Leading Solutions for Investment Services. Copyright 2017 Silver Management Group, Inc. All Rights Reserved

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1 Leading Solutions for Investment Services

2 Silver is a trusted provider of enterprise-class business and technology solutions for investment services companies Silver Solutions. Accurate Data Easy to Operate Seamless Integration Ultra Scalable COST BASIS FEE BILLING PORTFOLIO DATA

3 We are Silver We deliver seamless, scalable business and technology solutions for investment services companies Silver Solutions. Our employees apply decades of securities industry and software development experience along with their passion for solving real-world problems. Our strategic partners provide complementary services, software, and market data to enhance our solutions. Our clients trust our deep knowledge of brokerage operations, cost basis reporting, and wealth management. They value our understanding of their internal processes, systems, and environments. And, they appreciate our adaptable software that integrates seamlessly with their technical infrastructure and scales to meet their specific business needs. This is why clients choose Silver. Why Silver Solutions are processing tens of millions of investment accounts and more than $1 trillion in assets. And why, after 25 years in business, Silver continues to deliver superior value for our clients.

4 2016 expanded outsourced business processing operations services for cost basis, fee billing, and performance reporting 2015 deployed fully automated fee-based billing solution as part of client s wealth management platform 2014 integrated centralized portfolio data solution in support of clients multi-vendor wealth management and robo-advisor platforms 2013 released adjunct fixed income engine for integration with clients' existing portfolio accounting systems 2011 launched EESAcompliant cost basis solution in support of brokers regulatory transfer reporting and year-end tax reporting 2009 released adjunct wash sales engine for integration with clients' existing portfolio accounting systems 2007 deployed ultra-scalable portfolio accounting and account/grouping management solutions as part of client's enterprise-wide SOA initiative 2004 expanded wealth management and brokerage operations consulting practices 2002 integrated software components as part of client s multi-vendor financial advisor platform 2000 launched full suite of retail securities brokerage software in client's multi-tenant online service bureau 1998 focused consulting practice within investment services industry and commenced proprietary software development initiatives 1991 founded company to provide multi-disciplinary, multiindustry management and technology consulting services

5 The Silver team applies decades of securities industry and software development experience along with a passion for solving real-world problems to deliver cost-effective brokerage operations, cost basis reporting, and wealth management solutions for our clients.

6 Executive Team Blake Henry Managing Partner, Business Blake is responsible for establishing and enriching client relationships, identifying opportunities for partnerships and growth, and leading all aspects of Silver s business operations. Since he founded the company in 1991, Blake has overseen development and deployment of several enterprise-scale brokerage processing applications primarily for large investment services organizations and has personally managed numerous consulting engagements. Prior to founding Silver, he was a Computer Programmer for IBM Corporation and CACI Field Services. Blake earned his B.S. in Economics at the Wharton School of the University of Pennsylvania with concentrations in Marketing and Decision Science. Neal Ruskin Managing Partner, Product Neal is responsible for Silver s suite of brokerage processing software and serves as strategic business and technology advisor for Silver s investment services clients. An acknowledged expert in cost basis portfolio accounting and investment tax reporting, he serves as an industry thought leader and guides Silver s interpretation of IRS regulations and related statues. Prior to joining Silver, he served as Chief Enterprise Architect at TD Ameritrade and Technical Director at CheckFree Investment Services (now Fiserv). Neal earned his M.A. in Industrial Design and Human Factors from The Pratt Institute and his B.A. in Political Economics from Princeton University. Robert Benkovitz Managing Partner, Technology Rob is responsible for all technical aspects of Silver s suite of brokerage processing software and hosting services. He heads a team of highlyskilled and experienced software development professionals in technical design, application architecture, research and development, quality assurance, software deployment, and technical operations. Prior to joining Silver in 1999, Robert served in various technology positions with CheckFree Investment Services (now Fiserv), Prudential Investments, ILX Trading Systems (now Thompson Reuters), and Brown Brothers Harriman. Robert earned his B.S. in Computer Science from the State University of New York at Stony Brook.

