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RIA Custodians

Asset custodians are the central players in the RIA business and choosing one is the biggest decision most financial advisors will make to build their business. As the place where RIAs park their assets (the same way a captive broker would park assets at Merrill Lynch or UBS), custodians serve hundreds or thousands of these registered investment advisors and make big investments in technology and service on their clients' behalf.

This section features a series of articles under the “Asset Custody Project” label that cover these companies in a way that keeps advisors abreast of their progress – both with journalistic commentary and a common set of data so that advisors can easily compare them. The articles look at the strengths, weaknesses and niche capabilities of these companies.

— Brooke Southall

Here are links to the profiles of custodians:

  • Apex Clearing
  • Raymond James
  • State Street
  • Ceros Financial
  • Fidelity
  • Pershing
  • Royal Bank of Canada
  • Scottrade
  • Schwab
  • TD Ameritrade
  • Trade-PMR
  • Trust Company of America
  • BNY Mellon
  • Folio Institutional
  • Shareholders Service Group
  • National Advisors Trust
  • Equity Advisor Solutions
  • US Bank
  • If you want a more chronological look at news about the custodians, just scroll down.

    Tom Kimberly: We heard consistent feedback about the need for greater portfolio flexibility.

    Betterment makes Goldman Sachs and Vanguard partners as it shifts into higher RIA gear

    With advisors demanding to get back in the driver's seat, the robo's RIA chief, Tom Kimberly goes for two big-name model portfolio strategists under the 'Betterment for Advisors' brand

    September 14, 2016 — 1:29 PM UTC by Brooke Southall

    Brooke's Note: We have been talking about 'convergence' in the financial advice business from the days when people first realized that Schwab was trying to become Merrill Lynch and vice-versa. Schwab is winning that war for the middle by mostly every measure. Now it looks like Betterment is working its way toward becoming more like Schwab, and maybe like Envestnet, too. What we learned from the Schwab-Merrill scrape is that it helped Schwab to first establish ...

    Greg Vigrass: We're not incumbent on any system. That means we've got the ability to be far more flexible. We're like the plumbers.

    How custodians Folio Institutional and Equity Advisor Solutions keep on ticking -- Part 3 of 3

    Both custodians counter their peewee size by offering that something extra

    July 14, 2016 — 8:11 PM UTC by Lisa Shidler

    Brooke’s Note: Last but not least, we have Equity Advisor Solutions and Folio Institutional as micro-custodians that you might want to know about as your RIA custodian. See: The non-Big Four RIA custodians, no longer runts but stunted in growth, are applying tougher love to hobbyist RIAs. Like so many custodians they aggressively seem to stay off the radar with the blandest, least memorable names and the most ludicrous ways of describing their value ...

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    Tom Heffernan: I automate as much as I can. I can onboard 1,000 accounts today. Just automate so much of what we do that we don't have to add staff.

    How a Schwab cast-off became a niche custodian for RIAs who like to trade options

    MoneyBlock emerged from BrokersXpress after the San Francisco broker bought it but didn't want IBD reps in its mix

    July 13, 2016 — 8:51 PM UTC by Lisa Shidler

    Brooke’s Note: When lay people like me think of options trading, we think of some complicated high-paced crazy stuff. Used properly, options are a cheap way to hedge positions without paying insane hedge fund-level fees. That a new “custodian” has been formed with options trading support after being part of a Schwab indigestion event, is a minor head-turner.

    MoneyBlock is the new kid on the block and only began actively working with RIAs four ...

    Evan LaHuta: Is it reasonable to offer this type of discount for new clients, but not your long-term valuable existing clients?

    Schwab launches biggest RIA-targeted price war in years -- but TD and Pershing say they won't play along

    In what may be a prelude to commission-free RIA custody era, Schwab eliminates equity and ETF commissions for all new clients for a year; Fidelity says it is still cheaper

    July 1, 2016 — 8:25 PM UTC by Lisa Shidler

    Brooke’s Note: A throwaway line in the RIA business is that custody of RIA assets is a commoditized service. But is it? The price-chopping move by Schwab that we write about here is coupled with Schwab’s promise to spend millions advertising its RIAs. The bad news for competitors is that it looks like a sleeping giant — with a larger wallet than thou — is awakening. The bad news for Schwab is that it is ...

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    Jon Patullo [r.] with Jim Dario: We started here in Texas with nine vendors in 2010 to start the conversation.

    Alert to Pershing's API move and eMoney's dashboard acumen, TD Ameritrade brings its API partners to Texas to drive home its first-mover advantage

    TD does (almost) Dallas as it announces 100-plus third-party vendor integrations while keeping an eye on the competition

    June 30, 2016 — 12:05 AM UTC by Timothy Welsh

    At the TD Ameritrade Institutional Technology Summit, the elephant in the TD-rented room was Pershing Advisor Solutions.

