Tech-Enabled Services | Upscaled Operations with Rendezvous Managed Accounts

Trading a book of business is a time-consuming task. Even with state-of-the-art rebalancing technology, the continuous stream of model changes, cash flows, transitions, corporate actions, dollar-cost averaging, and tax-loss harvesting opportunities demands awareness and oversight from the advisory practice. Many firms choose to build an in-house (or strong) operations team to ensure they devote daily attention to such a mission-critical task.

For a firm rebalancing on a quarterly schedule, often the teams are fully occupied for four to five weeks following each quarter close; in other words, over a third of their calendar year. The first two weeks may result in 80% of accounts being implemented, while the tail of complex accounts requires more time. These teams work through complex relationships one by one, often revisiting tax lots to determine the optimal rebalance within client constraints. For a more trading-savvy firm optimizing accounts daily, the additional context-switching may equate to over half of the team’s working hours on trading days. For a fast-growing firm, tax-aware portfolio transitions can double the amount of work involved.

New Managed Account Service

As the SS&C Black Diamond^® Wealth Platform continues to develop state-of-the-art rebalancing tools for advisory firms, we are excited to launch the Rendezvous Managed Account Service as a completely native outsourced rebalancing solution in Black Diamond’s Rebalancer.

This service combines the institutional expertise of our investment management and trading partner, SS&C ALPS Advisors, with a new Managed Account Program workflow in our Rebalancer software. Whether the need is to outsource trading for the entire book or have the convenience of a natively integrated small account trading solution, this tech-enabled service gives firms the opportunity to transition time and skillsets to more value-added activities.

Firms can increase efficiency and profitability in their practice by taking the talents of their Ops team upmarket with a cohesive strategy that focuses on tech-enabled services. By delegating trading and rebalancing to a managed account service provider, firms can redirect their Ops team towards profit-focused activities, such as prospecting, proposal generation, and paraplanning. This creates an interesting, combined benefit – another lever for firm growth and explicit career pathing for staff.

Automated, Personalized, and Tax-Savvy

As we continue to build out a differentiated outsourced trading solution in the Rendezvous Managed Accounts Service, these are the three core tenants:

1. Personalized Model Portfolios
   We believe in the value of customized and personalized portfolio solutions for end clients. We help firms focus on client objectives and target portfolio risk rather than a dogmatic approach to the inclusion of certain portfolio holdings. Our Managed Account Service solution supports third-party and rep-as-PM model portfolios designed by financial advisors in Black Diamond Rebalancer.
2. Thoughtful Automation
   Institutional quality portfolio rebalancing involves acknowledging the target model portfolio, tolerance bands, cash buffers, client restrictions, auto-allocate/request cash, and dollar-cost averaging preferences. All of these are considered holistically in the new Managed Account program. If a scheduled auto-request for cash is coming soon, our service aims to coincide tax-loss harvesting and cash management activity around the request rather than incur multiple trades and risk short-term capital gains.
3. Tax-Aware Optimization
   For taxable investors, the greatest cost of investing is taxes. Our tax overlay feature allows advisors to engage tax-aware optimization and asset location optimization in regular rebalancing to ensure their clients maximize after-tax returns. In addition, we expect to enable firms to assign their clients to Direct Indexing model portfolios as a part of the service later this year.

The SS&C Black Diamond team fully supports the variable needs for rebalancing and personalized solutions among and within advisory firms. With SS&C ALPS Advisors, a natively integrated partner, the Managed Accounts Services platform aims to expand Rebalancer’s capabilities to include more automated and sophisticated rebalancing capabilities. We look forward to introducing these capabilities to you and your firm. Click below to book an appointment with one of our sales engineers.

To learn how the SS&C Black Diamond Wealth Platform can support your unique advisory business, take the next step. Request your personal demo, call 1-800-727-0605, or email info@advent.com today.