Online Brokerage Rolls Out Performance Tracking Tool

When Charles Schwab & Co. Inc. decided to offer a new Web-based tool that lets clients track the historical performance of their stock and mutual fund holdings, it required an exercise in database integration.

The online brokerage introduced its Positions Monitor two weeks ago. When clients log on to their accounts, they can track the performance of their holdings without having to key in information on each fund and equity, a feature Schwab says is a competitive differentiator--at least for now.

The system can assemble custom reports on the fly, integrating portfolio information culled from corporate databases and combined with data feeds from First Call Corp., Morningstar Inc. and Standard & Poor's ratings services.

By clicking on a holding displayed on their online balance, a customer can receive models illustrating growth potential as well as historical returns and risk factors, all broken down by asset class, the company said.

"It's an analytical portfolio-monitoring tool that makes tracking the performance of one's investments a much easier task," said Chris Kleinbauer, director of product development and electronic brokerage at Schwab.

Adding new features to sites is a routine occurrence in the online brokerage world, as are internal database integration efforts. But Schwab is the largest online brokerage with 2 million online account holders totaling $145 billion in assets and averaging $4 billion in daily online transactions.

Schwab officials said the new application did not require any major database overhauls or the development of a Java application. A simpler effort of internally assembling some CGI scripts allows data from multiple sources to be presented in a common Web interface. Indeed, getting it right was the bigger issue, Schwab officials said.

Before Schwab could roll out the tool, programmers in its electronic brokerage unit had to tweak its centralized customer information database, based on an IBM mainframe and DB2, and CICS Transaction Server and parse those records to a data mart based on an Oracle7.3 database.

New columns and rows had to be added to the customer database in DB2 to support feeds from First Call, Morningstar and S&P. However, a key issue was making sure that the market data was securely linked to the database.

"Customers are basing decisions on this information; you have to be careful that it's accurate data," said Alison Bomar, senior manager for electronic brokerage technology at Schwab. "We took security precautions to make sure the data was secure and couldn't be changed in any way." She declined to elaborate on what security precautions had been taken.

But like all new IT initiatives at Schwab, Positions Monitor had to be built in conjunction with the company's database architecture. Hence it required cross-organizational integration.

Because new columns and rows were added to support the new feeds in the corporate database, the database administrators worked with all of the organizations at Schwab to make sure the updates were suitable for others who might potentially use the data in those fields down the road. "These corporate databases supply information to many different sources throughout the company," Bomar said.

Then the data, including the customer records and the fields, were linked to the Oracle data mart. The market feeds are updated monthly, though the goal is eventually to provide daily revisions.

This process of handling database updates centrally is to assure consistency, Bomar said. "It's basically so we have a corporate data store of records that we use across the company," she said. When a department or division wants a piece of that data, "We work with them to build an architecture where we take an extract from that corporate database and pull it down to our local database that's used for applications that are relevant to investors."

As for performance, the current configuration is fine for now, said Schwab database administrator Chris Beckman. But over time, plans call for upgrading the data mart to Oracle8, she said.