If you find yourself in this situation, then it’s time to adopt rebalancing software in your practice. The real world cost savings to your clients from this feature alone will generally pay for the software several times over! To give you an idea of how this feature works, I’ve included a screenshot of the TradeWarrior Security Model screen (fyi, this feature is also available in our Class and Model of Models).

In this screenshot of the Model, you can see that we have three columns for location optimization settings, namely Roth IRA Rank, Tax Deferred Rank, and Taxable Rank. I’ve sorted the screen on the Tax Deferred column, and you can see a ranking from 1 through 8 on some of the Securities in the Model. The ranking system places a preference on those Securities to be placed in the respective account type. The program will work through the rankings by placing those securities in that account type until either the rankings have been satisfied or the account runs out of available cash.

This feature allows you to very easily take advantage of location optimization savings for your clients with very little effort on your part. Your only job is to enter your location preferences on the Model screen. The program will take care of the rest! If you’d like to learn more about this feature and the other features available within TradeWarrior, please contact us today.

As you enter this Directed Trade into TradeWarrior, it will query the database for all accounts owning Apple and generate the Sell All order for Apple, and generate a Buy order for Exxon with 50% of the proceeds while letting the rest go to Cash. The example I gave you is very simple, but there is no limit to the number of Securities you can enter on both the Buy and Sell side of the Directed Trade.

Now some of you may be saying to yourselves, “So what. I can do simple security swaps directly at my custodian, so why would I need this?” Here’s why: Rules and Trading Restrictions. The beautiful part about running your Security swaps through TradeWarrior is that it will check the trades against all your settings and restrictions you’ve put in place. To name a few: Do Not Sell restrictions, Trade Minimums, Account Cash Minimums, Client Trading Statuses, etc. That way you never accidentally sell Joe Client’s Apple stock that he instructed you to not sell because he has a low cost basis on it. We’ve found that many of the advisors we work with typically only run a full rebalance maybe once or twice a year, but make several security swaps throughout the year as they come across opportunities. With the Directed Trading feature, they can make these tweaks to hundreds or thousands of accounts in under an hour.

TradeWarrior provides the tools to take advantage of trading opportunities as they present themselves! Many advisors who don’t utilize rebalancing software are often overwhelmed with the prospect of making swaps like this. It might take them several days to work through all the trades manually, and by then sometimes the opportunity has passed. If you are still rebalancing manually, I invite you to schedule a short online demo of TradeWarrior to see how much time it can save you in your practice.

Now, onto the AUM fee. We know you hate it. As advisors, we hated it. We often thought to ourselves, why should my software company charge more if I increase my assets? Initially, Nine Mile was not going to charge an AUM fee for Trade Warrior, but once we were on the other side of the table we changed our mind. The reason we decided to stick with the AUM fee model is because it allowed us to charge less to the smaller shops and more to the bigger shops who get more utility out of the software and have higher demands of the software, including support costs which is the doozy. If we charged one flat rate, we would have to charge a much higher base price to make money on our software, which effectively hurts the little shops and rewards the big shops. The other idea we considered was charging for seats (i.e. number of licenses). However, we hit a roadblock with that idea as we found that in this scenario most advisors would just buy one license regardless of whether they were a lone $30M advisor, or a large $800M advisory shop who had one staff member dedicated to trading. Unlike most software, rebalancing software is highly specialized, and thus not necessary to install on every computer in the office. So this brought us right back around to charging a flat price. Going back to our original business thesis of building affordable rebalancing software, the AUM fee was an effective way to even the playing field for everyone and make our software affordable whether big or small. Hopefully this explains our position on why we charge an AUM fee. We struggled long and hard over this, but in the end it made the most sense. If you have an alternative idea, we’re all ears-

Now that you know our pricing and don’t have to call us for a quote, we invite you to schedule a 45 minute demo with us to see the functionality of TradeWarrior and how it can work in your practice.