The arrival of more international platforms will only benefit advisers and wealth managers if they are flexible enough to operate in the local jurisdictions relevant to the client.
The announcement of planned new platform entrants to the international adviser and wealth manager market is a positive move for advisers, who are aware how platforms have enabled advisers in domestic markets to develop revenue streams and value in their businesses.
With emerging choice also comes a challenge for advisers in selecting preferred platform partners.
International advisers are looking for solutions for their globally mobile clients that give their clients asset protection and access to global investment solutions, yet support their local needs and preferred investment wrappers.
No doubt many new entrants will be extensions of existing infrastructures developed for domestic markets, discretionary fund management (DFM) services or that sit inside pension and life bond wrappers.
The adviser needs to get under the bonnet and determine if they are truly global and can deliver to their local needs.
Time zones
A platform for international advisers and their globally mobile clients must do more than just add ‘international’ to the title.
Advisers will benefit as much from a service delivery mindset as they will the system solution.
For example, with advisers working across multiple time zones, it must be not only 24/7 web-enabled but offer support aligned to the adviser’s working day.
The starting point is to be truly multicurrency in portfolio reporting options, client bank accounts, security and fund currencies, trading and settlement and collection of commissions and fees.
Otherwise, unnecessary bank and FX charges may be incurred.
It needs to be open architecture in nature, with access to global funds, stock exchanges, alternatives and so on, with efficient market trading.
For buy and hold strategies, this will rarely require real-time security access but it should support efficient same-day trading and aligned settlement in all major markets.
Underpinning this functionality will be the back-office engine that maintains the client record and accesses the global markets.
While not the ‘sexy’ or visible part of the platform solution, this needs to be proven across multiple jurisdictions; otherwise issues may emerge down the line.
International advisers have internet access to a cacophony of investment data.
The platform is an opportunity to consolidate unbiased investment research, commentary and tools to the adviser desktop.
It is also a source of revenue for advisers, and should open up multiple revenue streams, some that may have been closed or concealed in the past.
Protection of client wealth
When considering the bells and whistles of the user interface, advisers should not forget to ask the questions that will give clients comfort their assets are secure and can be readily accessed in a politically stable and highly regulated domicile, with client assets and money segregated.
If the level of anti-money laundering checks/‘know your customer’ information asked of an adviser and client when setting an account up seem onerous, that is a sign the platform and its jurisdiction are taking their responsibilities seriously.
A feature of global markets is that the platform will invariably need to use subcustody partners and the adviser should understand whether ultimate custody is retained by the platform or passed to another counterparty.
