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How Quality Client Data Can Help Tell a Holistic Story

Ask yourself these three questions before choosing a data aggregator

Data is like drinking water—but depending on your data aggregator, it can be more like drinking from a fire hose or from a carefully poured glass of filtered water. When account data is more like the latter—precise, filtered, and clear—that’s when advisors like you can help clients thrive. 

Ask yourself these three important questions to make sure your data aggregator gets at the heart of the issue: data quality provided at the firm level. 

1. How actionable is your data?

For advisors, the cost of subpar data quality is high. It can lead to incorrect downstream data, which affects the advice you’re providing to your clients and can negatively impact important relationships. 

To reduce this risk, ask yourself: “Does my aggregator provide quality, reconciliation-ready data for my firm so I can take decisive, well-considered action?”  

Aggregators can’t reconcile data for you, but they can make it easy for you to reconcile on the platform of your choice. Rather than looking for data that claims to do everything for you, seek data that you can more easily act on, so you can provide streamlined performance reporting to your clients. 

2. How universal is your data?

You can break this question down into two parts: 

  • Can my data aggregator integrate with and populate any receiving systems with my financial data? 
  • What investment-account types does my data aggregator support?  

As financial institutions become more open to working with aggregators, it’s increasingly important for advisors to find a data aggregator that has strong relationships with these financial institutions. This makes it possible for you to effectively provide for clients who have a wide range of financial needs in a wide range of locations and situations.  

3. How versatile is your data?

Accurate account data makes it possible for advisors to understand clients’ unique spending habits, cash flow needs, and holdings. This understanding enables advisors to provide useful advice regardless of whether clients are looking to craft a goals-based financial plan, receive the latest performance reporting, or optimize their investment portfolio. 

With this range of potential situations in mind, consider if your aggregator makes it possible for advisors to provide a consolidated report of all a client’s assets—regardless of asset type, financial complexity, or custodian—in a timely manner. 

One way aggregators can facilitate this process is through machine learning, or AI, which helps them grow, analyze greater amounts of data, and become more intelligent. Morningstar’s technology has been analyzing investment data for 20 years, and this longevity has provided the technology with the time and quantity of client data it needs to effectively learn the nuances of normalizing data from thousands of sources. 

Find a data provider that meets your needs

Today’s investors are surrounded by disparate financial data that can cause confusion, unrealistic expectations, and uninformed decision-making. Against this backdrop, they’re turning to advisors to harness their data, evaluate their entire financial picture, and provide personalized advice to help them meet their goals and attain financial wellness.  

This environment means that quality data is more important than ever. It’s not a luxury, but a daily necessity that enables advisors to provide comprehensive advice to clients. 

This understanding is what drives Morningstar® ByAllAccounts®. The system gathers raw data from more than 15,000 sources and standardizes it into a single, consistent data model based on industry standards and Morningstar’s proprietary identifiers. It curates and enriches the underlying client account information and delivers institutional, quality firm-level client data in a timely, consistent, ready-to-use format.  

This year marks 20 years of ByAllAccounts delivering intelligent data to advisors, and our mission remains as fundamental as ever: to put investors first. 

David Johnson leads the Morningstar ByAllAccounts product group.

To learn more about the value of quality institutional data and how ByAllAccounts can help deliver it, check out our webinar.

For a deeper dive, check out our white paper, “Quality Client Data: Selecting the Right Provider.”
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