Rebalancing software: the two-hour setup edge

RIABiz's 2010 review of RedBlack's Rebalance Express, the third in a series covering the small rebalancing software niche, arrives at a moment when most RIAs have yet to adopt the tool at all, and the three companies trying to own that niche have built very different strategies. In that telling, iRebal is the most established player, Tamarac has the most customers and the deepest integration, and RedBlack is the least expensive—and all three are making at least some customers happy; the devil is in the details.

RedBlack, the challenger based in Bedford, N.H., entered the rebalancing technology market in 2006 with the declared intention—according to Peter Giza, its chief of technology—to 'break out of the mold that the industry has tried to cast for its vendors.' The software now targets RIAs with assets between $20 million and more than $1 billion, on a pitch of substantially lower pricing than the incumbents and a setup process that runs about two hours, a speed that stands out in a category where many products require days of training.

Because the RedBlack review came last in the three-part series, its author had already spent time in the competing systems, and that perspective shows up in the usability analysis: the review finds RedBlack's product navigable and intuitive, crediting chief architect Roel Vlemmings, whose Windows UI background helped produce an interface that feels familiar at first glance. The contrast with iRebal is sharp—RedBlack makes the user feel at home, while iRebal expects users to learn its indicators, layout, and navigation from scratch.

The setup-time claim is the most practical number in the review. A two-hour implementation versus days of training is the difference between a tool a firm can start using next week and a project that drags into next quarter, and for a small practice without a dedicated operations team that difference can decide whether the software is actually adopted or left to gather dust.

Against Tamarac, the trade-off is scope: Tamarac is an all-in-one platform, while RedBlack focuses strictly on rebalancing. For a practice that wants a single vendor to handle portfolio accounting, reporting, and rebalancing, Tamarac's breadth is the reason to pay more; for a practice with a mature technology stack already in place, RedBlack's narrow focus means buying exactly the missing function with nothing extra to configure.

Few RIAs have migrated to rebalancing software at all, which puts the three vendors in the position of building a market rather than just competing for share—and raises the stakes on the initial experience. The review credits iRebal with thriving after its acquisition by TD Ameritrade, a reminder that a vendor's corporate parent and runway are part of the diligence, even in a category this young.

The practical lesson is to decide on workflow, not feature lists: setup time is a real cost, and interface familiarity is a real productivity factor. A practice that already has its broader platform in place should choose the low-cost specialist, provided the two-hour promise holds in a live trial; a practice that wants one platform to do everything should accept training days as part of the price of admission. The decision is best made with the implementation calendar in plain sight and a live trial scheduled.