Autopilot, a lower-cost solution that allows advisers to combine client self-service capabilities with personalized service, mixes investment management by CLS with Risk Number technology from Riskalyze.
According to Aaron Klein, chief executive at Riskalyze, the Autopilot platform has been in testing for the last two months, with 500 advisers signed up. The technology helps advisers democratize access to their advice, Klein says, noting that the scalability of the technology can be a boon to advisers who serve 401(k) plans. “They can profitably serve those account holders with smaller assets,” Klein tells PLANADVISER. “It will demolish the barrier between smaller investors and access to the advice they need to thrive.”
Klein notes that Autopilot dovetails nicely for rollovers of any size. “It gives advisers a very next generation platform to profitably roll those accounts over to another asset management strategy,” he says. “A lot of advisers serving 401(k) plans are only focused on the 5% of participants with outside assets. Now every participant can be a great prospective client, no matter the size of assets.” The minimum account balance is $5,000.
What makes the difference is the use of Riskalyze’s technology: Autopilot helps the investor to invest based on (LINK!) how much risk they’re comfortable with. “The data is very clear,” KIein explains. “If they’re invested that way, they stay invested and do better over the long run. Also, clients will always be able to see where they’re at. It’s a powerful way for a traditional adviser to instantly provide the same set of tech services that online services offer.”
NEXT: Autopilot puts live advisers on equal footing with robo advisers.
“It’s giving the live adviser the platform to beat a robo-adviser at its own game,” Klein says. With easy, 24-hour technology, clients have constant access for simpler transactions. He notes that he himself doesn’t always want to talk to a person. “I’d rather click through while I’m multi-tasking,” he says. “But when the going gets tough, I would really prefer being with a firm with people I can contact, and I don’t want to be just a number. This way, advisers get to give their clients the best of both worlds.”
For simple transactions and phone-based assistance on withdrawals or transfers, investors have access to a help desk staffed by CLS Asset Management, which does trading and rebalancing of accounts, helping advisers drive down costs.
The adviser’s cost for Autopilot is 25 basis points. “Every adviser is going to be different in terms of service," Klein says. "They can set fees wherever they want, but the cost is 25 bps, and includes the technology, asset management and client service all built in."
CLS Investments, in Omaha, is a third-party money manager and exchange traded fund (ETF) strategist. Riskalyze, in Auburn, California, is the innovator of the Risk Number, a quantitative way to pinpoint investor risk tolerance.
More information on Autopilot is on the firm’s website.