What is a TAMP and Should You Use One?

Financial advisors have much on their plates, from attracting new clients to keeping up with ever-changing compliance regulations. Due to this predicament, one-third of financial advisors say focusing on client relationships is challenging.

A Turnkey Asset Management Program (TAMP) may be the ideal solution if you’re one of them. TAMPs allow you to outsource your investment management and streamline your administration so you can dedicate more time to your clients.

While TAMPs are very popular, 66% of advisors don’t fully understand how these platforms work. Below, we’ll explain what TAMPs are, how they work, their benefits and drawbacks, and how to determine if they’re the right tool for you—with a special focus on how SharpeMetrix delivers TAMP benefits with a data-driven edge.

What is a TAMP?

A TAMP is a comprehensive investment platform that helps you manage your clients’ portfolios and enjoy comprehensive back-office support. TAMP services typically include:

• Investment due diligence
• Asset allocation
• Trade execution
• Portfolio rebalancing
• Performance reporting
• Compliance management

Some TAMPs also offer the following administrative and operational support services:

• Client onboarding
• Self-service portals
• CRM capabilities
• Billing and reporting
• Marketing automation
• Client communication
• Advisor consulting

By outsourcing these tasks, you can allocate your time and attention where it matters most: building strong client relationships, delivering personalized financial planning, and driving business growth.

A Brief History of TAMPs For Financial Advisors

TAMPs were first developed in the 1980s. Back then, the technology was much more rigid and rudimentary than today, but even so, TAMPs revolutionized the financial advising landscape.

Forty years later, TAMP technology has advanced substantially. Today’s TAMPs are much more flexible, offering a broader scope of investment solutions and greater customization. Additionally, many TAMPs have expanded their offerings beyond basic asset management.

Best of all, modern financial advisors have a wide range of TAMP options, so finding a TAMP that aligns with advisors’ unique strategies, needs, goals, and budgets is easier than ever before.

How Does a TAMP Work?

As outsourced investment platforms, TAMPs take care of many components of the asset management process, including:

Investment strategy – As your financial advisory firm grows, hand-picking investments for each client simply isn’t feasible. Your TAMP can select investments on your behalf and ensure they align with your clients’ goals, risk tolerance, and timelines.

Portfolio design – TAMPs can access a vast selection of model portfolios, which third-party asset managers or in-house investment teams may create. Once you’ve selected your preferred investment strategy, your TAMP can design and maintain your clients’ portfolios accordingly.

Account management – Manual account management can be time-consuming. Outsourcing asset management to a TAMP takes many tedious tasks off your hands, including trade execution and documentation, transaction monitoring, and performance reporting.

Portfolio rebalancing – Maintaining your clients’ ideal asset allocation requires ongoing optimization. By buying and selling certain securities, TAMPs can automatically rebalance portfolios to align with your clients’ risk tolerance and investment goals.

Performance monitoring – TAMPs constantly monitor the performance of your clients’ portfolios and generate detailed performance reports, ensuring they’re always well-informed about their investments.

Reporting and compliance – Many TAMPs can carry out crucial compliance and reporting tasks, including maintaining detailed records about all investment transactions and client interactions. This automated audit trail offers clear evidence of your adherence to fiduciary standards.

TAMPs provide these comprehensive services using a combination of specialized teams and technology. Their specialized teams often include in-house investment managers, third-party asset managers, compliance officers, and administrative support staff.

Meanwhile, TAMPs’ automated software uses advanced algorithms to execute trades, rebalance transactions, generate reports, maintain compliance, and automate client communication.

How SharpeMetrix Works Differently

While SharpeMetrix delivers all the TAMP benefits listed above, we take a fundamentally different approach to portfolio construction:

Systematic, Rules-Based Methodology – Instead of discretionary portfolio managers making subjective decisions, our portfolios are built using systematic, rules-based algorithms. This eliminates manager risk and ensures consistent application of proven factors.

Proprietary Alternative Data Signals – We don’t rely on the same data everyone else uses. Our platform harnesses:

• Earnings Expectations – Forward-looking forecasts more accurate than consensus
• Sentiment Analysis – ML-powered extraction from earnings call transcripts
• Innovation Signals – Patent and H1B visa data predicting future growth

Enhanced Quantitative Factors – We’ve refined traditional factors beyond generic implementations:

• Enhanced Value (forward-looking earnings)
• Enhanced Quality (weighted accruals)
• Enhanced Momentum (peer-benchmarking)
• Enhanced Volatility (risk-adjusted)

This data-driven approach provides differentiation that traditional TAMPs cannot match.