    A little more than a year ago, at Pershing’s INSITE conference in Orlando, Fla., the other Jersey City, N.J.-based RIA custodian validated its open API approach to software integration. See: At INSITE in Orlando, Pershing outs its robo-religious conversion complete with open API store, Silicon Valley and India skunkworks, Marstone robo deal and unabashed digi-speak ...

    Christopher Norton: This campaign shows they are willing to ... run the type of national campaign these advisors could not execute on their own

    Schwab wows EXPLORE 2016 crowd with revived bid to advertise RIAs with two magic ingredients: Schwab branding and a budget of 'millions' of dollars

    Though skeptical observers call the effort window dressing, the San Francisco custody giant is incorporating lessons learned from the lackluster RIA-Stands-For-You campaign of 2011

    June 22, 2016 — 7:50 PM UTC by Lisa Shidler

    Brooke’s Note: Schwab is such a looming presence in the RIA business in its capacity as the key partner of 7,000 RIAs that we take note of even its smallest evolutions. But for the last several years, such metamorphoses have taken place predominately on the retail side of the business. Charles Schwab & Co. has gone from discount broker to HNW wealth manager, from low-tech to robo-tech, from mutual fund manager to ETF ...

    Joshua Pace: Some advisors have grown so frustrated that they make a change to go to independent custodians. We don't compete on any level with advisors.

    How an eclectic trio of RIA custodians are willfully gaining ground with snail-like precision -- Part 2 of 3

    Lazarus-like RBC has another new leader, as does Trust Company of America and Shareholders Service Group, which is selling itself as a Pershing reseller of high security, but with more agile service

    June 15, 2016 — 8:08 PM UTC by Lisa Shidler

    Brooke’s Note: In this second part of a three-part series on RIA custodians, I’ll start with the well-earned positive spin on the RIA custody ventures of RBC, Shareholders Service Group and Trust Company of America. RBC is a big, solid bank with a clean reputation and with deep connections to advisors through its regional broker-dealer. Shareholders Service Group is that rarest of phenomena — a pure RIA custody business that takes the smallest advisors ...

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    Mark Tibergien dodges F-Bombs from Julia Louis-Dreyfus -- allowing women to dominate Pershing's grab for change.

    Spinning 200+ years of legacy culture as a virtue, BNY Mellon uses Pershing INSITE to show its software side, softer side -- as it gets beyond NetX360 and men with a hard-wired approach

    Whether real fire follows these new clouds of smoke remains to be seen but Pershing's open API, robo strategy and feminine revolution project an aura of uplift

    June 10, 2016 — 4:20 PM UTC by Guest Columnist Timothy D. Welsh

    Brooke’s Note: Pershing, as unit of BNY Mellon, is a riddle. When it is falling behind and looking outdated, it hides behind bureaucratic words and throws PR cold water on media that try to gain more insight. But here’s the thing. When BNY does things right and cuts edges, it stays consistent and tosses out bankerly words — almost as if it wants obscure its progress. To be certain, Pershing is both a big ...

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    Robb Baldwin: Dealing with advisors who require lots of effort with very little assets, you realize that some of the greatest risk you end up facing is from small advisors.

    The non-Big Four RIA custodians, no longer runts but stunted in growth, are applying tougher love to hobbyist RIAs

    In part one of a three-part series, we examine how seven small custodians -- starting with Trade PMR and Scottrade -- are evolving away from the Utopian model of 100% inclusivity

    June 7, 2016 — 10:14 PM UTC by Lisa Shidler

    Brooke’s Note: Disruption is everywhere in the in the RIA business, with new attempts to automate and scale the delivery of fiduciary-laced financial advice appearing or evolving every day, it seems. Yet RIA custody — with its fat profit margins and ubiquity — has remained immune to anything but mosquito-bite-level damage from a host of entrepreneurs who have tried to drain the blood of mastodons like Schwab. Neither custody leaders nor the basic custody value proposition ...

    Mark Tibergien: That's probably our highest priority -- an API store.

    Mark Tibergien reveals big Pershing robo future as his firm partners with Vanare, SigFig and Jemstep -- and follows TD Ameritrade's open API lead

    In speech at St. Regis in San Francisco, the BNY Mellon RIA unit CEO says Pershing is taking a deeper robo plunge by signing on marquee names

    May 4, 2016 — 6:11 PM UTC by Brooke Southall

    Brooke’s Note: Just when you think you have Pershing figured out, you don’t. The clearing and custody unit does plenty in style and substance to give an observer the impression that the 220-year history of BNY Mellon is an albatross around Pershing’s neck. Cases in point are Pershing’s slow-to-the-starting-line approach to the robo race and its reliance on legacy-style integrations with some 250 software vendors. But now Mark Tibergien seems to ...

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