Morgan Stanley (the new truncated branding of still legally titled Morgan Stanley Dean Witter) has recently entered a strategic partnership with Advent Software in which the investment bank's financial planners will gain access to Advent's TrustedNetwork account-aggregation services, giving analysts a more complete picture of their clients holdings.
Betting that a well-rounded view of a client's financial picture is the key to sophisticated advice, Morgan Stanley is the fist major global-financial institution to join the network but Executive Vice President for Business Development and E-commerce with the Morgan Stanley Individual Investor Group James Tousignant says he hopes they won't be the last.
"Obviously we are hopeful that with our participation a number of other major financial institutions will also participate,' he says.
Morgan Stanley, which operates units covering securities, investment management, and credit services, is very interested in being cutting edge in terms of account-aggregation capabilities, says Tousignant, and the Advent deal should be seen in just that light.
In September, Morgan Stanley announced a deal with Yodlee which secured Internet and wireless services for clients to aggregate their personal holdings and investment accounts in one location, with plans to give the firm's financial advisors access to view aggregated financial-account information with their clients' permission.
Tousignant says that while the Yodlee deal does provides Morgan Stanley advisors with much needed data gathering, Advent TrustedNetwork will now supply additional streams of data and the analytics applications needed to transform that raw data into a detailed financial plan, complementing Yoldee's capabilities.
Tousignant provides an analogy: "Just because I can look at a quote for IBM, doesn't tell me much, it just tells me the current state of IBM; but to be able to look at a chart for IBM or to be able to look at some analytics for IBM or to look at some fundamental data for IBM or to look at the performance over time of IBM is multidimensional,' he says, "so this is really building on top of data."
Specifically, the suite of applications from Advent will include analytics and tools supporting portfolio tracking, asset allocation, financial-planning services and advice around aggregated assets.
There are also differences in the technology employed by the two firms. "Yodlee does it through screen scraping of Websites for institutions and Advent actually has a digital-secure interface where holdings data is delivered from the custodial sources directly into Advent's Trusted database," says Tousignant.
Though he would not discuss any specifics of the deal, Tousignant describes it as a "strategic partnership" with some initial solutions being made available to select financial advisors and clients, most likely at no cost, later this year.
He says that in terms of technology, there are a few important aspects to the Advent offering. The first is the database technology involved in the storage of information such as balances and holdings by financial institutions which inherently implies its availability in cyberspace for collection. The second is the construction of interfaces by companies like Yodlee and Advent to access that data, and the third is the Internet itself which allows for the transmission of that data to a central location like Advent's TrustedNetwork.
Without account-aggregation capabilities like those being acquired from Advent, Tousignant says, information collection is usually done manually on a case-by-case basis through the acquisition and examination of financial statements from multiple institutions. With Advent, Morgan Stanley hopes to make things easier for broker and client alike.
"It allows the financial advisor to provide better advice to their clients holistically, not only for assets that exist at Morgan Stanley, but wherever the assets exist," he says. "It's about setting out a financial plan and making sure that through that plan, through the information and tools the advisor and the clients are using, that we can help meet the client's aspirations."