What to Expect from Wealth Management Platform in 2020?

Posted on December 18, 2019November 15, 2022 by Valuefy

2020 promises to be a year of fundamental shifts for the Wealth and Asset management industry. The evolving technology landscape and digital transformation of the industry will lead to a number of significant changes in the way that wealth managers operate. Here are some of our predictions for the coming year.

Costs to stay in Business will remain high, Platforms will find new Efficiency

The costs of complying with regulations in the wealth management space will remain high. The growing cost of doing business will put continued pressure on firms to drive up profits. However, competition pressures will lead to lowered fees and cannibalization of the market. In this scenario, wealth management firms will have to invest in technology such as wealth management platform and data to maximize alpha for customers and justify higher management fees.

Passives will become core Investment Channel, Platforms will help Wealth Managers compete

It is predicted that by 2020 close to 35% of assets under management will be pooled into passive investment products such as index funds. ETFs and Mutual Funds will also see steady growth. As investors increasingly invest in passive products, actively managed funds will be under pressure to show a higher alpha. This higher alpha can only be generated if investment decisions are made on hard data that helps wealth managers make quick and reliable judgment calls that can beat the market. The power of terabytes of historical data can be leveraged by wealth managers that use Robo-advisors. These Robo-advisors can give recommendations in real-time and can raise red flags when portfolios are not performing. This will help de-risk investment strategy and help increase the chances of creating value for clients.

Platforms will help Wealth Management Firms improve transparency and gain Client Trust

Clients of today expect transparency in investment decisions. They are no longer happy to rely on Wealth Manager’s decisions alone and need hard data backing up any investment strategy. Wealth Management platform gives wealth managers all the data they need at their fingertips. This means that the chances of making decisions purely on instinct are greatly reduced, this fosters greater trust in the clients. Clients can also use Wealth Management platform to check their portfolio performance at any time 24X7 and ask the Wealth Manager questions proactively instead of waiting for a monthly call or meeting.

Platforms will help meet higher expectations of On-demand Customer Service

Clients who have grown familiar with an ‘app economy’ expect service to be available to them 24X7. In such a scenario, wealth management platform that helps customers get visibility into their portfolio data will give an edge to ‘digitally enabled’ wealth management firms. These platforms also help in automating mundane front office and back-office tasks helping free up manager time to focus on strategy and servicing their customers. This is especially crucial in a climate where over 87% of HNI clients confirm that they switch wealth management firms for lack of satisfactory customer service experience.

Mobile Apps and Customer Portals will become par for the Course

Clients of today are increasingly tech-savvy and need access to their portfolio data on their fingertips. Wealth management platform can no longer be solely facing the wealth manager, they need to have a customer-facing presence both as a portal and as an app. These mobile apps must have key functionalities such as rebalancing, portfolio monitoring, withdrawals, etc so that customers are empowered to make their own decisions. Investing in online platforms and mobile apps should be a top priority for Wealth Management firms as less than 50% of HNWI reported being satisfied with their current online and mobile financial platforms

Predictive analytics in wealth management The new normal

Posted on October 14, 2019January 2, 2024 by Valuefy

The wealth management landscape is ever-evolving and wealth management firms of today are increasingly adopting cutting edge technology to cater to tech-savvy millennials. The expectations and preferences of today’s clientele such as increased insights, automation, and 24X7 customer service can only be met by leveraging smart tech.

Investment managers of today are investing in wealth management platforms with AI-enabled advisory and predictive analytics to cater to these demands. The latest report by BCG on the wealth management landscape stated that 75% of wealth management firms are investing heavily in big data and analytics to meet evolving customer demands.

One of the major innovations in the space in the last decade is predictive analytics, which basically means the use of historical data to determine and predict the relationships between different variables in the wealth management process. Predictive analytics helps build models and processes that optimize the wealth management process, introduce high automation, and predict asset failure.

