FMR to add optimization to WealthCentral platform

Thomas Coyle

19 May 2008

Northfield joins Advent, Oracle and Naviplan on RIA-platform's vendor list. Fidelity plans to make portfolio modeling and rebalancing an integral part of WealthCentral, its business platform for RIAs. The new capabilities, featuring technology and support from Northfield Information Services, help RIAs identify, measure and control overall portfolio risk in client accounts using sophisticated rules and risk-based factors -- and lets them do these things within a single web-based, custody-neutral interface that also taps into trading, portfolio accounting, CRM and financial-planning capabilities.

"Every minute that advisors can reclaim from basic account administration tasks, allows them to focus more on investment management and client service, which are crucial to the success and profitability of every firm," says Jack Callahan president of Fidelity's Institutional Wealth Services unit.

Wide open

When rebalancing an account, WealthCentral optimization system will factor in risk, user-defined return forecasts and potential tax consequences at the trade and portfolio levels. This is supposed to result in a "fully optimized, tax efficient portfolio at the individual client account or household level," according to a Fidelity press release.

"Integrating advanced capabilities, such as rebalancing, into Fidelity WealthCentral will further demonstrate our commitment to offering advisors the industry's most advanced and scalable platform to help them increase operational efficiencies and grow more profitable practices," adds Callahan.

In addition to Northfield's modeling and rebalancing technology, WealthCentral features Advent's Portfolio Exchange, Oracle's Siebel CRM On Demand and EISI's Naviplan financial-planning application.

Competition among advisor-technology integrators is stiff, however. Odyssey, Thomson Financial, NorthStar Systems International and Finantix contend with standalone front-office system vendors like AdviceAmerica and SunGard -- and none of them can truthfully claim dominance in any private-client advisory channel.

But Fidelity figures its ability to bring portfolio modeling and rebalancing -- mainly the province of large firms "because traditionally high price points" -- to RIAs will give WealthCentral an edge in one of the fastest growing channels in the financial-service sector.

Fidelity IWS custodied more than $350 billion in assets on behalf of more than 3,800 RIAs, trust banks and third-party retirement-plan administrators at the end of March 2008.

Northfield has more that 250 institutional clients in 18 countries. Among them are investment managers, public- and private-plan sponsors, investment advisories and hedge funds. -FWR

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