Our Modern Problems Need Modern Platforms blog series explores how next-generation wealthtech moves beyond the limitations of legacy tools. New to the series? Catch up on Part One and Part Two.
The adoption of alternative investments rises with wealth. Goldman Sachs found that 39% of households with $1 to $5 million in investable assets use alternatives, compared with 63% of those with $5 to $10 million and 80% of investors with more than $10 million.
Yet a gap remains between owning alternatives and talking about them. Only 41% of advised investors surveyed said they had discussed private markets with their wealth manager.
The Complexity Behind Alternatives
Alternative investments can introduce different liquidity considerations, valuation schedules, reporting requirements, and data sources. The challenge for wealth managers is not simply tracking each investment, but understanding how it fits into the client’s overall financial picture.
When alternatives sit apart from the rest of the portfolio, that context can be harder to see. Wealth managers may have the information they need, but not in a holistic or easy-to-share format.
Connecting Alternatives to the Portfolio
The goal is to simplify how alternative investment data fits into the broader portfolio, and this is where integrated technology can make a difference.
By pairing SS&C Black Diamond® Wealth Solutions and SS&C Accord, firms can bring alternative investments into the broader portfolio view. SS&C Accord aggregates and processes alternative investment data, helping firms manage the specialized work involved in collecting statements, tracking transactions, and maintaining data. That information can then flow into Black Diamond portfolio views and reports alongside traditional investments and power household and aggregated performance reporting.
This approach has earned industry recognition. Datos Insights named SS&C Accord, with its seamless integration into Black Diamond, a best-in-class solution for alternative investment document and data management.
The impact can be significant for firms managing complex portfolios. One Florida advisory firm used SS&C Accord to bring seven years of historical alternative investment data into Black Diamond. Since onboarding, the firm has grown its account volume by 400% and now services more than $420 million in alternative investments, while expanding its reporting to give clients a more complete picture of their assets.
When alternative investment data is connected to the broader portfolio, wealth managers can spend less time gathering information from different sources and more time using that information to serve their clients.
A consolidated view can also help put alternatives in context. Wealth managers can see how private and public investments fit within a household portfolio, creating a stronger foundation for conversations about portfolio construction, diversification, and liquidity.
Bringing It All Together
HNW clients increasingly expect a more complete view of their wealth, including both traditional and alternative investments. Wealth managers need that same complete picture to have more informed conversations with their clients. Modern wealth management requires technology that connects the different pieces of a client’s financial life without adding complexity.
Alternative investments may require specialized processes behind the scenes, but they should not create a fragmented experience. By integrating alternatives into their technology stack, firms can turn complex investment data into a more connected client experience.
To learn more about how modern technology can support the growing role of alternative investments, download our eBook, The Modern Portfolio Era.
To see how SS&C Black Diamond Wealth Solutions supports alternative investment management, request a personalized demo, call 1-800-727-0605, or email info@sscblackdiamond.com today.
