Aside from the recent surge in artificial intelligence developments, I’d argue that the biggest tech story confronting financial advisors in 2023 is the ongoing merger of TD Ameritrade and Charles Schwab.
Beyond providing custody and clearing services to a large population of financial advisors, both companies are significant providers of technology. TD platforms like iRebal and Veo were especially popular in the advisor fintech ecosystem and are a major focus of the ongoing integration efforts.
Schwab named Sept. 5 as the date when everything from the Schwab platform will transfer over and says it's on track to reach the goal. But the amount of data that has to be transferred will be huge, and there will undoubtedly be technology hiccups along the way.
What that means for the greater ecosystem will be a defining trend for advisor fintech for the rest of the year. What will it mean for tools that pull data from Schwab or TD’s systems? What about account aggregation? Will competing custodians, TAMPs, fintech companies or aggregators be able to offer a compelling enough alternative to successfully woo advisors to their platforms?
We’ll see. If this is something your firm or fintech company is working through, I’d love to hear from you.
In the meantime, here’s a roundup of some of this week’s fintech updates you may have missed.
Before it completes its integration with Charles Schwab’s brokerage platform, TD Ameritrade is finishing a suite of new features and services for thinkorswim, its web and mobile trading product. Updates include predictive text when searching for live news and new ways to visualize outcomes on the desktop version, while the mobile version of thinkorswim is getting improved customization options, a more unified trading experience and improvements to trade tickets. Thinkorswim web also got some upgrades.
It was interesting to see this announcement come from TD Ameritrade more than two years after Schwab completed its acquisition of the firm. Thinkorswim doesn't move over to Schwab until later in 2023, but it’s a bit surprising that new updates aren’t being attributed to Schwab.
New tax-loss harvesting capabilities and actively managed equity funds are coming to Vanguard Digital Advisor, according to Barron’s. Of the five new funds, three are exclusive to customers of Vanguard’s purely digital and hybrid robo-advisor products.
Vanguard’s entry into the digital advice market came with financial advisors and quickly amassed an industry-leading sum of assets, primarily by moving over existing accounts. However, its digital products have lagged in terms of user experience, according to the researchers at Condor Capital Wealth Management, which publish the quarterly Robo Report. Improving the tax-loss harvesting helps the product catch up to other robos on the market, while the new investment products could help broaden Digital Advisor’s appeal to investors.
Envestnet has brought Pontera, the fintech that enables financial advisors to trade and manage clients’ held-away retirement accounts, into its financial wellness ecosystem. Advisors can plan, review and bill on employer-sponsored retirement accounts within the Envestnet Tamarac platform.
Pontera is rapidly growing as a presence in the space. The company had a streak of deals in 2022 after landing $80 million in funding and rebranding, including partnerships with SageView, Morningstar and Dynasty. The Envestnet integration is just another step in Pontera’s quick rise.
Advisor technology company Tifin announced that it would start pull aggregated industry trend information from Morningstar into the Tifin asset management platform, which provides marketing, distribution and sales to asset managers. The data can facilitate more precise intelligence on the consumption of different investment products, the company said.
The deal is an expansion of an existing relationship between the two companies, as Morningstar invested in Tifin’s Series B funding in April 2021. Tifin continues to sign deals and promote itself as a wealth technology platform powered by artificial intelligence, but it’s unclear how much traction it is getting among either financial advisors or asset managers.
Hearsay Systems, which provides various client engagement tools to financial advisors, added new features to Sites, its product for building a personalized, compliant website. Advisors now have more options for customizing the look of their site; a new administrative interface to update the website; built-in SEO tools for website visibility; and an improved hosting platform for faster load times and integration with third-party widgets.
Websites are good! It’s hard to know how effective this is without actually using it to make a website, but if you’re a firm that needs to upgrade your digital presence, check out Hearsay and let me know.
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