Our Investment Advisory Software

aixigo’s investment advisory software supports your advisors in the advisory session with the clients. The investment advisory financial software modules provide an API-based construction kit that makes all steps of the advisory process highly efficient and fully compliant with regulation. The long-term use of our investment advisory software by our clients proves our practical and regulatory compliant quality - a reliable choice! The massive increase in efficiency resulting from digital and automated investment advice and its processes (such as the documentation of an investment advisory session) finally enables you to focus on the client again and also on the advice. This is how modern financial software should work.

Capabilities of the Investment Advisory Modules

aixigo’s investment advisory software offers many tried and tested modules that can be combined according to your needs for investment advice in an efficient manor while conforming to regulatory requirements. For example, with the help of a workflow that supports the advisor, relieves them of tedious and time-consuming tasks, and creates more time for client contact. Below we will give you an overview of our functionalities within the scope of an investment advisory software.

Advisory Workflow

The Advisory Workflow in aixigo's investment advisory software guides the investment advisory process and actively supports the advisor during the advisory session, in the preparation and follow-up. The Advisory Workflow also ensures that the advisory contains all the necessary components to comply with regulation. Decisions made and documented justifications are archived in an audit-proof manner. 

The workflow guides the advisor through all steps of the advisory process, such as

  1. registration or legitimation of the customer
  2. recording of the advisory risk profile including knowledge & experience and investment strategy
  3. analysis of the investor's situation
  4. present an investment recommendation or various recommendation options
  5. explanation of the recommended products and backgrounds
  6. if necessary adaptation of a recommendation by client's request
  7. final choice of the products
  8. documentation of all decisions, if necessary with justification
  9. create transaction orders

The workflow provides functionalities that are helpful for the advisor along the advisory process:

  • Advisory Trial 
    In preparation for the advisory session, the advisor can run through the process in a trial run. In this mode, neither compliance nor customer records are created.

 


 

  • Library
    Holds a wide range of documents, ready for retrieval that can be useful when conducting advisory sessions, but the inclusion of which is not mandatory. If necessary, the advisor accesses the library and uses the documents that support their sales story without media discontinuity. These documents can then be made directly available to the client in their mailbox.

 


 

  • Shopping cart
    Collects all products that a client is considering purchasing. The shopping cart items can be edited and removed. Finally, a client order in the form of transaction orders is generated from the shopping cart. 

 


 

  • Approval process
    Within the investment advisory software the Advisory Workflow automatically provides a complete and regulation-compliant documentation of the investment advice. In addition, the quality of the advice can be checked using this documentation in a 4-eye review. The advisory documentation is not yet delivered directly to the customer. Instead, the system draws the auditor's attention to the open approval process. If necessary, the auditor can provide the document with comments, which in turn is presented to the advisor, or approve the documentation. The process workflow allows rapid checking and transparent adaptation of the documentation.

 


 

  • Documentation Centre 
    The Documentation Centre collects all documents created or used in the course of the advisory session so that they can be bundled and placed in the customer's mailbox. In addition to the actual advisory documentation, these can also include documents such as product information documents. 

 

Portfolio Scorecard – the Qualitative Evaluation Module of the Investment Advisory Software

The Portfolio Scorecard is a tool for the qualitative evaluation of a customer portfolio on the basis of a target-actual comparison. It is used in portfolio construction and in the calculation of optimisation recommendations for existing portfolios. As part of the investment advisory software it monitors the conformity of the portfolio with customer-related, portfolio-dependent or bank-wide defined specifications as well as legal guidelines and can also be called up for a portfolio at any time. In the target-actual comparison, pending transactions from orders or payment orders can be taken into account.

Checks for suitability, appropriateness and target market are undertaken within the investment advisory software. The module uses qualitative evaluations to automatically ensure that investment recommendations only contain suitable and appropriate products for the individual client.

Verifiable restrictions

  • Target market
    According to legal guidelines, the suitability for the target market must be tested per product or optionally at portfolio level. The definition of the target market asks for customer type, knowledge and experience, loss capacity, risk tolerance as well as customer goals and needs. The actual values for the comparison can be provided by system functionalities such as the Advisory Risk Profile or obtained from external systems.

