Upvest’s new API-based portfolio engine: now live

Why are investment portfolios important?

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In a landscape of neobanks, neobrokers, and trading apps offering endless ETFs and stocks to choose from, simple investing in a dedicated portfolio is growing again in popularity. Companies like Raisin try to make investment experiences as easy as possible, offering end users a simple choice for their long-term investment.

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The goal is to choose from pre-selected portfolio options (based on risk appetite) and invest for a long-term goal, such as retirement, buying a car or just putting your money to work without being an investment expert.

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These robo-advisors and other portfolio-based investment solutions are simple to understand from the eyes of a customer. However, what’s not so simple hides in the background - the infrastructure and functionality that enables portfolio managers or robo-advisors to offer and execute these services.

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The unit cost to produce these portfolio services is often one limiting factor for providers that want to reach end users at scale. Traditional infrastructure providers try to keep up with the complex demands of today’s end-user needs. Nowadays retail investors prioritise personalisation¹, real-time data insights², and a digital-first experience³⁴⁵. Meeting those needs by creating even a simple portfolio or allocation of assets involves high levels of complexity, time, and costs.

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Upvest’s portfolio engine is designed to address those challenges for providers. It’s the go-to solution for any fintech, wealth manager, or traditional bank looking to offer modern and easily customisable portfolios.

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Current infrastructure doesn't allow for speed, scalability, or transparency

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Current banking infrastructure offers only limited functionality based on costly manual processes⁶. For example, rebalancing a portfolio often leads to a full order pause for multiple days. Another time delay often stems from non-scalable processes. Order execution on an asset-by-asset basis is often done with manual order placement through various mediums. Some larger ticket sizes can take up to a week for full execution.

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Complexity adds another layer of difficulty. Many businesses need to navigate a vast set of different systems from multiple partners to deliver full customer value. Bridging these technological silos with manual, expensive, and error-prone processes is the reality for many companies. In such a setup, full automation is hard to achieve. Scaling products and services increases production costs even further.

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The lack of transparency further adds to the issue. With outdated systems lacking the ability to provide real-time insights, investment service providers are challenged to gain access to instant data availability. This limitation negatively affects the user experience and inhibits the ability to swiftly respond to market changes and enhance trust and operational efficiency.

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Upvest’s portfolio engine: redefining investment experiences

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Upvest’s plug-and-play portfolio engine offers an API-based and fully integrated portfolio infrastructure. It enables unique and scalable investment experiences for both Upvest’s clients and their end users.

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At Upvest, we believe in simplifying the complex. The portfolio engine lets you access every aspect of your investments via a seamless API. That way you can empower your end users to create portfolios, place orders, and set up rebalancing strategies and portfolio savings plans in just a few clicks.

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With Upvest’s API-first approach, you have automated monitoring of all processes related to your portfolio management. All information is exposed through webhooks which enable real-time access and full transparency in tracking the execution of orders, completion of rebalancing, and real-time performance insights.

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Integrate Upvest’s portfolio engine quickly and seamlessly into your platform

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Upvest’s portfolio functionality is easy to use and intuitive. From initial account setup to the first portfolio investment in only 4 API calls.

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From account setup to first investment in 4 simple steps:

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Step #1: Open a portfolio account

Step #2: Create a model portfolio

Step #3: Configure a user portfolio

Step #4: Place an order

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If you want to read more about how to integrate Upvest’s portfolio API and all the benefits that come with it, have a look at the API guides and specs.

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Upvest’s portfolio engine enables cross-asset class portfolios out-of-the-box

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Upvest’s built-in fractions engine enables any end user to build and tailor their portfolios based on their investment needs and risk appetite.

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Anyone can create unique portfolios and mix and match ETFs, stocks, ETPs, and soon Bitcoin or cryptos. No need for a large upfront investment - end users can start investing with as little as 1€.

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By enabling end users to combine assets, providers allow them to create long-term stable portfolios and manage risk. Thereby granting end users peace of mind, fostering loyalty, and building long-lasting relationships. Users can build their dream portfolios, share ideas, copy trade, and create a marketplace for portfolios together. That way, they can benefit from a collaborative and user-led investing experience.

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Instant portfolio rebalancing at scale: from days to minutes

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Rebalance thousands of user portfolios in minutes with a single API request using Upvest’s in-house rebalancing engine.

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Upvest’s asynchronous and event-driven architecture enables us to handle massive workloads effortlessly and in parallel. That way we ensure that even during peak demand periods, the rebalancing operations are running smoothly and accurately. By aggregating and executing orders as block orders, we ensure execution quality.

