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Schwab moves to keep 3,500 desktop-bound RIAs from walking onto somebody else's cloud

Advisors with PortfolioCenter housed on a closet-based server can get on Schwab's titanic servers without giving up years of customization -- and, finally, get data through Schwab from multiple custodians

Author Brooke Southall June 19, 2012 at 4:02 AM
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Brian Shenson: That's a huge pain point for a lot of our clients.


Craig Morningstar

Craig Morningstar

June 21, 2012 — 3:07 AM

Why wait for Schwab or any of the other custodians to offer a cloud based solution? If they did, it would be limited in what it has to offer.

The days of old where Advisors had to purchase software, pay for training and employ staff to run is an old model that died in the past few years.

Fully comprehensive and unified solutions through a single provider offering 100% of everything in the cloud, sync with mobile devices, have full service and support….is the better way to do business.

A fully comprehensive cloud solution includes: CRM, lead generation, rebalancing, financial planning, trade order management, opportunities tracking, email and social media with complete archiving, complete ability to securely share emails, calendars network folders and tasks, fully automated and unified document management, choice of custodian and platform solutions (TDAmeritrade, Fidelity, Schwab, PAS, Genworth, Envestnet and SEI), asset aggregation services (ByAllAccount, Advisor Exchange and DSTFanmail), practice business development coaching, 85 fully support investment models (DFA, Russell, American Funds, Manning Napier, Federated and Vanguard), 4,000 separate account managers, Altegris, Thinkpipes, ability to build and host your own models, 3 unified managed account solutions, full 401k plan support and services, comprehensive compliance reporting, full support with custodians, 2 fee based annuity solutions, financial planning reports and support, access and ability to run 80+ performance reports, accounting services, automated disclosure document delivery, secure client portal, automated quarterly performance delivery, complete management fee administration and support, electronic client signature services, Infinata and Morningstar workstation, full transition support and training…..for IARs or RIAs.
Who offers this….Dynamic Wealth Advisors.

Peter Giza

Peter Giza

June 22, 2012 — 5:09 AM


Too little too late? Perhaps, but at least it’s something. RedBack has been offering it’s products in the cloud for three years and running and Schwab saw Microsoft Dynamics feeding PortfolioCenter and RedBlack all on one unified Cloud platform 2 years ago. Our delivery platform allows our rebalancing and trading products to operate on anything from a laptop to an iPad and droid tablets.

Let’s face it the 'cloud’ is the Internet being powered by the evolutionary process of innovation hardware and software design. Mobile devices have and continue to push the envelope, however data and work flows have always been the underlying current that, at an ever increasing speed, drives innovation along.

While I am happy to see that Schwab has finally moved in this direction it will be interesting to see how “open” this platform is. As of now, no custodial platform is open to third party product hosting. Even some large software vendors in this space are not as of yet open to this concept. However I do believe this risk averse thinking is quickly changing.

As far the comments wrt to “It’s still going to feel like a desktop solution” – so what? For some applications this is not a bad thing. And for those clever enough to understand just what can be done in the cloud, the desktopness can be driven away via published apps. RedBlack can deploy its application in three distinct fashions on through its platform provider; Remote Desktop; Remote Office and Published Application.

Something that RedBlack cloud provides that SaaS platforms cannot is individualized control over your data and its security. In a SaaS platform everything is multi-tenant. That means you not only share the hardware, but the software as well. In the case of a database this means that your data is part of one giant data warehouse. Whereas in the RedBlack model you share only hardware infrastructure. You own your database, your data, your Active Directory – its all yours and no one elses. There is no proxy by RedBlack for your private client data. Your data and your relationship with your client and your custodians is just that – yours.

Just how Schwab will roll out its cloud platform will remain to be seen. From our experience working with their current services based platform it seems to work for its clients. So what the real difference in operations remains to be seen by the industry. Its still a far cry from the streamlined data integration promises we’ve been waiting from since Project C was announced.



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