 


 

  • Target allocation
    The desired composition of a portfolio is its target allocation. The target can be defined, for example, from shares in certain products, components or model portfolios, structures such as asset classes or regions, themes, or also algorithmically on the basis of the advisory risk profile or suitability. Tolerances can be used to show when there is a significant deviation from the target.

 


 

  • Thresholds
    The breaches to be reviewed range from legally prescribed thresholds (loss thresholds) and bank-wide thresholds through to parameters defined individually for the client or for individual portfolios. Thresholds can also be defined for key figures from the Portfolio Analysis.

 


 

  • Further goals & targets
    Examples of further goals and targets include planned deposits and withdrawals.

Portfolio Construction

The portfolio construction module of the investment advisory software generates a client's individual target portfolio from a general target portfolio. Both for the initial overall construction of a portfolio as well as for adjustments resulting from a rebalancing recommendation. The software calculates the necessary transactions or orders and simultaneously takes into account all restrictions that are defined bank-wide, client or portfolio-related.

If the portfolio is rebalanced, positions that are currently over-weighted are determined to be for sale on a pro rata basis. From the proceeds generated and, if necessary, from liquid funds, the underweighted securities are bought. Liquidity adjustments, i.e. capital withdrawals or allocations, are executed by the algorithm in accordance with the individual target portfolio structure.

The following methods of portfolio construction are supported within aixigo’s investment advisory software:

  • Model portfolio approach – client portfolios can be created on the basis of a suitable model portfolio. The model portfolio specifies financial instruments or asset classes and their relative proportions. The client's portfolio is built up or adjusted for its investment amount according to these proportions. A customer portfolio can also be created from several model portfolios, again with their relative proportions being indicated.
  • Theme approach – In the theme approach, the client portfolio is made up of investment modules defined by the bank, from which the client makes a weighted selection.

 


 

  • Classical allocation algorithms – A portfolio can be composed individually for a client and determined using an algorithm. Our financial software supports various mathematical models from portfolio theory such as the Markowitz or Black Litterman method. The algorithm determines a portfolio that ideally matches the client's preferences and characteristics, creating the investment allocation.

 


 

  • Customer-specific allocation algorithms – In addition to classical algorithms based on mathematical models, a customer-specific allocation algorithm can be implemented. Components of the calculation and their weighting are definable and offer a calculation which is completely transparent and comprehensible. 

 


 

  • Manual Portfolio Construction – A fully customised portfolio can be created via the manual portfolio construction option by hand-picking the financial instruments per client portfolio. A weighting of the instruments ensures that the desired structure can be monitored and adjusted automatically.

Advisory Documentation

aixigo's investment advisory software automatically generates all legally required documents (statement of suitability and cost statements) for an investment recommendation. Instrument related documents such as KIDs (key information documents) or corresponding fact sheets can also be automatically integrated into a report.

You can also underline the positive user experience of investment advice by providing the customer with additional information in a clear, value-generating presentation. These can be used in the format of a presentation to accompany the advisory session.

During the advisory process, the Advisory Workflow module automatically collects all documents relevant to the advisory session in the Documentation Centre for subsequent delivery to the customer.

Advisory Risk Profile

The advisory risk profile of digital investment advice determines which investment recommendation is suitable and appropriate for the investor and thus provides a secure framework for individual advice based on suitable investment opportunities. Within the investment advisory software the client's profile plays a decisive role in the preparation of recommendations or the allocation of sales campaigns.

 

The system uses defined profiles to determine the right profile for the client. For this purpose, it evaluates information on

  • the objective risk-bearing capacity of the investor
  • their subjective attitude to risk
  • their knowledge and experience (K&E)
  • their investment strategy in the form of objective, duration and desired orientation (return, growth, speculation, etc.) of the investment
  • customer- or portfolio-related specifications on allocation preferences and product holding requirements


If the client wishes to choose a different profile that does not conform to the information given, this can be done in accordance with regulation by means of clarification or justification in the investment advice protocol. The advisory risk profile can be drawn up within the software for natural and legal persons.