What Are the Benefits of Using a TAMP?

In 2018, 54% of financial advisors outsourced their investment management to TAMPs. By 2021, TAMPs managed over $2 trillion in Assets Under Management (AUM), with RIAs representing the largest segment of users. Given the rising demand for efficiency and scalable solutions, these figures have likely only increased in recent years.

Let’s explore six key benefits of integrating a TAMP into your financial advisory practice:

#1 More Time For Clients

Trust is your greatest asset if you want to build a thriving financial advisory practice. Trust is built through consistent communication and personal relationships. Thus, it’s no wonder that 75% of consumers consider “developing a personal relationship” to be the most valuable service a financial advisor can provide.

Many financial advisors want to connect with their clients more often—they simply need to find the time. By outsourcing security selection, portfolio rebalancing, and performance monitoring to a TAMP, you can provide high-quality asset management while delivering excellent customer service.

Investing more time in your client relationships can yield impressive returns. After all, nine out of ten clients report that their financial advisors’ frequency and quality of communication heavily influence their decision to remain at their firm and their willingness to provide referrals.

#2 Access to More Investment Options

One of the main reasons financial advisors leverage TAMPs is to increase their investment options. In fact, 23% of surveyed financial advisors cited this as their primary motivation for using a TAMP.

TAMPs can connect you with a wide variety of investment products that may be unavailable through other channels, including mutual funds, exchange-traded funds (ETFs), and separately managed accounts (SMAs).

SharpeMetrix Advantage: While we focus on systematic equity strategies, our proprietary alternative data signals provide access to insights that simply aren’t available through traditional channels—giving you a genuine informational edge.

#3 Seamless Scalability

The majority of financial advisors are highly motivated to grow their businesses. Unfortunately, only 12% are satisfied with their current growth rate. As a highly scalable solution, TAMPs can help close this gap.

TAMPs can strengthen your ability to scale your business by:

• Streamlining your asset management and administration
• Freeing up your time to focus on growth-oriented initiatives
• Ensuring expert asset management, even as your AUM increases
• Strengthening your client relationships, so you can attract more referrals and increase your client retention rate

SharpeMetrix Advantage: Our flat-fee pricing structure makes scaling even more attractive. Unlike percentage-based TAMP fees that grow with your AUM, our flat fee means your profitability increases as you grow.

#4 Cost Efficiency

TAMPs typically charge fees based on a percentage of your total AUM. On average, TAMP fees range from 0.85% to 2.80% of your AUM. Your fee amount will ultimately depend on the cost and complexity of your investments.

Even with these fees, TAMPs cost a fraction of what hiring, training, managing, and compensating an in-house team of investment professionals would cost. TAMPs can also take advantage of their economies of scale to provide you with more competitive pricing than you’ll find on your own.

SharpeMetrix Difference: We’ve eliminated percentage-based pricing entirely. Our flat-fee model protects your margins as you scale, ensuring that TAMP costs don’t compound as your practice grows.

#5 Compliance Support

Staying on top of constantly evolving regulations can be daunting. More importantly, it can divert your time and attention away from client relationships.

TAMPs with built-in compliance features can help you satisfy regulatory requirements and keep up with industry best practices. In turn, they can ease your administrative burdens, reduce the risk of non-compliance, and allow you to pay more attention to other areas of your business.

#6 Stronger Client Relationships

So far, we’ve talked a lot about how TAMPs can give you more time to focus on your clients. However, TAMPs can also carry out crucial client communication on your behalf.

For example, many TAMPs share real-time portfolio updates with your clients, cultivating greater transparency and trust. Some TAMPs also feature client portals and self-service dashboards, enabling your clients to access their information 24/7.

These TAMP advantages can save you time and enhance your client satisfaction and long-term loyalty.

What Are the Potential Downsides to TAMPs?

Despite TAMPs’ many benefits, they also have some potential drawbacks to be aware of. These downsides include:

Cost – While leveraging a TAMP will almost always be more cost-effective than maintaining an in-house asset management team, you need to make sure the fees of your chosen TAMP align with your firm’s budget and business model. SharpeMetrix addresses this with transparent flat-fee pricing.

Loss of control – By outsourcing your asset management, you naturally lose some control over day-to-day investment decisions. This may present some challenges, particularly if you have a strong investing philosophy. SharpeMetrix provides full transparency into our systematic methodology, so you always understand exactly how portfolios are constructed.

Limited customization – While many TAMPs offer comprehensive customization options, they may still be more limited than what you could do with an in-house team. As a result, you may not be able to accommodate highly specific client requests.

