Asset-Map Brings Industry Leaders Together (Virtually)
What Happened: Asset-Map hosted AdviceTech.LIVE, a one-day digital conference designed around helping advisors see how technology solutions can work together in their businesses.
Why It Matters: I had a great time participating in this one. Asset-Map’s one-day digital event gave advisors, who are relying on technology more than ever because of mandated remote work, a chance to catch up on what’s new and what’s coming up in advisor tech. And let’s not forget the bigger picture—half of all ticket sales benefited CFP Board diversity initiatives. Well done, Adam and team.
Apex Clearing Hires Tricia Rothschild as President
What Happened: Former Morningstar executive Tricia Rothschild joined Apex Clearing as its new president. Tom Valverde also joined Apex as general manager of its advisory division.
Why It Matters: People ask me all the time: “Are you concerned about consolidation in the industry?” Every time the merger bell rings, another market entrant gets its wings. Apex is making all the right moves to become a real player in RIA custody, bringing Tricia Rothschild’s product and partnership chops to the table. Not only that, but they picked up the sales expertise that Tom Valverde honed at Fidelity and Pershing for years.
LPL Adds Slack Messaging for Advisors
What Happened: LPL added the popular messaging platform Slack for its advisors to use for cross-team collaboration.
Why It Matters: The knock against broker/dealers is that they don’t always provide access to the most up-to-date technology. Not so at LPL—it’s instantly added some cachet to its organization by adding the wildly popular up-and-coming business collaboration/chat app to its tech stack for advisors. Great to see.
Class Action Lawsuit Filed Against Envestnet
What Happened: Envestnet | Yodlee was named as a defendant in a class action lawsuit that alleges the company hasn’t taken proper precautions to protect consumer data. The primary complaint is that Yodlee stores user credentials rather than use the OAuth protocol to access banking data, which the suit claims leaves users with “no redress” if they want to stop Yodlee from accessing their data.
Why It Matters: There are so many holes in this lawsuit, you could drive an 18-wheeler through it. Yodlee is a service that few consumers know about, but many rely on heavily. My personal finance software allows me to link my bank and credit card accounts using Yodlee, allowing me to keep much better track of the Klein family finances than hours of rekeying data would.
Most U.S. banks don’t yet offer Yodlee the ability to link up data using the OAuth protocol, so the only way this works is for the service to store my credentials. But “no redress?” Baloney! Every time I change my bank password—and you can bet I do that every six months or so—I have to go update the Yodlee link because I just cut it off from access to my data.
Other claims in the lawsuit are just as bad. Here’s the deal: Nobody is forcing you to use a service where you link your bank account via Yodlee, Plaid or others. If you choose to do so, you are providing your data to those companies and the analytics services in between. If you don’t trust them or prefer not to do that—then don’t do it! But you can’t have your cake and eat it too. Ultimately, life is about choices.
Schwab Keeps thinkorswim
What Happened: Schwab announced it will integrate TD Ameritrade’s thinkorswim and thinkpipes trading tools into its existing technology solution.
Why It Matters: One of the biggest questions about Schwab’s acquisition of TD Ameritrade was what would happen to popular TD Ameritrade technology like iRebal and thinkorswim. This is welcome news for many advisors. Still no word on Veo and VeoOne, and how Schwab will blend the two firms’ playbooks for wealthtech ecosystem integrations. As a partner of both firms, we’ll be watching with great interest.
Robinhood Users Like to Trade ... a Lot
What Happened: Data from Robinhood users revealed that daily trades through the app more than doubled in Q2 2020 when compared with the previous period.
Why It Matters: When no-commission trades became commonplace, many asked how the change would affect consumer activity. It appears that those who thought it would allow the average investor to be more active were right. The jury’s out on how good (or bad) that will end up being for portfolio balances.
What is certain, though, is that in periods of extreme volatility, our propensity for making bad short-term decisions goes up. Here’s hoping that Robinhood clients are successful enough to graduate to the steady hand of an advisor who can help coach them through the inevitable complexity that is coming.
Broadridge Survey: Majority of Advisors Don’t Have Good Tech
What Happened: A Broadridge survey found that more than 75% of advisors say they’ve lost business because they didn’t have the right technology for their client experience.
Why It Matters: This study illustrates the importance of prioritizing technology investments for a practice. Without the right foundation for an exceptional client experience, it’s difficult to serve clients to the fullest extent.
Last week at AdviceTech.LIVE, I suggested that advisors should visualize the practice they want to have, ask themselves what technology spend they would reasonably expect to have for that level of automation in their business, and then work backward and figure out how to invest aggressively to accelerate their path to that success.
Wealthfront Pushes Cash Accounts
What Happened: Wealthfront has rolled out gamification in its app to encourage users to pay bills and more with new FDIC-insured cash management features.
Why It Matters: Client expectations are always shifting, and advisors need to stay on top of those changes. As robo-advisors like Wealthfront expand their scope to provide more fully featured financial solutions, they get average consumers to expect banking-style services from an investments company. Some larger RIAs are already there—will firms of all sizes follow suit?
