The New Clientele: How Women and Millenials are shaping the future of the Wealth Management Industry

Posted on April 20, 2019November 16, 2022 by Valuefy

Millennials and their approach towards finance

About 40 percent of the global adult population is under 35 years of age and this number is most likely to be doubled by 2020. Millennials also known as the Generation Y have a keen sense of understanding of how the market runs, have deep entrepreneurial ambitions and a have a better understanding of investment when compared to the Baby Boomers.

Millennials have a short term and quick returns oriented approach when it comes to wealth management and planning, and this reflects in their interest in investing in emerging technologies and markets like Blockchain and Cryptocurrency.

According to a recent study, millennials believe in a cashless economy of which 33% do not believe in the need for the existence of a bank. The savings models, however, are still largely cash-based with more than 52% relying on cash-based savings.

Rise of a self-taught and data-centric user base:

Millennials are the future wealth management clientele and Financial organizations are now finding ways to cater to this intelligent, inquisitive, and self-service based user groups by relying on technology-based platforms to offer its users a wealth management applications that inspire transparency and trust. Technology platforms also allow full access of the functionalities to its users such as portfolio monitoring, analytics, and recommendation.

Wealth management companies are now adopting an analytical approach to cater to this generation of users by providing insights that are actionable, resourceful, and are available at their disposal with increased convenience.

Millennials as a generation strongly consider the social presence of any company to create a persona before investing in them mentally or economically.

Financial institutions in the wealth management space must fine-tune their current legacy systems to morph into a system that is in sync with the current consumer base as delay will only increase the cost of conversion or impact the company by losing its clients to early adopters.

And this is where Valuefy’s award winning wealth tech solutions are helping empower private banks, wealth management companies and family offices to serve their investors better!

The New Normal in Wealth Management

Posted on March 30, 2019October 20, 2023 by Valuefy

The COVID-19 pandemic has had a profound impact on the wealth management industry. Many of the trends that were already underway, such as the rise of digitalization and the shift to personalized advice, have been accelerated.

In the new normal, wealth managers will need to focus on the following key areas:

Digitalization: Wealth managers need to embrace digital technology to improve the client experience and operational efficiency. This includes offering online and mobile access to accounts, as well as using artificial intelligence (AI) and machine learning to automate tasks and provide personalized insights.
Personalized advice: Wealth managers need to shift from a product-centric approach to a client-centric approach. This means providing clients with personalized advice that is tailored to their individual needs and goals.
Risk management: Wealth managers need to help clients manage their risks in a volatile and uncertain environment. This includes developing risk management strategies that are aligned with each client’s individual risk tolerance.

In addition to these key areas, wealth managers also need to be aware of the following trends:

The rise of the mass affluent: The mass affluent segment is growing rapidly, and wealth managers need to adapt their offerings to meet the needs of these clients.
The increasing diversity of clients: Wealth managers need to be prepared to serve a more diverse range of clients, including millennials, women, and immigrants.
The growing importance of ESG: Environmental, social, and governance (ESG) investing is becoming increasingly important to clients. Wealth managers need to be able to offer ESG investment solutions and help clients understand the impact of their investments.

How Valuefy can help wealth managers adapt to the new normal

Valuefy is a wealthtech platform that can help wealth managers adapt to the new normal in a number of ways. Valuefy’s platform can help wealth managers to:

Digitalize their operations: Valuefy offers a variety of digital tools and solutions that can help wealth managers to automate tasks, improve the client experience, and gain insights from their data.
Provide personalized advice: Valuefy’s platform can help wealth managers to develop personalized financial plans and investment portfolios for their clients. Valuefy also offers insights and recommendations that can help wealth managers to provide better advice to their clients.
Manage risk: Valuefy’s platform can help wealth managers to develop and implement risk management strategies that are aligned with each client’s individual risk tolerance.

Valuefy’s customers include wealth managers, asset managers, and private banks. To learn more about how Valuefy can help you adapt to the new normal in wealth 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.