At Pershing’s first-ever virtual INSITE conference, the clearing and custody firm announced that the more than 11,000 advisors using its managed accounts technology will have access to a multicustodial oversight tool by the end of the year. The tool, called Managed Accounts Central and powered by Pershing, will be available to Pershing and non-Pershing clients in the fourth quarter of 2021.
The tool permits wealth managers to oversee their advisory business on a single platform, regardless of custodian, according to the announcement. Firms are still able to outsource managed account tech and investment management while using the new tool.
Already in development for 10 months, the custodial technology is designed for transparency and ease of use, according to the announcement. “Our new solution will help support [the growing interest in managed accounts] by making it easier for clients to manage their advisory business via the convenience of a single platform,” said Sarah Chain, director of global strategy and product management, in a statement. Developing the tool in-house allows Pershing to scale, she said. “As investments in managed accounts grow, so does the need to streamline the process of running these accounts.”
Managed Accounts Central plugs into a Pershing-built dashboard that displays information like portfolio performance, account holdings and asset allocation across custodians. In offering its tech to non-Pershing clients, the clearing and custody firm makes the most of advisors’ attention by showcasing its own model marketplace, also scheduled for launch before year-end. The marketplace is slated to have third-party and proprietary models, the latter of which will feature models from BNY Mellon Investment Management and Lockwood.
The new tool is an extension of managed account capabilities already used by advisors custodying at Pershing, added Ram Nagappan, chief information officer at the firm. Pershing has 1.6 million accounts with over $730 billion in assets across its managed accounts technology.
The Managed Accounts Central tool—and its availability to those outside the Pershing client base—will make the firm competitive with third-party providers of similar technology, like Orion, Envestnet and Altruist, said Alois Pirker, research director for Aite Group's wealth management division. Advisors are ready to reach for third-party tech providers, and Pershing doesn’t want to cede that ground.
“Either you’re in or you’re out,” he said, when it comes to investing in tech that will compete with third parties. Pershing’s move to provide tech to those outside of its client base makes the firm a third-party provider in some ways, directly competing with other third parties.
Pirker expects the firm’s move to kick off a wave of investment in technology among clearing and custody firms. “You need to be really viable on the technology level,” he added. “The market is shifting as we speak.”
