Increase your Discretionary Asset Management business through rebalancing of client portfolios

In addition to defining the target share, FA Platform now allows you to define minimum and maximum “thresholds” for each position in your plan. These thresholds provide our clients with tools for rebalancing and limit analysis; FA users can now rebalance a position when it’s outside the thresholds, or create a limit definition based on thresholds.

Our clients can define a minimum and maximum share percentage for each position in their clients' investment plan or model. This allows them to define a plan with for example a target of 10%, the minimum threshold being 9% and the maximum threshold 11%. Thresholds are validated, ensuring they align with the user’s target share. FA’s rebalancing function filters out small orders if the position is within thresholds. So, the rebalancing parameters now allow our clients to filter out orders if their position is within the min/max share. This allows them to define per position how much they allow it to fluctuate, and to rebalance the positions that are outside their thresholds.

FA users can now also define limits that analyze their portfolio against the minimum and maximum shares in their model portfolio, investment plan, or strategy. If the limits fall within the minimum and maximum percentages it is marked OK and Breached if a position is outside the thresholds. In addition, you can define the thresholds manually in the limit as percentage points or total value.

”Rules” are a powerful tool in the FA Platform to adjust the system to function according to the client's business requirements. Rules can be used to automate settings values to contacts, portfolio, transactions, trade orders, and securities, every time they are modified in the system. You can, for example, automatically calculate transaction fees, change trade orders status based, initiate payments, etc. The basic idea of a rule is to check the target and its attributes and based on the conditions, trigger a consequence.

However, maintaining these rules usually requires a programmer to make a concept that might adapt poorly to the ever-changing business environment. The FA version 3.8 introduces a possibility to manage these business rules via Excel, which makes managing the rules more approachable and transparent. For example, this approach allows you to maintain transaction fees based on a price list more easily.

FA’s rule engine now supports Decision tables, allowing developers to create business rules in Excel instead of programming. Creating a rule still requires some programming knowledge but the majority of the rule can be defined using Excel tables. This also makes the rules more understandable – just open Excel and read through the rule.