealer's more than 8,000 financial professionals.
The new toolset is meant to enable Cetera-affiliated advisors and reps to “set expectations with clients and document their fiduciary care, while adding a layer of business value protection for their practice,” according to a statement announcing the agreement.
Tom Taylor, Cetera's chief sales and growth office, said the tools should not be new to many of the IBD's advisors.
“Cetera allows choice in independence and, as such, a good number of Cetera advisors already had Riskalyze in place before this launch,” he wrote in an email, pointing out that, for example there are robust risk features in the network’s My Advice Architect and in several of the network’s other product partner offerings.
“Implementing an additional solution like Riskalyze enhances financial professionals’ risk management capabilities with a comprehensive and consistent approach to benchmark, measure, document and analyze risk for investors,” wrote Taylor.
Cetera's advisor and reps will also have the option to upgrade to Riskalyze’s premium products at a discounted rate, which will vary “based on firm size” but will be “competitive and exclusive to Cetera’s affiliated financial professionals,” according to Taylor.
When asked about how much advisors stood to save based on the new agreement, Taylor responded that an advisor’s savings would vary depending on what tools advisors were using previously and based on her or his firm size.
Will Trout, director of wealth management for Javelin Strategy & Research, said he saw upside for Cetera on two fronts: improvements in efficiency across the network and enforcement of Regulation Best Interest.
“Building an integrated front-office workflow that starts with profiling tools and feeds into MyAdvice Architect/AdviceWorks presents efficiency gains that will help the mother ship and give advisors another reason to sign on,” said Trout.
He also said the “build-in” (rather than an external integration, Riskalyze’s technology is being built into Cetera’s tech ecosystem) presents a way to get out ahead of more robust enforcement of Reg BI, especially when it comes to the appropriateness of product recommendations.
“Ultimately, it’s a way of more tightly integrating the workflow around the investment policy statement, and make both portfolio production more seamless and more defensible in case of arbitration,” he said.
