Utilizing Management Software For Order Flow Across Multiple Custodians

Managing order flow across multiple custodians have become increasingly important as technology continues to rapidly evolve.

For an industry of over 12,000 RIAs in the US who managed over $70 trillion in client assets in 2018, offering a variety of custodial options is the norm. Multiple custodians not only offer specialized services, but keep portfolio rebalancing platforms current with up-to-date integrations. They can also help advisors’ offerings stand out and create stable and secure partnerships for their clients.

Today, the best known custodians for independent advisors include Fidelity, TD Ameritrade, Charles Schwab, and Pershing Advisor Solutions. Michael Kitces of Nerd’s Eye View provides a breakdown of the Big Four firms.

According to Kitces, the providers’ “sheer size and market reach” means they already have the core technology advisors need. But each custodian has its own area of focus. A new range of second-tier custodians also work independently, or in some cases alongside, the Big Four.

Kitces advises taking a thorough look at the technologies, investment options, and how good a fit the core offerings are for your business and clients. “But the key point is to acknowledge that no single custodian is best for all advisors,” Kitces stated in his blog. “It is worthwhile to try to figure out upfront which custodian is the best for you, and not just in the short-term, but ideally in the long-run too!”

But with an increase in options comes a different challenge: managing order flow across multiple custodians. Managing multiple custodians and running trades without a single system can cost efficiency and time. Offering clients a variety of options will not serve well if there is no management system to maximize effectiveness.

Managing Order Flow Across Multiple Custodians

Once you understand which custodians will best serve your clients, identifying the appropriate system to manage trading across custodians is an important next step. Some of the features to look for include:

  • Electronic execution. Automated execution maximizes the efficiency and consistency of the trading process. Clients and advisors should be able to track performance and analyze historical trades. Having an internal accounting system that provides accurate calculations will keep trades secure and consistent.
  • Order management. Trading strategies that are able to be implemented quickly and accurately. Order management streamlines the process of trade creation, validation, and execution across multiple custodians. It also guarantees that trades consistently meet all account-specific requirements to achieve quality executions.
  • Seamless integration. It takes more than multiple custodians to run an advisory business. Accounting systems, trading networks, and other partner integrations should connect seamlessly and automatically. A cloud platform can offer more integration flexibility, a wider range of options, and more intuitive user experience.
  • Full support. A multi-custodian management platform should offer a support team for regular upgrades, and server maintenance. They should also be available via multiple platforms to handle any user questions that arise.

Managing Multiple Custodians With Blaze

Blaze Portfolio has the tools advisors and traders need to support their workflows and ensure accuracy. We offer real-time trading with the Big Four and hundreds of simple, fast, and automatic partner integrations. Our streamlined platform manages order flow across multiple custodians, asset and security classes.

Learn more about how Blaze’s execution and management systems can enhance your business with a personalized tour of our software.


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