Predictive analytics is a space that is seeing huge growth in the market due to the value they provide to wealth managers in terms of cost savings and process efficiency. Using predictive analytics at different stages of the customer funnel is helping wealth management firms keep pace and deliver the coveted ‘high touch’ experience that clients have come to expect.

Here’s how predictive analytics is transforming the wealth management space:

Aligning business strategy

Predictive analytics helps wealth management firms anticipate investor demand, life events, attrition, investment patterns and more. This can help firms align their business and their product offerings according to this data to limit attrition and improve investor retention. It also helps firms understand investors with the highest risk of leaving and the highest lifetime value, so the managers can take appropriate action and effort to minimize the risk to AUM.

Data-driven intelligence

Robo advisory is being offered as part of the wealth management services which recommends portfolios for each financial goal by blending Robo capabilities with human intelligence. This automation helps in streamlining the process for wealth managers by eliminating redundant tasks.

Smarter client acquisition

Predictive analytics enables wealth management firms to customize their products and offer more targeted services to their clients. It enables them to recognize HNI clients and create custom investment opportunities for them. It also helps drive customized, personalized. and intelligent customer communications. From email communications, sales calls or message communications, analytics helps personalize them to offer a seamless experience leading to higher client acquisitions.

Exceptional customer service

Predictive analytics helps wealth managers give customers contextual advice. It helps wealth managers predict customer needs and approaches them with the right solution at the right time. Big data can be used to mine customer behavior through surveys, market patterns, risk levels and more to help provide tailored advice that customers appreciate. It also helps wealth managers make real-time recommendations, investment ideas, and financial plans in minutes, instead of hours.

Helps the research process

Predictive analytics and NLP can help asset managers make sense of vast unstructured and structured data sets. It can help managers understand patterns and trends in the data and make smarter decisions based on this research. This helps asset managers save on hours of time that they would have spent parsing through the data.

Higher visibility into operations and reduced costs

Digitized wealth management platform will help wealth management firms optimize processes and reduce back-office costs through better human capital management (optimizing hiring process), optimal demand management (optimizing effort based on customer lifetime value), and reduce due diligence costs through next-generation digitized KYC. These optimizations will help keep firms competitive and help the bottom line in this cut-throat market.

What does the future look like?

As wealth management platforms grow more and more sophisticated, the high investment in AI-based models means that they will become even more accurate. This means that investors can expect more personalized and better service from their advisors. Wealth management firms will be able to leverage these insights to create better opportunities and drive superior performance for investors. Firms that fail to leverage analytics will underperform and eventually will not be able to keep up with their tech-savvy competitors. However, those who do invest heavily in AI at this stage will capture a lion’s share of the millennial investor base.

Here’s Why you Need Hybrid Advisory for Investment Management

Posted on September 23, 2019December 8, 2023 by Valuefy

The introduction of Robo Advisory has received mixed reactions from wealth and investment managers.

While the tech-savvy managers have been quick to appreciate the value of this automated process, others assumed that this technology will make their jobs redundant in the future.

What is Hybrid Advisory?

Understanding the flow of money and making decisions based on the movement of the market comes with years of experience and in-depth research of assets, portfolios, and the market itself.

With the help of Robo Advisory, Investment Managers can recommend tailor-made portfolios for each financial goal, fasten the tedious task of onboarding customers, generate intelligent insights and rebalance portfolios with ease.

It adds an edge to advisory through intelligent portfolio insights, becoming an addition to the Investment Manager’s arsenal.

So, should Investment Managers be concerned about Robo Advisory?

On the contrary, they have reason to rejoice, because Robo-Advisory by itself is just a sophisticated product but partner it with an investment manager and what you have is Hybrid Advisory.

Here’s why:

It Improves Decision-Making

This is a collaborated approach to investment with the use of technology and human intelligence. The Robo advisors scan through terabytes of data to convert it into actionable insights.

It helps in leveraging big data to simplify the decision-making process in a cost-friendly way. The time which remained a constraint for investment managers is strategically handled by automating the operation procedures.

