Many financial service providers limit their investment advisory offering. They do it for economic as well as for compliance reasons. Some call this business even a regulatory “mine field” and have suspended it altogether. Is this self-imposed limitation really necessary?
Firms providing investment advice have to clearly define what actually constitutes advice. Under a contract, they have to stipulate where they can provide advice and where they cannot. And, they will have to explain how they can deliver an advisory service on an ongoing basis in practice. Naturally, firms will be reluctant to provide services for instruments which they cannot properly manage. This explains why customers may get less service for instruments they selected themselves in exchange for assumed protection. However, isn’t it most awkward to explain to customers that while a service provider adheres to the rules of compliance, there is still an area where they are vulnerable? Simply because the provider does not consider it its responsibility to oversee all of their customers positions – including those they selected themselves?
We propose to create an advisory ecosystem where various providers combine their ideas and their product catalogue on an extended shelf. A central team of content specialists shall manage the lifecycles of investment instruments and of investment ideas. The pure number of instruments or ideas should be irrelevant for this purpose. This is where technology and scalability come into play. Technology massively helps creating monitoring and optimization capabilities to regularly screen a large set of standards. The central team will be able to provide customizable services to the individual contributors to the extended shelf.
Distinga Advisory Solutions LLC supports the creation of an investment advisory ecosystem with its unique business approach. An approach that leads to more investment ideas and instruments to choose from.
For a smooth implementation of the Distinga Advisory business approach, we work hand in hand with Prometeia – a leading software solutions and data provider specializing in the digitalization, automation and compliance of advisory services. Prometeia was founded in 1974 as an independent institute for economic research by a group of university professors in Bologna. Most recently, a report by Forrester Research Inc. confirmed Prometeia as a leader in Digital Wealth Management Platforms.
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