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Fidelity Mobile App Lets Advisers Take it all on the Road


The tech team at Fidelity Institutional Wealth Services has come up with a new smartphone app that allows independent financial advisers to open client accounts and electronically trade for clients from anywhere.

"What we've done is expand the capability of the system we introduced in February with the next step in evolution," said Ed O'Brien, senior vice president and head of technology at Fidelity Institutional Wealth Services,

In February, the Fidelity's first app for iPhones and Android phones, for its Wealth Central platform, allowed advisers to remotely access client accounts and respond to client questions. But the advisers were unable to trade from the phones.

"Now, with the new system introduced today, they can trade on those accounts and even handle multiple accounts," O'Brien said. "And we have something that's really unique: The adviser can even access accounts in a client portfolio that are outside of Fidelity. It gives them the same level of integration that they have with the system they use in the office."

O'Brien claims that security on the remote system is high. "There is no data stored locally on the smartphone, and it uses the same 'token' technology on the device that we use in the office, where there is a challenge question and also a one-time pin to use," he added. "It's an added layer of protection when they're trading for a client's account."

Whether a trade is placed via the smartphone or in the office, the trading records are tracked and recorded the same way. "It's all one system with different access points," O'Brien said. "In fact, in the pilot program, advisers told us that when they were on the road, they could even see trades placed in the office."

 

Morningstar Adds Analysis

To Institutional Platform

Morningstar has added sophisticated asset allocation and forecasting functionality to Morningstar Direct, its investment analysis platform for institutional investors.

Based on its own research and that of its subsidiary Ibbotson, Morningstar's new tools take into account "fat tailed" returns and measure downside risk.

Mean-variance optimization (MVO) and traditional modern portfolio theory have been the standard for creating efficient asset allocation strategies for more than 50 years, Morningstar said, but these cannot take into account "fat-tailed" or extreme market scenarios. Further, Morningstar said, this framework can only optimize asset mixes for one risk metric (standard deviation) and one reward metric (arithmetic return).

The new asset allocation capabilities allow investors to choose from a number of return distribution assumptions, including traditional bell-curve shaped returns as well as "fat-tailed" and skewed distributions.

"As the markets have shown-and reminded us most harshly again in 2008-real-life finance is often more complex than the traditional mathematical models used for portfolio optimization and forecasting," said Xianhua Xia, president of institutional software at Morningstar. "Our new asset allocation functionality offers institutional investors a flexible tool to enhance and refine traditional mean variance optimization.MME \