Portal To Intuitive Risk Management

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Technology

Michael Smith | April 4

At StratiFi, our mission is to provide financial advisors with better tools to manage risk. That focus inspired the creation of StratiFi’s Advisor Platform. Our platform is intuitive, clear, and places the complex logistics of pricing options, managing positions and executing option transactions behind a great user interface.

The platform focuses on two of the biggest goals for a financial advisor: protecting and growing client assets and differentiating his/her business.

Protection and Growth of Client Assets:

We believe analysis of portfolio risk is the first step toward protecting and growing a client’s assets. By using our proprietary risk analysis tool, PRISM, advisors can identify hidden risks in his/her clients’ portfolios. Using PRISM is as easy as uploading a CSV of a client’s portfolio and clicking a button to run the analysis, or by linking PRISM to a custodial platform, which will automatically analyze all linked accounts.

Interpreting the results is equally simple. PRISM breaks risk down into four easy to understand buckets: volatility, tail, correlation and single stock concentration (for more on that read our post about how PRISM assesses risk). We rank each type of risk using a score of 1 to 10 and add a simple color coding scheme to emphasize severity. Between our four risk buckets, ten-point scale and simple color coding, we think we’ve made comprehension of risk as telegraphic and intuitive as possible!

The strength of PRISM is that the intuitive logic translates directly into actionable insights for investment decisions. By understanding the source of the risk, it’s simple to apply the right overlay solution to mitigate that risk.

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Sample summary result from StratiFi's PRISM Tool

Practice Differentiation:

To help advisors bring StratiFi to their clients, we created a special tool that turns the PRISM results into a unique client proposal. The proposal lays out the risk in the underlying portfolio and explains the customized StratiFi solution that will work to minimize the risks identified. The proposal generation system can be entirely white-labeled, allowing the advisor to add his/her firm’s branding. That way, when the advisor takes the proposal to his/her clients, it will look like a familiar piece of communication from his/her firm ensuring the service becomes a unique offering that the firm provides their client.

Our risk analysis process and proposal generator are only two of the many things we’ve done to make StratiFi a crucial tool for advisors. We hope you see for yourself!

To learn more about the truth behind asset correlations and volatility, click here for our complimentary eBook "The Five Myths that Put Portfolios at Risk: Revealing the truth and improving investment outcomes using options."