News Archive
APCIMS magazine Smart Reporting
23 May 2010
PortreportWhen markets are moving at speed, either up or down, clients’ need for information on their investments is paramount. Falling markets in particular stimulate such a demand. During the market turmoil of 2008, many firms found their clients’ biggest concern was an inability to obtain accurate and up-to-date valuation data. To meet this demand, a firm has to produce not just the right information, but have it presented in an easy-to-read, comprehensive format that is consistent in appearance and duration for all clients.
Fortunately, the technology to produce such quality material in electronic and printed formats has become available over the last decade, but now clients’ needs have developed further. With advances in mobile phone technology, smartphones play an ever-increasing role in the busy lives of high net worth individuals. In 2010, smartphones like the iPhone, BlackBerry and Milestone, contain considerably more computing power than a laptop of only a few years ago. Instant access to the internet is easier than ever before so to have portfolio information available in any place and at any time, on a smartphone has obvious appeal. Technology to enable this has now become available.
There are some important considerations that must be factored into such a facility. First and foremost it must be secure. Information should only be available to the individual for whom it is intended. This is achieved by the use of various permissioning techniques, including user name and password. Further security and anonymity can be achieved by the smartphone’s report being addressed to an alias of the client’s choice.
Given the size of a smartphone, it is most suitable for supplying summary information only, with full detailed reports still provided in print or electronically to a PC. It is, therefore, important to have consistency in the content and style of the full report and summary information on the smartphone. This will present a professional corporate image for the firm and help clients to find their way around the reports in a fast and efficient way. More than that, without consistency, the investment manager may experience an increase in the number of incoming phone calls where clients are querying what seems to be incompatible information. This is a waste of investment management and client relationship time. Rather than fielding calls from clients questioning inconsistent information, time could be spent initiating constructive dialogue with clients regarding a new investment idea or a tax mitigation strategy. To ensure the required level of consistency, the mobile financial reporting application would have to be an integral part of the core reporting system.
The very nature of mobile reporting means that the most up to date information must be available instantly, pushing the expectations of clients to have more immediate reports available at all times. In the future, it will not be acceptable for reports to be "as at the end of last period", or even the position at end of the previous business day. Clients will want the ability to look at the current position at the time they make the request, especially when the markets are volatile. The core reporting system must, therefore, be able to provide this.
Fulfilling this requirement, cannot be achieved by teams of experienced MS Word operators hand-crafting elegant client reports on an ad hoc basis. It needs the reporting layer to be integrated with a firm’s back office system or database which holds current client positions. The reporting engine itself needs to be extremely efficient. Only then can reports or report summaries be produced en-masse in real time and in a prescriptive format.
The volume of information that can usefully be received on the small screen of a smartphone is limited. It typically lends itself to providing updates on positions, effects on a valuation and knowledge of an exposure. This is also the type of information that a client would want to keep track of in times of market volatility. Then regardless of where the client may be in the world and what the local time of the day it may be, that client may then want to send instructions to their advisor or to the market so that certain actions can be undertaken, such as selling out a position or purchasing additional stock. This level of interactivity should be available within the application.
With real time, up-to-the-minute portfolio reporting, brokers and wealth managers together with their clients will be able to react to immediate market conditions coming through on the news or to a change in personal circumstances. They can also verify that a particular event or transaction took place. Overall, they will have an edge and control they have never had before.