A New Advisory Model
A new type of client
Investors are increasingly questioning the value of the advice, level of services, and fees; at the same time, they have much greater expectations on the quality of the engagement, user experience, and transparency.
With a change in demographics, clients are placing much greater emphasis on real-time information, which can be accessed through multiple platforms (mobile, web).
A tighter regulatory environment is placing much higher demands on client interactions, disclosure and transparency.
Intensified competition is coming from larger firms, non-financial firms and automated robo services, and is providing more options for individuals and families to place their investments and obtain advice.
The new type of client, regulation and competition are making it difficult for advisors to justify high fees.
The new advisory model will be based on a transparent value-add practice, which redefines and builds long-term trust…
End-to-end workflow across the entire wealth management organization, and enhanced internal and client communications.
New reinvented business processes
Defined by individual goals and portfolios, not products; and organized around portfolio management, compliance, and communication.
Driven by analytics and rigorous risk management through a technology platform.
Personalized, high-value client engagement with increase communication and trust.
But… there is a gap in analytics technology that needs to be closed.
Leading-edge finance professionals working at the top investment banks, hedge funds, and institutional investment firms, have been using advanced risk and portfolio management analytics, and trading technologies, to their advantage for two decades.
Wealth managers and financial advisers have been typically at a disadvantage as they rely on outdated technology, limited analytics and workflow tools to manage their clients and portfolios. Unlike the Chief risk Officer in a bank, these professionals typically struggle to get an enterprise-wide view of their operations and clients, and to provide transparency for their individual investors. In addition, a high cost structure makes it more difficult for them to scale operations.
Robo Advisor technologies are too simplistic to base the new advisory model on. Their emphasis has typically been on lower fees and a simple investments. Thus, they offer little in terms of investment and and risk analytics, portfolio transparency, portfolio construction tools, investment process, and have limited financial product coverage. Also, by design, they typically miss one key business requirement: an enhanced “human-to-human” interface (adviser – client).