Valspresso’s innovative automated money management platform disrupts this status quo. “We empower advisors and advisor platforms to deliver the same advantages of personalized, actively managed portfolios to mass market clients,” President and CEO Reginald Nosegbe says—“with less cost than a hedge or mutual fund.”
Regulatory and competitive pressures, coupled with accelerated profit margin compression—margins for broker/dealers have plunged 75 percent over the last decade—are forcing smaller players that typically serve the mass market to either consolidate or go out of business. To succeed, “brokers and advisors must innovate, differentiate and deliver increased value to their clients at low cost,” Nosegbe says. “This is precisely what Valspresso’s Automated Asset Management Program allows brokers and advisors to do.”
Valspresso’s solution, which automates the entire investment process, is designed to reduce investment complexity—while reducing investment risk and improving return for investors. In addition, it delivers a huge benefit for advisors and advisor platforms: bigger operating margins.
What differentiates Valspresso from existing robo solutions? Two things, Nosegbe says: “first, the investment management functions that we automate and second, the value that we deliver.”
Consider what most robo-advisors do: they automate the client intake and passive portfolio management functions. Clients get market risk and market returns; advisors get smaller margins.
In contrast, Valspresso’s Robo-Money Manager platform automates the stock selection and active portfolio management functions. This drives return while reducing risk and cost—allowing for differentiation and competitive pricing models that lead to margin expansion for advisors and advisor platforms—a win win for all parties.
Nosegbe points to the wave of global asset management firms that are shifting away from assets managed by individuals toward machines. A new report from JPMorgan supports this view, saying that quantitative investing based on software formulas is quickly replacing stock picking by highly compensated analysts and portfolio managers. Further highlighting the trend towards automation is a March 2017 New York Times article reporting that “At Blackrock, Machines Are Rising Over Managers to Pick Stocks.”
We are passionate about empowering advisors, using our automated investment technology, to deliver better investment outcomes to the mass market while improving their profit margins
This trend is accelerating. Ladenburg Thalmann Financial Services, Inc.—a publicly traded, diversified financial services company—is helping to fund ground breaking financial technology so that roughly 4,000 affiliated advisors can derive maximum benefit from the latest innovations—“innovations like what we’ve developed here at Valspresso,” Nosegbe indicated.
Nosegbe says “Valspresso’s nearly two decades of research and innovation which resulted in a U.S. patent and a suite of cloud-based automated investment technologies and strategies put us at a competitive advantage and at the leading edge of the industry’s shift to automation. Our automated investment platform has been validated via thousands of simulations back to 2004 and via live fund management for more than three years.” On top of that, “Valspresso’s platform is designed to scale easily, and at minimal incremental cost, to accommodate the effective management of millions of small accounts and billions in assets under management,” he adds.