7 Silver Cost Basis Solutions Fully compliant with the cost basis reporting provisions of the Emergency Economic Stabilization Act of 2008 (EESA) and related regulations and designed for configurability and customizability, Silver s cost basis platform may be licensed and deployed with any mix of available features to satisfy specific business requirements. Automated Zero-Break Corporate Actions Inline Fixed Income Processing (Simple & Complex Debt) Comprehensive Wash Sales (Full Traceability) Low Cost Operations & Support Adjunct Capability Flexible & Rapid Integration Ultra-Scalability

8 Silver Cost Basis Solutions Automated Zero-Break Corporate Actions Provide accurate cost basis through corporate actions via automated zero-break processing vastly reducing operations workload. Inline Fixed Income Processing (Simple & Complex Debt) Meet regulatory requirements for fully conformed tax, transfer, and client reporting for all simple and complex debt instruments. Comprehensive Wash Sales (Full Traceability) Rely on the industry s most accurate and complete wash sale processing while maintaining independent lot and sublot views. Also maintain full traceability for lot-level operations and client support and configurable sublot granularity for reduced volume reporting to serve very active accounts. Low Cost Operations & Support Reduce operational workload via comprehensive exception reporting and a full-featured operations portal, as-of capability, bulk operations and automatic re-processing. Reduce client support workload via lot and sublot explainer tools.

9 Silver Cost Basis Solutions (cont d) Adjunct Capability Supplement existing tax lot systems with fixed income and/or wash sale processing via reconciliation-free integration that avoids precision, rounding, fractional share, lot disposal sequence, and other pitfalls. Flexible & Rapid Integration Integrate with multiple back-office, trading and other data sources via rapidly configurable rule-driven interfaces; maintain synchronization with other lot accounting systems; chose to maintain critical security and account master data including asset classifications, specified as of dates, average basis elections, fixed income elections, Sec 475 status directly within the system or via existing systems and business processes. Ultra-Scalability Scale to millions of accounts and accounts with millions of transactions within tight SLAs via event-driven parallel processing and a hybrid persisted/dynamic data model with snapshotting capability.

10 Silver Cost Basis Solutions Case Study Retail Broker A leading online broker with a large mix of active traders and buy-and-hold investors needed help after the cost basis solution offered by their back office provider failed to meet their needs. In only four months, Silver integrated its cost basis platform and processed a year s worth of activity in time to meet the initial reporting deadline. Silver s Cost Basis solution continues as the broker s cost basis book of record, processing over 1 million daily transactions and supporting year-end 1099 reporting for over 5 million accounts with more than 80 million open lots and 500 million closed lots to date. Client Platform Flexible Integration Silver Cost Basis

11 Silver Cost Basis Solutions Wash Sales Case Study Prime Broker Silver helped a major prime brokerage services provider add wash sales and fixed income processing capabilities to an existing portfolio accounting system. We did this without disrupting their current business and technical processes. Where other providers were unable to handle the extremely highvolume typical of prime accounts, Silver s solution scaled to meet their needs, processing over 200,000 debt lots and more than 500 million wash sale sublots in just 2,500 accounts (some with millions of transactions). All was accomplished without requiring any ongoing stock record reconciliation thereby minimizing operational overhead. Client Cost Basis Ultra-Scalability Fixed Income Processing

12 Silver Fee Billing Solutions Silver s Fee Billing solutions help firms to streamline their billing processes, guard against potential fee leakage, and reduce operational risks by employing a fully customizable billing platform available as an in house or cloud based solution. Flexible Billing Methodologies Robust Fee Schedule Support Exclusions and Discounts Advanced Account Grouping UMA and Asset Class Billing Support Configurable Workflow Seamless Integrations Streamlined Operations

13 Silver Fee Billing Solutions Flexible Billing Methodologies Bill quarterly, monthly, or on demand, in advance or in arrears, using end of period or daily average values, for multiple payees, configurable down to the individual product level. Robust Fee Schedule Support Create multi-tier fee schedules that work for your business. Assign fee schedules at the firm or product level, or down to the advisor, group, and individual account levels for exception to the rule clients. Create fee splits for advisors that share accounts. Exclusions and Discounts Set up total portfolio, UMA sleeve, asset class, or security exclusions and discounts for your entire firm, specific products or advisors, or individual groups and accounts. Advanced Account Grouping Create multi-tier account groups to allow for break-point qualification at the household level, and consolidated invoicing and account debiting. interfaces.

