Financial Operations

Aug 25, 2014

PlanPlus, FinaMetrica release risk profiling tool

Toronto, ON – PlanPlus Inc., a financial and investment planning software company and FinaMetrica, an Australian-based firm with a globally supported psychometric risk tolerance test for advisors have collaborated to release a new best-of-breed risk profiling and suitability analysis for financial advisors and firms.

“Research has shown that most risk questionnaires are simply portfolio pickers and do not actually measure the risk tolerance of a client,” says Paul Resnik, co-Founder of FinaMetrica. “By combining our new test with PlanPlus Planit's portfolio and goal planning I think we have created the best solution available for advisors and firms today to ensure they understand and provide advice suitable to the client.”

FinaMetrica has provided a 25-question risk test for a number of years that is recognized as the benchmark for a proper measure of a client’s tolerance for risk as a psychological attribute. FinaMetrica recently won the Family Wealth Report Awards 2014 for risk profiling, which are unique in that they are judged based solely on entrants’ submissions about client experiences.

"Even though the FinaMetrica test was world-recognized, some advisors and firms were intimidated by having to answer 25 questions." says Shawn Brayman, president of PlanPlus. “We worked with FinaMetrica to trim this to 12 questions but retained the highest degrees of reliability. We then went further with individual back-tests where we compare the way a client answers each individual question compared to their peers in the same risk group. We are able to point out when a client answers a question erratically and warn the client and advisor that they should look more closely at the client understanding and expectations."

Investment Planning Counsel (IPC) was the first company in Canada to make this new technology available to their advisors, rolling it our with the new Version 5.15 of PlanPlus Planit they released to their over 1000 advisors.

“IPC and our advisors have recognized and used PlanPlus Planit as the most sophisticated financial planning solution in the Canadian market for several years”, says Reggie Alvares, EVP advisor and investment solutions at IPC. “With the coming of CRM2 we are always looking for ways our advisors can demonstrate the real value they bring consumers. This new risk test and solution will put them at the top of their game not only in Canada, but from a global best-practices as well.”

Both PlanPlus Planit and FinaMetrica provide their solutions in many languages and countries. Although first available in Canada PlanPlus intends to roll out the solution to its customers in over 30 countries over the summer.




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