System & Data Administration

The System & Data Administration module provides extensive functionalities for all administration and configuration activities in the investment advisory software. Archiving ensures that maintenance data records used productively in the past remain permanently visible.

The system includes a test mode to check the effects of data maintenance on the functional system behaviour before activation on the intended functionality.

The Management Information System (MIS) of the digital investment advisory provides management with information on the advice provided, for example on the quantity structure or the time required for investment advice. However, the MIS also provides detailed information that can be presented to external auditors. It can also output information via export or provide data for other databases, e.g. data warehouses.

 

Maintenance data record types offered by our software for investment advice

Products

The definition of the product universe: aixigos financial software works with securities through direct delivery via interface. The tasks of further maintenance, administration and analysis are available in an easy-to-use user interface. 

The maintenance and usage options offer a high degree of flexibility with free and multiple allocation between securities, modules and model portfolios. The modules created can either be used directly in allocation algorithms or further combined to form different model portfolios. They also offer the possibility of bundling securities thematically. For modules and model portfolios, the product allocation is determined by specifying proportions.

Modules and model portfolios can be provided with descriptive properties using tags, which can be used for portfolio construction or analyses. Products that are no longer to be used in the future can be disabled or only for use in new investment recommendations. 
 

Allocation rules

Model portfolios are often the starting point for customer investment recommendations. Allocation rules then support the customer-specific adjustment of a model portfolio on the basis of its preferences.
 

Investor profiles incl. risk profiles

Base data can be stored for all investor profiles available in the system, such as the validity period of the data record and descriptive contents such as explanations.
 

Materials

In addition to the legally required documents, the system offers the possibility of integrating other useful materials for the advisor or that can support the advisory session and keep them available for retrieval if required.
 

Campaigns

With the help of sales campaigns, it is possible to automatically generate contact opportunities for advice and identify customers to be addressed. The individual campaigns - e.g. "exchange security A for security B" - can be created in the system at any time and then used directly.
 

Texts

Our software for investment advisory services enables the maintenance of text modules for use in advisory documentation or for addressing customers. These modules allow a high degree of individualisation for different client types, for example on the basis of their investor profile, while at the same time keeping maintenance costs to a minimum.

Order Pooling

Before system generated orders are executed, they are bundled by the system. The purpose of this is to minimise transaction costs and largely avoid shifts in portfolio allocation due to price changes. As a rule, several orders are created for a client as part of an investment advisory recommendation. These are bundled by means of a basket order either one-step per portfolio or two-step per portfolio and type (sale or purchase) for subsequent execution.

Buy and sell orders resulting from portfolio construction, rebalancing or manually entered are combined in order netting for each customer. In this process, orders from different modules can cancel each other out if necessary. The investment advice software therefore ensures that only the net surplus is sold or the net additional requirement is purchased and that the portfolio is correctly balanced per module.

Process control coordinates the processing of orders. This ensures that the correct sequence (e.g. first sales, then purchases or sales and purchases simultaneously) is adhered to, and the execution is controlled, i.e. the time of forwarding to external systems. This can be done at regular intervals or at specified times. Our Investment advisory software always works in conjunction with a trading system and the core banking system because it is not  the data-holding system. Order updates are processed by the system within a short period of time in a transaction-safe manner.

Advisory Scenarios & Simulation - Analysis in Investment Advisory

Understanding portfolio developments both positive and negative, including the volatility of its return creates security and confidence for the client. The Advisory Scenarios & Simulation investment advisory module provides the right analyses for this case. The investment advisory software provides visually impressive, clearly understandable and efficient support for the advisor during a meeting with the client. The focus of the analysis can be based on the past or the future of the portfolio.

Historical analysis in investment advisory

For portfolio recommendations or desired portfolios of clients, scenario analyses based on historical price time series illustrate how the portfolio would have behaved within freely definable scenarios - e.g. the financial crisis, the collapse or boom of specific markets, sectors or currencies.

 

Future oriented analysis using aixigo’s investment advisory software

The simulation provides a detailed comparison of current and recommended portfolio composition, e.g. with regard to risk, structure or changed customer requirements. The expected performance in each case and its probability of occurrence are forecast using a Monte Carlo simulation.

Learn more about our other software solutions and our base modules