Scheduled to Go Live in Early 2021, the Integration Will Strengthen Transparency & Documentation Capabilities for Enterprises and Advisors
RiskPro and Envestnet, Inc. announce an integration which will enable investment advisors to build and manage client portfolios with less regulatory risk. The strategic relationship between the two companies will allow RiskPro’s proposal generation, portfolio construction, and automated risk surveillance software to function within existing enterprise workflows on the Envestnet unified advice platform.
“This is not just an important strategic relationship—this is something much bigger that will set a new, higher standard for investment account suitability and regulatory transparency,” said Nick Scalzo, Co-Founder and Co-CEO of RiskPro. “Working together, RiskPro and Envestnet have the opportunity to provide more advisors across the country with tools that help align client portfolios with each client’s individual risk tolerance—increasing the likelihood of meeting client expectations, while reducing the enterprise’s regulatory risk and liability.”
RiskPro’s Perpetual Suitability™ software (https://www.riskproadvisor.com/perpetual-suitability), which will be offered to Envestnet’s enterprise customers when the integration goes live in early 2021, helps advisors’ clients determine their own Personal Risk Budget™ (PRB) using a fully documented process that clearly defines risk in terms that clients can understand—maximum annual dollar gain or loss potential. Once a client’s PRB has been calculated, advisors affiliated with Envestnet enterprise customers can make investment recommendations with a 98% statistical probability that maximum risk tolerances will not be exceeded over any given 12-month period. This statistical probability applies to institutional model portfolios as well as to portfolios that investment advisors construct on their own.
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RiskPro’s technology allows each enterprise to set its own surveillance rules for monitoring the risk of a client’s portfolio, as compared to the client’s PRB, on a daily basis. Enterprise home offices and the advisors are alerted if the risk of a client’s portfolio falls outside of the surveillance rules set by the enterprise, and all steps required by the home office for realignment are well-documented.
“Our strategic relationship with RiskPro will strengthen the essential advice that enterprises deliver to clients, while empowering their advisors to help clients achieve financial wellness,” said Blake Wood, Senior Vice President and Director of Product Strategy at Envestnet. “We consistently seek ways to broaden the data-driven intelligence we can offer advisors, and RiskPro’s technology solutions help advisors at enterprises make better, risk-managed investment recommendations for investors. This is what makes RiskPro an ideal strategic partner for Envestnet, and we look forward to the launch of our integration.”