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With Upvest’s rebalancing engine, you can set up automated strategies based on time (e.g. once a year), specific thresholds (e.g. percentage deviation of a position from the defined target allocation), and (customisable) asset classifications. You can also trigger an immediate rebalancing of any user investment at all times via a simple API request. Once a rebalancing is initiated in the system - either through an automated strategy or a one-off request - the engine handles the entire order management process from start to finish. This removes the need for any complex calculations on your end.

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We redefine the way end users switch between portfolio investments. With Upvest’s Investment API, end users can switch portfolio investments by simply selecting the new portfolio to which the money should be reallocated. The system will then automatically trigger a rebalancing and create orders to correct the differences between users’ old and new portfolios. That way you save yourself and your users the transaction costs, reduce their tax burden, and see results (almost) immediately.

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Tax estimation and forecasting with ease

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Upvest’s portfolio engine covers the full lifecycle of your users’ portfolio investments and includes automated handling of taxes, user and regulatory reporting, corporate actions processing, and account, fee, and order management.

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Upvest's portfolio engine calculates the tax effects incurred by users during sell orders and portfolio rebalancing upfront. With post-tax sell orders, the engine accurately estimates in advance the right amount of taxes and adapts the order size accordingly.

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Raisin powered by Upvest’s portfolio engine

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Raisin, one of Europe’s leading fintechs, will also leverage the portfolio engine to efficiently handle all aspects of its users' portfolio investments. Everything from buying and selling to triggering mass rebalancing and executing savings plans.

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Kim Felix Fomm, CIO and VP Wealth Management of Raisin Bank, says: “Upvest’s solution allows us to offer a number of different products at scale via individualised model portfolios. Integrating the portfolio engine into our existing workflows has been seamless and fast, resulting in an efficient process for Raisin and our customers”.

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Ginmon already benefiting from the portfolio engine

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Upvest’s partner Ginmon, which was ranked as Germany's #1 robo-advisor by Capital Magazin, is also the first partner to go live with the portfolio engine. Lars Reiner, founder and CEO at Ginmon, shares: “Upvest’s portfolio engine has been a helpful building block in our journey to further improve our portfolio management, automating many key backend processes while migrating to a reliable, scalable, and secure infrastructure”.

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More to come…

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We are just getting started! Soon the portfolio engine will cover more features - from real-time risk analysis and performance analytics to smart rebalancing and even the option to create your very own funds and investment products.

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At Upvest, we build for the future - this is the first step towards changing the portfolio environment.

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If you want to learn more about Upvest’s portfolio engine, get in touch with one of our experts:

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Disclaimer: The content provided in this article is intended for educational and informational purposes only and should not be construed as financial or investment advice. Always conduct thorough research and seek professional guidance before making any investment decisions. The past performance of any investment does not guarantee future results. ‍

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Sources:

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1. “Personalised investment experiences are increasingly being favoured, as 81% of investors want the ability to customise their investments to match their personal values”. (Natixis, Global Survey of Individual Investors conducted by CoreData Research, 2019)
2. “94% [of the Investor Generation] want access to information and tools to do their own research.” (Charles Schwab, The Rise of the Investor Generation, 2021)
3. “The unexpected retail investing frenzy was also fueled by the prevalence of easy-to-use investing apps, which are increasingly being integrated into payment apps, making money transfers even more seamless”. (Deloitte, The rise of the newly empowered retail investor, 2021)
4.  “In 2020, about 5m retail brokerage accounts were opened (approx. 15% of U.S. equity investors) while more than 6 million Americans downloaded a trading app in January 2021. Similar trends in retail trading can be observed in Europe, Asia and Africa”. (Amundi, Retail Investors’ Behaviour in the Digital Age: How Digitalisation is Impacting Investment Decisions, 2023)
5. “Over 45% of respondents said they identify mobile as a top-three factor that determines their choice of FI, up from 38% in 2019—making it the second most important factor behind fees. Critically for the banks themselves, 64% of mobile banking users said that they would research a bank’s mobile capabilities before opening an account, and 61% say they would change banks if their bank offered a poor mobile banking experience.” (Insider Intelligence, Mobile Banking Competitive Edge Study, 2020)
6. “Manual processes, siloed systems, batch-based processing, and other obsolete infrastructure can perpetuate inefficiencies. Many banks spend enormous resources on additional controls and on remediating errors through rekeying and queries. This old technology also often inhibits the real-time, holistic view of clients and transactions that is so valuable to banks.” (Deloitte, Modernizing transaction banking: Service externalization and the right technology portfolio, 2017)