It Democratizes Investment Management

Wealth Management and Investment advisory have always been luxuries that only the affluent could afford. People who had amassed wealth over the course of their entire careers would go to wealth managers and investment managers for advice on where to invest their money.

Now, automated advisory for smaller amounts can take care of the clients that are in the primary stage and are still getting used to the market. Investment Managers can have potential clients in the pipeline long before they speak to them.

Valuefy is helping Investment Managers get on-demand, comprehensive analytics from historical and real-time data to make informed decisions generating better returns on the investments.

Valuefy is a FinTech company that enables Wealth Managers and Investment Managers with technological solutions to ensure the digitalization of their processes and empower them with comprehensive analytics, Portfolio Management solutions, reporting, and relationship management

5 Reasons Wealth Managers need a Technology Partner

Posted on September 18, 2019January 9, 2024 by Valuefy

Maybe you are a veteran Wealth Manager, a rookie or somewhere in between. Being in the industry, you must have heard about the disruptive technologies that are changing the sector of Wealth Management.

Well, the news is true as Wealth managers around the world are partnering with Fintech companies to adopt innovative technology solutions. It’s improving the efficiency and productivity of their firms and driving their performance.

Let’s take a look at the 5 major reasons why a Wealth Manager needs a technology partner.

Automation

One of the biggest advantages of technology is automation. Technologies like Big Data, Analytics, and AI are offering real-time data, easy access to information, and faster report generation which cuts down the time taken for decision making.

Automation in Wealth Management allows you to finish time-consuming tasks, like generating portfolio insights and reports, in minutes. It enables smoother operations making your job a lot easier. A ROBO assist platform aids Wealth Management in generating portfolio insights and collecting data in an organized way that also leads to a reduction in costs.

Customer Relationship Management

Customer relationship management is at the heart of a successful Wealth Management firm and it can be enhanced using user-friendly technological solutions that provide both ease and accessibility to the portfolio and analytics.

A technology platform, like Wealthfy, adds convenience to processes like Client Onboarding, Portfolio Construction, Portfolio Monitoring, Reporting, Analytics, and Rebalancing. Providing customers with on-demand analytics is another feature that can prove to be very inviting for a wealth manager.

Data Analytics

Wealth Management is built on data. Analyzing and studying historical and real-time data is a crucial part of making decisions that drive returns. Technology platforms perform these functions quickly while increasing the productivity of Wealth Managers.

Solutions that provides analysis of different classes of Assets in a portfolio helps you decide on the expected returns and risk factors of various assets under one platform. Moreover, these platforms support different styles of portfolios, widening their functionalities.

Multichannel Delivery

Smartphones have helped in garnering a deeper penetration across the market. The company-customer relationship has become more personal, making it easier for customers to reach out to the companies more easily.

This has increased the expectations of the consumers who now want to have multiple delivery channels to stay updated on the go. Effective mobility solutions can make this possible by integrating mobile-based solutions into the legacy systems at the Wealth Management firms allowing your customers to keep track of their portfolio and receive prompt alerts.

Customization

When you customize your platform for your workflows, you make its adoption easier for your customers. It helps you customize advisory and recommendations based on the goals set by the client. This individualistic approach provides a personalized service without taking much time.

Why is the Technical Evolution Welcomed?

The world is changing faster than ever before and this evolution does not intend to cease. Catching up with intelligent technological solutions will only enable you to serve your clients faster and with more precision.

Today’s Wealth Managers are seeking intelligent technological solutions that understand their requirements and aid in bringing down costs, time and an increase in their productivity. Overall help them predict better that in turn help them service their client needs better.

Valuefy is a FinTech company that enables Wealth Managers with technological solutions to ensure the digitalization of their processes and empower them with comprehensive analytics, Portfolio Management solutions, reporting, and relationship management.

