RiXtrema, a company that provides risk management tools and analysis to the financial advisory and broker/dealer community, announced the launch of its IRAFiduciaryOptimizer tool to help financial advisers document clients’ best interests and ensure compliant rollovers.
According to the firm, the new fiduciary tool is “the first software to quantitatively compare and convert existing retirement portfolios into proposed new, compliant portfolios comprised of securities approved by the independent financial adviser or broker/dealer.” The comparison highlights a variety of measures such as fees, track record of the investments, risk versus risk tolerance, and best fiduciary practices, RiXtrema explains.
“These might include investing in the best share class, as well as additional services provided by the adviser to the client,” the firm says.
The IRAFiduciaryOptimizer further produces a report summarizing why a rollover is in the best interest of the client based on the above-mentioned measures. Reports can be generated by individual advisers, or by a home office compliance team using an administrator portal to manage outcomes for all advisers/representatives with the firm.
RiXtreama adds that the service enables the adviser to quantify and document any savings, performance improvements, fiduciary best practices, as well as additional services available by switching from the existing portfolio to a portfolio comprised of the adviser’s suggested investments. Additionally, it allows the adviser to compare the risk/return profile of the original portfolio with the rollover recommendation, as well as show how it compares on metrics such as total fees, returns, risk, Sharpe ratio and fiduciary best practices. The IRAFiduciaryOptimizer is also fully integrated with the FinaMetrica risk tolerance system enabling compliance groups to create risk-appropriate portfolios, while fulfilling other fiduciary requirements.
The firm concludes that the IRAFiduciaryOptimizer can support such compliance work both at the individual adviser level and for an entire firm or broker/dealer, “with batch tools available to make thousands of portfolios compliant in a single process along with producing documentation that shows client’s best interest.”
More information about the fiduciary software solution is available online here.