Controlling the Herd

CattleTrailThe Chisholm Trail became known as the primary route for moving cattle out of Texas to the Kansas Rail-heads in the 1800s. It is estimated that between 1867 and 1872 3,000,000 head of cattle were transported via that route. Can you imagine the challenges ranchers faced while trying to control their herds over the ~800 mile trail? I’m certain not all the four-legged “outliers” could be brought back in line with the herd.

Now come back to today and imagine your firm managing over 100,000 portfolios, utilizing different strategies, branches, and portfolio managers. Wouldn’t it be great to have a tool that enabled management control all aspects of its business and be able to research why certain accounts were falling out of line of their acceptable return range?

Controlling the herd would be easy.  Each account outside the strategy would be identified, researched and even rectified (if necessary). Accounts with returns in-line with the strategy but with higher risk exposure would be identified. Holdings not on the firms approved list would be exposed. In essence, the possibilities around controlling the “herd” would be extensive.

In today’s world of complex regulations, oversight and restrictions, management tools are invaluable in maintaining order. Investment Officers and those responsible for the investment process need to ensure that rules and strategies are followed so that their respective firms speak with one voice and not let the “herd” run rampant and without guidance. Therefore it is of the utmost importance to have an oversight tool that enables Management to examine its portfolios and safeguard the investment processes that have been developed.

Commons sense demands it and regulations dictate it. For more information about how First Rate is controlling the herd with our Management Oversight, contact info@firstrate.com.

First Rate exists to help wealth management companies grow and thrive as stewards of their clients’ investments. Our reporting solutions help financial firms create absolute transparency while empowering investors to simplify and better understand their financial world.

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