Capture Clients’ Total Wealth Picture with First Rate’s Data Aggregation Solution
Although data aggregation has long been included in First Rate’s suite of solutions, our commitment to innovation and meeting the evolving needs of wealth managers are our primary motivations for enhancing our data processing and aggregation services. Learn the who, what, when, where, and why First Rate’s data aggregation solution is designed to solve the complex and changing needs of your firm and allow you to view your clients’ total wealth picture.
- What is Data Aggregation?
Data Aggregation is the “seemingly simple task” of collecting data from various sources. First Rate has done this for years as we have built interfaces to many of the supported accounting systems powering our client’s operations. While many of our clients have data coming into First Rate from a single source, a fast-growing set of clients are expanding the list of upstream data sources that power First Rate solutions. More and more often, clients are asking First Rate to process data from 5 structured sources as well as a couple of unstructured sources. With this, the “seemingly simple task” starts to get more complicated very quickly. Different input files, security details, and transaction codes all have to be gathered, normalized, quality checked, and supplied for performance or analytical purposes.
- What’s meant by Structured and Unstructured Data?
Structured data refers to data being passed into First Rate which is usually done in bulk, and the single bulk delivery will include all the data for the client’s portfolios. A typical example would be First Rate receiving 5 files each night – one with all the accounts, one for all positions, one for all transactions, one for a security master, and one for pricing. These files are consistent, have a lot of data, have no graphics or unnecessary add-ons, and are often the single supported version of file delivery that an upstream system will provide.
Unstructured data is the exact opposite. When thinking about unstructured sources, think about a PDF client statement from an alternative asset. This usually involves one client account per pdf document, there is no structure, and the data from one month or quarter to another can land in different document locations. These types of client accounts can still be processed and included in reporting or your own data layer using AI and machine learning technology.
- How can you make better use?
The vast majority of First Rate clients have data coming to us from a single source, but that same majority almost certainly is being tasked with advising on assets that are held outside their main system of record. The main goal we have is to help provide a consistent, clear, and complete client wealth picture. Many clients and prospects have appreciated the multi-custodial capability while never taking full advantage of that opportunity to provide a more complete wealth picture to their clients. More and more of our clients and your peers are pulling data in from various sources. Here are three trends as to why this is occurring:
- Important clients are refusing to move accounts to a single custodian or accounting system.
- Firms are purchasing or developing their own RIAs and the RIA account servicing firms offer greater flexibility to leverage and share data.
- The proliferation of “Alts for ALL” means that clients are choosing to place funds with alternative shops thereby necessitating some forms of unstructured aggregation.
If you have accounts that are held elsewhere, inquire about how to get them pulled into your existing client reporting engagement with First Rate.
Providing just part of the picture is the same as completing a puzzle only to realize 3 pieces are missing. You get the idea and you know what it is supposed to be, but those 3 pieces are going to dominate the conversation as opposed to how good it looks now that it is done. The conversation will be “looks good, but…” and not “looks good, now what?”
- How are our clients using it?
I have outlined several primary and common use cases; however, a couple of big reasons center around the proliferation of alternative assets. As these assets begin to take larger components of the asset allocation picture and are more frequently being held outside of the relationship manager’s immediately oversight, wealth managers are leveraging our services to pull these alternative statements and extract the necessary data in a timely fashion, accurately, and without adding headcount. Once extracted, the case often ends with including the data in First Rate supplied calculations and reports; the bigger opportunity exists to supply the data back from these documents so that it can be consumed directly into a research platform or data warehouse.
While the typical use case is to power ongoing, repeated collection of data, it is not uncommon for firms to request unstructured data sourcing projects in order to do historical conversions of client account history.
- How will it help with Digital Transformation?
In my opinion, digital transformation really means being more complete and efficient about how you can deliver data in a usable format. I can’t think of a business service that helps to solve and power this more directly than streamlined, outsourced Data Aggregation. First Rate has the ability to power complete and accurate pictures of your client’s wealth. In a digital world, clients demand this as table stakes. More importantly, this complete view will help you make better decisions, provide better guidance, glean insights, and power your ability to be a true steward of your clients’ TOTAL wealth picture.
For more information about First Rate’s Data Aggregation solution and how it can help your digital transformation in 2021, please contact Grayson Greer.
Patrick Flaherty, CIPM, is the Product Owner for CORE Performance and Integrations as well as the GM of Fee Manager. In addition to shaping the strategic direction and development of both products, Patrick is responsible for overseeing the operations of the Fee Manager business unit including developing and maintaining client and partner relationships. In 2011, he completed the requisite study and exams for the certificate in investment performance measurement (CIPM).