Asset management is quite involved, as it has legal ramifications and requires considerable administration. For businesses that wish to offer an asset management solution as a wealth manager or investment entity but do not want to get lost in the details, a turnkey asset management program (TAMP) may be the right solution. In this article, we look at what it is, what types of businesses use them, and which might be recommended.
What Are TAMPs?
Companies may or may not be directly involved in the investment management business. Similarly, their advisory business could be quite small with management being keen to avoid getting lost in the tall weeds.
A turnkey asset management program is designed to ease the strain. Instead of needing to create a financial backend management solution including back-office investment support, fund research, asset allocation management, and billing, this is all included in a TAMP service.
The idea with TAMPs is that they allow firms to avoid regulatory concerns because they’re using a service where that has already been worked out ahead of time (no reinventing the wheel). They’re then free to focus on the other parts of their business.
What Type of Organization Makes Use of TAMPs?
Smaller investment houses are likely to use a turnkey software solution when their workforce is insubstantial, making creating a proprietary system impractical. Even larger mutual funds and investment trusts may use an existing one or have a custom or modified solution created for their purposes to avoid needing to start from scratch.
Financial advisors may use a TAMP under certain circumstances. There are SaaS and other solutions for advisors to provide billing and related services if they don’t need all the features of a full-blown TAMP. Nevertheless, some advisors with a degree of overlap may find the need for a more advanced solution eventually to cater to more clients, offer a branded investment solution in-house, or for another reason.
What TAMP Is Useful?
It’s always a good idea to go with a provider that offers different software solutions, instead of just one. The former can leave a client a little too boxed in, whereas the latter allows for the migration of data to their higher-end solution or one that’s tailored to a different audience.
One example is redi2, which offers billing and client relationship management solutions for advisors and wealth managers. They also offer a solution to investment managers focused on larger clients for managing institutional relationships on the billing side.
Are TAMPs the Answer?
Software is going to make business operations less problematic. It’s far easier to use a solution that has already been beta tested and put through its paces rather than suffer through a couple of years of trial and error to get to the same place.
For companies wanting to expand their business but not the level of complication, using a TAMP or even software that takes over just part of what would be involved is one less headache to deal with. And who can argue with that?