With so much focus these days on the health of our economy, international trade negotiations, and federal interest rates, it’s easy to forget the other wealth management trends that are shaping the future of financial markets and the impact these changes are having on the wealth management industry. Investors’ needs are evolving as growing access to seemingly endless information online places them in the driver’s seat. This digitally-driven world that we live in has spilled over into financial management, and investors are more financially and technologically savvy than ever.

Consequently, the role of financial technology (fintech) has increased the availability of secure financial services online. Mobile phone-based applications provide more convenient ways for consumers to fulfill their banking needs. For banks, it has decreased the demand for in-person service and customer service calls, which translates into lower operational costs. Likewise, fintech is changing the relationship between wealth managers and investors. Advancement in machine learning and robotic process automation (RPA) is at the forefront of wealth management trends. Investors are searching for more day-to-day agility and independence with their financial health, with the help of digital solutions.

Machine learning and robotic process automation (RPA)

High profile criminal cases in recent years involving insider trading has spurred the faster development of technologies that can detect fraudulent activities. The machine learning platform by Feedzai was designed to end financial crimes. Banks are investing billions into companies that develop preventative solutions because of the rise in regulatory, business, and financial risks from trading platforms.

A technology called natural language processing (NLP) monitors phone calls to and from a trading desk. It can even detect the emotions and intent of participants in those calls. A company called Fingenius develops this technology. More companies are developing artificial intelligence (AI) solutions that address the need for financial institutions to automate low-value tasks. What’s amazing about AI technologies is that they become more accurate over time as they learn from patterns and variations in human behavior.

For years, we had optical character recognition (OCR), which recognizes letters and translates it into editable text. Now, we have computer vision technology (CVT), which recognizes edges of images in photos and textures of objects. Most people are familiar with Facebook facial recognition. However, companies like Syte.ai, TheHive.ai, and Intel produce machine learning technologies that can help to prevent fraud and generate customer engagement user experience (UX) online.

The holistic customer experience (life coach)

For many years, high net worth (HNW) and ultra-high net worth (UHNW) investors received most of the “high touch” wealth management services. The landscape for wealth management firms is growing more competitive with direct investing opportunities and robo-advisors. Now, more technologically savvy than ever, even mass wealth investors want more out of the fees they pay for advisory services. Individuals and families are looking for their wealth advisors to model the roles of life coaches. And, that is a wealth management trend, isn’t it? When a wealth manager provides a holistic customer experience, they’re asking questions and considering many different personal aspects of their clients’ lives

Exceptional anytime, anywhere financial controls

Firms that are at the forefront of these increasing demands skillfully combine tested wealth management tools with advanced investment applications. The client app is integrated with the application programming interface (API) at the wealth management firm that allows them to take more ownership of their financial health. People are expecting to be able to view all their brokerage accounts in one place, eventually. They want to be able to communicate electronically with a wealth advisor and transfer funds as easily as they shop on Amazon and find music to download in the iTunes store.

Product and services predictions

The competition is rising among wealth management firms as more investors are taking retirement and financial planning decisions into their own hands. Companies like Fidelity, Vanguard, and TD Ameritrade are also offering several investment products with zero fee trades and funds with near-zero percent management fees. There are always investors but finding them will prove to be more of a challenge in the coming years.

In the world of AI, however, there’s a company called Sequential Quantum Reduction and Extraction Modeling (SQREEM). SQREEM logs behavioral metrics and acquires data on billions of consumers. The technology can build matchups between internet users and potential wealth management products. Some might understandably have concerns about privacy, but the applications of intelligent automation are seemingly endless.

Sorting through a shifting landscape

Wealth management as we know it is on the path to becoming a digitally managed ecosystem. It will be one that places integrated fund management services and much more visibility into the hands of the individual investor. San Francisco Bay firms like SD Mayer are aware of these wealth management trends and exercise a holistic approach and personalized advisory services. We would love to speak with you today about any questions you have about how fintech is changing financial institutions or how it might affect the way wealth managers and their clients will work together.

If you have questions about the evolving landscape of wealth management and how it will impact you, one of our experienced wealth advisors would love to talk to you. With decades of experience, our team can help bring you and your finances up-to-date. Contact us today to set up and initial consultation.

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