Fidelity Clearing & Custody Solutions’ Automated Managed Platform (AMP), a white-labeled robo advisor, is now publicly available to Fidelity advisors.
The company first announced AMP nearly a year ago and is built using the technology Fidelity acquired with its blockbuster purchase of eMoney Advisor. The product had been in beta for some time to collect feedback from advisors, and Fidelity feels the hybrid robo solution is ready for primetime.
While the market is increasingly filled with competing offers, Gary Gallagher, a senior vice president of investment products at Fidelity Institutional, said AMP stands apart for its deep integrations with Fidelity’s Wealthscape brokerage platform, allowing clients and advisors to go seamlessly from financial planning directly to opening and funding an account. AMP streamlines the account-opening process down to a minimal set of questions that only require a minute or two to complete.
Geode Capital Management provides the investment strategies, just as it does with Fidelity’s retail robo, Fidelity Go. The plan is to allow advisors to customize the investment models and add their own in 2018.
Unlike Fidelity Go, AMP is designed less for millennial clients opening their first investment account and more for advisors looking to bring financial planning into their practice. Gallagher believes “firms that don’t have a digital experience are quickly going to find themselves behind the curve,” and AMP provides a way for advisors to offer new digital services to existing clients, such as eMoney’s client portal, account aggregation, budgeting and goals-based planning capabilities.
Advisors and firms need a subscription to eMoney Select to access AMP, and the product itself charges a net fee of 15 basis points, which includes custody and clearing, transaction and brokerage fees, and sub-advisory fees. Advisors put their fee on top of that. Based on the beta test group, Gallagher said the end fee for clients falls in the 50 bps to 75 bps range, similar to other hybrid advisors.
Ed O’Brien, the chief executive officer of eMoney, said that although Fidelity has taken a little longer to bring AMP to market, advisors will notice a difference compared with eMoney’s work with other firms. Advisors can more quickly put financial plans into action, which O’Brien says makes AMP relevant to clients across their entire financial lives.
“All of this is built on a single platform, so when the advisor decides a client needs more than pure digital service, they don’t have to pick them up and put them on a different platform,” O’Brien told WealthManagement.com. “Estate plans or more complex distribution plans, those are things that the advisor just turns on for the client.”
Gallagher added that AMP responds to growing demand from advisors for digital advice. According to a three-year study by Fidelity of more than 600 advisors, there has been an 80 percent jump over the last year in the number of firms exploring how to add digital advice. Four in 10 advisors are actively considering products currently available.
“Firms are getting their heads around what digital advice can mean in their business model,” Gallagher said. “RIAs are finding ways to use digital advice as a complementary strategy to support broader relationships.”
In addition to RIAs, the company says banks and broker/dealers have also committed to implementing AMP.
