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Asset Management Platforms: A Key Element for Your Financial Development 

Anesa

The ongoing monetary viability of FinTechs is correlated with the possibilities of these companies to adapt their operations to the latest technological demands of the market and leverage encryption protocols that can positively influence the security of provided services. That said, the digital world doesn’t revolve only around financial-technology companies. Are you a private individual, and are you looking to optimize your investments across multiple classes and automate a significant percentage of the procedures crucial for the profitability of your portfolio? In that case, investing in an asset management platform should be on your radar.

As a simple definition, asset management platforms are digital portals that can be utilized either by private investors or financial advisors to keep track of their portfolios, evaluate the risks of their investment diversification processes, and automate a significant percentage of the procedures required to keep portfolios in line with regulatory practices. Asset management technology can be leveraged to diversity your digital investments across multiple classes, provide visual-aid tools useful for breaking down complex figures into easy-to-understand data, and represent a viable solution if you are looking to branch out into new investment avenues such as in cryptocurrencies, but you want to minimize the risks of your financial commitments.

The principal benefit of these kinds of platforms is related to the centralization of the client’s ongoing investments. Do you have stocks in legacy companies, and are you also involved in precious metals trading via tokenization? Then, asset management technology can be an efficient way to bring your investments onto a singular platform and keep your monetary commitments locked into a singular account. Digital platforms can reduce manual engagement with ongoing investment, provide the necessary real-time data for decision-making processes and are customizable based on the risk tolerance of each investor.

What Technologies Are Utilized in Asset Management?

When we say asset management technology, we are referring to a growing set of advanced technological resources and frameworks designed to enhance the processes required in digital financial management and streamline the operations expected to be performed by investors. The technologies used in digital asset management can provide the necessary informational data for decision-making procedures, enhance the security of clients’ investments, and, not least, simplify the investment-diversification processes associated with modern portfolios. What technologies are most relevant in asset management?

First of all, we should mention blockchain. In the context of a digital asset management platform, blockchain is a decentralized distributed ledger technology that can help investors keep track of tokenized assets. How does it all work? Well, to put it in simpler terms, a blockchain is composed of linked-together data records containing a list of entries that cannot be modified without changing the integrity of all the blocks that contain the particular informational structure. In other words, the technology is transparent and decentralized, which is perfect for secure data management operations.

In asset management technology, blockchain can be utilized to create decentralized identity frameworks that allow full flexibility to users and make transactions visible to all the platform’s participants. But, blockchain is not the only technology utilized in asset management platforms. Cloud computing, IoT, and robotic process automation can help identify new investment avenues, optimize portfolios, or even automate the generation of reports necessary for regulatory compliance purposes. That said, at the end of all these processes, one growing technology stands above all. And that’s AI.

What’s the Connection Between AI and DMA platforms?

AI is the buzzword most often associated with technological developments in the digital asset management sector. And for good reasons, as ML models have made great strides in the last couple of years and fundamentally changed the financial markets and the development frameworks adopted by FinTechs. The machine learning models utilized by Artificial Intelligence algorithms are fantastic at analyzing huge amounts of data in a short amount of time and identifying patterns with a shocking degree of accuracy.

In asset management platforms, AI algorithms can be utilized to determine the risk factors associated with digital portfolios, automate their rebalancing operations, predict ongoing financial developments based on previous macroeconomic informational data, and develop bespoke investment frameworks tailored to the preferences of investors. In other words, in the world of digital investment portfolios, Artificial Intelligence can monitor the market in real time and identify overvalued or undervalued investment avenues, automate entry operations, and profile clients based on predetermined factors such as risk thresholds or past transactional behavior. Not least, in the context of asset management technology, AI is crucial in digital fraud detection and can continually monitor AML and KYC compliance.

What Regulations Are Applicable to DAM Platforms? 

Just like it’s the case with conventional financial institutions, digital asset management portals must keep in line with the stipulations of the Bank Secrecy Act and implement strict AML/KYC procedures. DAM platforms must make use of CDD and verify the identity of customers who utilize their financial services. On top of that, they must fill SARs with the Financial Crimes Enforcement Network for any operation that might be suspected of money laundering. Plus, US-based DAM platforms must be registered with the SEC and respect the data-protection regulations mandated by the California Consumer Privacy Act.

DAM platforms that fail to comply with the stipulations of the Bank Secrecy Act or AML/KYC regulations can be fined by the FinCEN or have their operations paused temporarily or indefinitely. Do you want to leverage the services of a reputable asset management platform that keeps in line with the regulations imposed on conventional banking institutions and FinTechs? Then, a good idea would be to use a portal that provides biometric login options for its users, offers access to a wide variety of portfolio diversification avenues, and, more importantly, is transparent with its pricing structure and doesn’t have hidden custodial or transaction fees. With enough care, asset management technology can push your investments to the next level and have a pronounced effect on your monetary growth forecasts.