DTCC Solutions’ Managed Accounts Service provides a central gateway for the seamless communication of some of the most important information required to establish and maintain managed accounts. It links all trading parties to one standardized platform through a single connection.

Overview

DTCC Solutions’ Managed Accounts Service provides a central gateway for the seamless communication of some of the most important information required to establish and maintain managed accounts. It links all trading parties to one standardized platform through a single connection. The service - the first of its kind - automates the flow of data for a wide variety of managed accounts products.

Information is exchanged in the form of standard XML messages, so errors, delays and operational costs are greatly minimized. And DTCC's time-tested infrastructure provides unparalleled data integrity, and facilitates safe and secure data exchange.

Who Can Use this Service

Investment managers, sponsor broker/dealers and service providers that create and administer managed accounts can use the service via DTCC’s MQ interface or through DTCC WebDirect, a Web interface that gives members direct access over the Internet to services provided by DTCC's subsidiaries.

Benefits

The Managed Accounts Service offers a number of advantages:

• Saves time and money by streamlining back-office processes and reducing high fixed costs associated with opening and servicing managed accounts.
• Eliminates time-consuming paperwork, manual processing and paper-intensive recordkeeping, which can result in errors and pose risk.
• Allows funds to be invested quickly using an automated service that eliminates delays in putting client funds to work.
• Manages a higher volume of accounts at a lower cost, so users can grow their business and offer more customized products and services.
• Protects investors by keeping their records private and secure.
• Reduces operational risk in an environment where one error can have tremendous financial consequences.
• Streamlines connectivity through a self-healing, secure network that links trading partners.

How the Service Works

The Managed Accounts Service currently supports the exchange of the following information between sponsors and investment managers:

Account Setup — This standard message includes all the data needed to open a new account in one easy step, including client profile, risk tolerance, tax status, how the account will be funded, restrictions, and authorization to trade as of a particular date.

Account Maintenance — These messages include deposit funding, withdrawal and account termination notifications and simplify day-to-day account maintenance activities.

Client Profile Update — Changes to a client's investment strategy, sponsor program, distributions and dozens of other updates can be implemented quickly with minimum risk of error. The service also simplifies meeting regulatory requirements for periodic review and updates to investor accounts, and provides documented records.

Billing Detail and Summary — level information from sponsor to investment manager provide investment managers with the backup information needed for payments based on assets under management.

Model Messages — MAS currently accommodates multiple-discipline and multiple-style accounts. In conjunction with The Money Management Institute’s work on model message standards, enhancements are under way to process model-only portfolios, the latest version of unified managed accounts (UMAs). Model-only approaches do not eliminate the need for all communication between sponsors and managers but they do change the nature of that communication. DTCC is working to ensure that sponsors, managers, and overlay managers realize the benefits of standardization in the evolving area of UMAs.

Messages flow through DTCC's secure infrastructure and go through an automated, four-step process:

1. Entitlement provides confirmation of sender and receiver and validates a relationship between both parties.
2. Validation confirms that messages conform to The Money Management Institute’s communications standards.
3. Audit provides detailed trails of messages processed, including time stamps and routing information.
4. Routing provides connectivity between sponsors and investment managers.

DTCC plans to extend the functions and value of the service, working with participants to develop solutions that continually improve operations and minimize risk.

For More Information

Call us at (212) 855-8877 with questions or for a demonstration of the Managed Accounts Service.