Client perception – Some clients may have reservations about allowing a third party to manage their investments. You can put their minds at ease by addressing their concerns early on and explaining the advantages of using a TAMP, such as access to professional managers, diversified strategies, and improved service quality. SharpeMetrix’s systematic approach often resonates well with analytically-minded clients who appreciate data-driven decision-making.

Differentiation challenge – Many TAMPs rely on similar strategies, making it difficult to differentiate your practice. This is where SharpeMetrix excels—our proprietary alternative data signals provide genuine differentiation that clients can’t get elsewhere.

Who Should Use a TAMP?

TAMPs may not be suitable for every advisor, but the majority can benefit from their efficiency, scalability, and time savings.

Here’s a closer look at who can benefit the most from leveraging a TAMP:

Advisors who want to focus on client relationships and financial planning – If your main priority is financial planning, managing assets can be a time-consuming distraction. You can dedicate more time to client engagement and personalized planning by offloading your asset management duties to a professional team.

Small-to-medium-sized firms – If you’re running a smaller firm, you may not have the resources to manage complex investment portfolios in-house. A TAMP can connect you with cost-effective, high-quality portfolio management so you can offer your clients a wider range of investment strategies and compete with larger firms.

Growth-minded advisors – Business growth is much easier to achieve and sustain when outsourcing your asset management to a TAMP. You will have more time for marketing and prospecting, and you can trust that your new clients’ portfolios will be managed with professional expertise and consistent oversight.

Advisors seeking differentiation – If you’re tired of offering the same strategies as everyone else, SharpeMetrix’s alternative data-driven approach provides genuine differentiation. Our systematic methodology gives you a compelling story to tell prospects about why your investment approach is different and better.

Advisors experiencing burnout – As a financial manager, attempting to do it all can add unnecessary stress to your plate and contribute to burnout. In part, this is why 80% to 90% of financial advisors leave the industry within three years. Strategic outsourcing can improve your business outcomes and restore some much-needed work-life balance to your career, allowing you to thrive in a field where many struggle to stay afloat.

If you fall into any of these categories, you may be the ideal candidate for a TAMP. However, outsourcing ultimately depends on your specific needs, goals, and business structure.

Comparing Your Options: Traditional TAMPs vs. SMAs vs. SharpeMetrix

When evaluating portfolio management solutions, you have several options:

Traditional TAMPs – Offer efficiency and scalability but often rely on generic strategies that don’t differentiate your practice. Percentage-based fees compound as you grow.

Separately Managed Accounts (SMAs) – Provide quality active management but come with high fees, manager risk, and limited differentiation. Learn more in our SMAs vs TAMPs comparison.

SharpeMetrix – Bridges the best of both worlds:

• TAMP efficiency and scalability
• SMA-level sophistication and differentiation
• Flat-fee pricing that protects margins
• Systematic approach that eliminates manager risk
• Proprietary alternative data that generates alpha

Common TAMP Hesitations (And How to Overcome Them)

If you’re still on the fence about adopting a TAMP, you’re not alone. Common concerns include:

• Justifying additional fees to clients
• Loss of control over investment decisions
• Uncertainty about fiduciary responsibility
• Impact on client relationships
• Complexity of implementation

We address all of these concerns in detail in our guide: Why It’s Time to Overcome Your TAMP Hesitations.

The short answer? These concerns are valid but surmountable—especially when you choose a TAMP that aligns with your philosophy and provides genuine value differentiation.

Revolutionize Your Practice With SharpeMetrix

Turnkey asset management programs can transform your efficiency, scalability, and client satisfaction. By outsourcing investment management and back-office tasks, you can free up time to focus on what matters most.

SharpeMetrix stands out for its ability to streamline your operations while delivering a differentiated level of service. When you choose SharpeMetrix, you gain access to:

Institutional-Quality Alternative Data – Earnings expectations, sentiment analysis, and innovation signals that provide genuine alpha generation opportunities

Enhanced Quantitative Factors – Value, quality, momentum, and volatility factors refined beyond generic implementations

Systematic Approach – Rules-based methodology that eliminates manager risk and ensures consistent factor application

Flat-Fee Pricing – Transparent pricing that protects your margins as you scale

Full Transparency – Complete visibility into methodology, holdings, and performance attribution

Scalable Solutions – Built to grow with your practice without adding unnecessary overhead

By choosing SharpeMetrix, you ensure that your practice has access to top-tier investment management expertise while maintaining the efficiency and scalability that TAMPs provide.

Next Steps:

• Explore 14 essential TAMP features
• Learn how to overcome TAMP hesitations
• Compare SMAs vs TAMPs
• View our live model performance

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