By Cosimo Violati
Business Developer, Altoo AG
Transparency is a challenging attitude that is necessary in organising and monitoring family wealth. But what to do if investment data might not be available or presentable in wealth reports? Our Altoo wealth aggregation platform gives a clear answer.
While developing our digital platform, supporting the beneficial owners was a central question for us. The principals making investment decisions and creating a wealth legacy are the essential subjects in the whole process.
Why to choose Altoo Platform?
By using a range of technology tools, our digital platform improves decision-making by providing an intuitive digital overview of one’s wealth. Let´s give an example. Our average client has CHF 100 million; it ranges from CHF 20 million to more than CHF 1 billion. He or she wants to have a full picture, within a click of a button, of what’s going on in his or her wealth portfolio. On Altoo, he or she can look at all of his or her fund positions and custodians and compare expenses over the return of that fund. How much exposure does she or he have to specific banks, and within those banks, what assets does he or she own? Is it a lot of cash, securities, etc.?
If the client was using a multi-family office, he or she would need to wait for that information to be sent. It doesn’t allow for fast decision-making. In contrast to that, our Altoo platform is providing a good compromise, a personalised system that provides a clear picture of one’s wealth. Thus, UHNW individuals and small family offices can experience a unique digital adventure through wealth management.
What are the Platform Functions?
Everything from realised and unrealised P&L to income, expenses, and inflows is presented to the user via a personalised dashboard. Users can build their own reports by slicing and dicing investments, for example, to determine one’s exposure to tech stocks within a broader equity portfolio. As well, they can look at bank expenses. How are they being charged over the course of the year, compared to other banking relationships used by the family? The platform offers different angles of view. Moreover, this new private equity module has recently been added to the platform to enable clients to view fund IRRs, fund distributions, J-curves, exits, etc.
Because liquidity management is vital, a future liquidity cash flow reporting function has been added. He or she can add any investments to the platform to monitor the liquidity over time. It is useful for monitoring capital calls; also, art, cars, or any collectibles or types of assets are covered.
What can the User see immediately?
From the beginning, our aim was to help clients manage their lifestyle and investments by always having a clear view of their wealth. Altoo users can conduct transaction cost analyses on their portfolios to better understand the impact of transaction fees. This is achieved by considering all of the expenses to present a more accurate view of performance. Fees might be a small percentage of the total investment, but over time they accrue and erode performance margins.
The improved speed of decision-making is made possible by having an immediate visual indicator on the platform elements. For example, a real estate indicator shows how over or underallocated one is relative to a prescribed target allocation. Thus, tracking and monitoring asset class exposure over time can be done easily. If going below or above that target, the user will get notified via the Altoo mobile app on the phone and issued with a call to action. If wished, the investment rules to receive alerts can be set, i.e., in case the user would like to be notified when a specific drawdown from an investment account has occurred.
What are the Costs?
Whenever he or she buys or sells stocks, bonds, fund commitments, property, etc., all of the data sits within the platform’s private cloud environment. Users can easily review historical performance and build a digital wealth legacy for the family, incorporating every element of its investment portfolio. The collaboration tools allow access rights to be given to third parties working with the family. Lawyers and other external advisors can thus support the functional operation by including an internal communication tool. This helps avoid reliance on public email servers and other open communication channels where privacy is hard to control.
From a cost perspective, Altoo does not consider the size of the client in terms of net worth. The determining factor is the number of banking relationships. The software comes with a yearly licence fee, which can vary depending on the modules selected. If he or she has bank relationships, this implies an additional annual fee. Its range is determined by factors like transaction frequency and the complexity of the client’s assets, such as standard cash accounts, stocks, and derivatives.
In Altoo, we know the importance of security. The highest data security standards are upheld. We are using our own room in a secure data centre in Switzerland, and the platform operates within its own private cloud. We also use our own encryption modules and maintain everything. We don’t outsource anything. From client servicing to development, everything is done in-house. Thus, the Altoo wealth platform is a quick and secure way to access the data, providing a unique opportunity for small family offices to manage the wealth legacy.
