Four years after Vanguard introduced Personal Advisor Services — which combines robo-investing and some access to its own financial professionals — the firm says it is moving to give all financial advisors the ability to use its investment modeling and related technology.

“We're continually looking for new ways to enable advisors and expand our existing suite of services to our financial advisor clients,” the company said in a statement. “We often receive requests for access to methodologies that have been perfected in our Personal Advisor Services offering, and we're in the beginning stages of building out those capabilities in order to help advisors improve end investor outcomes.”

PAS has about $130 billion in assets, the fund giant says, out of the $5.4 trillion in total assets that Vanguard manages. It is used by less than 1 million investors today, according to industry consultant Gavin Spitzner, out of the roughly 20 million investors that Vanguard works with worldwide.

With this development, Vanguard will “join … the ranks of Charles Schwab and Betterment for Advisors,” said Spitzner, president of Wealth Consulting Partners, in a recent LinkedIn post. It's unclear, though, if the plan “is part of push into [the] RIA custody space or more of a tech/asset management pure play,” he added.

(Vanguard formed a partnership with Financial Engines in 2003 to serve workplace plan participants.)

Executive discussions

During the Morningstar Investment Conference two weeks ago in Chicago, Vanguard CEO Tim Buckley told a group of reporters that Vanguard could soon offer third-party advisors access to some or all of its PAS technology platform, according to WealthManagement.

“The technology behind PAS is largely digital, and there's a lot we can do with that both in terms of helping plans and helping advisors,” Buckley told the publication.

“We're building the next generation of this in modules so that it could actually be used by advisors,” he continued. “If we can help lower the cost of advice, we'll do that, even if it's not directly through our own advisors.”

No timeline for such a launch has been revealed by Vanguard.

Last week, Tom Rampulla, head of Vanguard's Financial Advisor Services division, spoke about the hybrid-model plans with Financial Planning.

“We'll be rolling that out at some point to give [advisors] the ability to use technology that has been proven to help with their business — different types of software to do their business and make them scalable,” Rampulla said in the report.

The Vanguard news comes about two months after Charles Schwab said it was introducing a $30 monthly subscription plan for its hybrid services.

In another acknowledgement of the growing role that robo services have in wealth management, Canadian robo-player Wealthsimple just picked up $75 million in additional capital from Pimco owner Allianz and Power Financial.

Instant Insights /

Vanguard 'building out' robo services for advisors

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