14 Silver Fee Billing Solutions (cont d) UMA and Asset Class Billing Support Calculate fees at any mix of the total portfolio, UMA sleeve, or asset class levels. Configurable Workflow Automate your intra-period billing workflow by configuring events such as account opening/termination, large flows, advisor changes, and UMA sleeve changes to trigger bill re-calculations. Seamless Integrations Take advantage of integrations with multiple custodians and data aggregation providers to seamlessly update portfolio and relationship data, as well as the digital transmission of debit files. All billing data is also made available through multiple extracts as well as a fully formed Restful API. Streamlined Operations Take advantage of easy to use exception reporting and remediation tools to identify and fix reconciliation issues leading to potential fee leakage. View audit trail reports identifying updates made by operators and data interfaces.

15 Silver Fee Billing Solutions Case Study RIA Silver s Fee Billing solution helped an RIA firm with more than 500 advisors move from a manually intensive and error prone, outsourced billing process, managed with spreadsheets to a fully automated and integrated cloud-based solution. This enabled the firm to move away from maintaining fee schedules at the individual account level, and allowed them to set up UMA sleeve default schedules with account overrides. This resulted in a dramatic reduction in the number of fee schedules, reducing errors and risk while alleviating operational strain. Silver s Fee Billing implementation automated the valuation of assets and creation of account groups through an automated data interface with one of the largest custodians servicing independent RIAs including debit file integration. Automated Data Interface Streamlined Operations Unified Managed Accounts (UMA)

16 Silver Portfolio Data Solutions Silver s Portfolio Data solutions provide firms with a complete picture of their entire book of business by delivering an automated, reconciled source of portfolio and relationship management data in support of the powerful reporting of performance and risk measurement, data analytics, and key performance indicators (KPIs) that firms care about. Automated Relationship Management Flexible Data Entitlements Robust Performance Reporting Configurable Benchmarks Correlated Risk Measurements Insightful Data Analytics and KPIs

17 Silver Portfolio Data Solutions Automated Relationship Management Automate the creation of multi-tier account householding and grouping, via data interfaces with customized rule sets. Flexible Data Entitlements Access account and group data from automatically configured entitlements customized for your firm, from home office, advisor and manager access, to individual investor permissions and full admin capabilities. Robust Performance Reporting Create powerful performance reports using before and after tax portfolio returns and asset allocation data created by Silver s fully GIPS compliant calculation engine.

18 Silver Portfolio Data Solutions (cont d) Configurable Benchmarks Compare performance returns and risk measurements to user defined benchmarks including weighted blends of securities and/or indexes. Correlated Risk Measurements Put performance returns into context by correlating them with risk measures your firm cares about like alpha, beta, Sharpe ratio, standard deviation, and many more. Insightful Data Analytics and KPIs Fully understand your firm s practice by leveraging big data insights and KPIs that matter to you. This includes firm metrics such as gross revenues, growth indicators like revenue increases from existing, new, and retained clients, and distribution measures like average revenue per client, advisor, branch, and more.

19 Silver Portfolio Data Solutions Case Study FinTech Provider Advisor Workstation Robo Platform Silver s Portfolio Data solution was implemented for a cloud based software provider, powering an innovative advisor workstation and robo-advisor platform which supports numerous RIA firms. Silver s Portfolio Data solution provides the central access point for portfolio data, relationship management, and data entitlement information, as well as acting as the source of aggregated data for performance reporting and fee billing calculations. Automated portfolio data interfaces with a large custodian, an external rebalancing provider, and a third party data aggregation service provide turnkey access to extremely rich client data which seamlessly integrates with the advisor workstation platform through Silver s RESTful API. Performance Reporting Fee Billing Central Access Point Portfolio Data

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