Hybrid Advisory Model: The Future of Wealth Management lies in Man-Machine Collaboration

Posted on March 17, 2019October 20, 2023 by Valuefy

The thought of Robots and Artificial intelligence eventually replacing us and taking our jobs is a frightful one for all of us. However, beyond this fearmongering, there’s the simple truth that Artificial Intelligence is definitely much quicker than human beings at some tasks such as complex computations while humans are better at intuition.

The Wealth Management industry is currently undergoing a sea change as it moves from traditional methods to adopt the final frontier of technology adoption including AI, Big Data, Analytics, and Robo-advisory. However, the human element of customer service and ‘gut instinct’ can never be replaced and Wealth Management firms are seeing the rise of a new model, namely the ‘Hybrid advisory’ model.

What is the Hybrid Advisory Model?

Hybrid Advisory takes what’s best about both the worlds (human and robot) and puts them together in one basket. Machines being inherently quicker than human beings at computational tasks, wealth management firms are using wealth management platforms and robo-advisors to comb through terabytes of data and convert it into actionable intelligence and insights. This tempers the tendency of advisors to make purely instinct based investment decisions and helps them leverage the power of data to derisk their decision process.

The increased efficiency of the model helps a single wealth manager optimize his daily activities and automate operational tasks by around 60%. This helps make Wealth Management more accessible, flexible and cost-effective and reduces the human effort associated with each customer improving the scalability of your wealth management practice.

What are the different kinds of Hybrid models being adopted?

There are three kinds of Hybrid advisory models that banks and wealth management practices are adopting based on client demographics, portfolio types and specific requirements and demands of the client base.

Digital advisory model:

The Digital advisory model offers the customer simplified financial services to customers as a DIY digital service. This makes investing more economical for mid-size or smaller investors as the commissions, as well as the minimum asset requirement for investing, are quite low.

In this model, the human advisor is involved only in the initial phase of guiding and setting up the portfolio, and the investment goals after which the digital platform or robo-advisor takes control. Digital advisory is usually based on passive investment instruments such as ETFs or index funds. The major benefit of a digital advisory model is that the customers have the flexibility to move towards the ‘High touch’ model with more human advisor involvement as their assets grow and management needs become more complex.

Scalable advisory model:

The scalable advisory model enables the robo-advisor and the human advisor to serve “mass affluent” clients economically and with efficiency. The scalable advisory model generally employes the robo-advisor purely for insights and to drive transparency while the final investing decisions are actively made by the human advisors.

In the scalable advisory model, the human advisor creates the financial plan, configures the roboadvisory, helps in investment decisions and manages complex financial instruments. This gives the client a balance between digital services as well as access to a human advisor for major investing decisions. The scalable advisor model is generally preferred by tech-savvy investors who value the skillset of human advisors as well the transparency and monitoring capabilities afforded by robo-advisors and wealth management platforms.

High-touch advisory model:

The ‘High touch’ model is made specifically for HNI clients with complex financial needs and larger assets under management with a tailored experience. In this model, the financial advisors usually take complete control of the Wealth Management platform and the clients get access to a client app where they can monitor their portfolio at all times.

Advisors use the platform to optimize and automate operations so that they can invest more time in exceptional client servicing and client relationship meetings. In this model, the data and analytics insights provided by Robo-advisors are used to power insightful conversations with HNI clients who are starved for time as well as to prepare detailed portfolio reports. Human wealth managers in the ‘High touch’ model offer full-scale advisory services such as succession planning, real estate planning, retirement planning, advice on annuities, alternative investments and more.

The Indian Wealth Management Landscape: Moving towards ‘High touch’ experiences

Hybrid advisory models offer both investors and wealth management companies several benefits such as the lowered costs of advice, high scalability in service models, data-driven financial advise as well as the ability to monitor portfolios 24X7.

In the face of Indian HNIs picking up on global cues and demanding world-class technology from their wealth management firms, Indian banks are turning to Fintech partners for a solution. Valuefy, India’s pioneer investment technology company is leading the digitization charge for market leaders such as Kotak AMC, Reuters, WGC and Aditya Birla Group and helping them deliver the coveted high touch experience to their HNI clients.