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Beyond 2021: Changing Trends In Wealth Management

Client demographics are evolving. Big tech has contributed to the growth of a well-informed generation, changing the Dublin wealth management ecosystem. With a more demanding client segment and tech-savvy investors, wealth management firms are enhancing their capabilities quickly to seize the moment. Let’s look at these trends and how they affect the product offering:

1. Reports with a digital experience

Clients want fast access to their portfolio reports, in an easily digestible format. It’s no longer just about providing a digital version of the conventional paper-based reports. Wealth management Dublin firms are now focusing on intuitive and customized interfaces that clients can engage with to access dynamic reports.

2. IoT and personalized advice

Wealth management is getting hyper personalized. Data analytics technology currently available already enables the firmsto leverage on their customer data to get insights that are in line with each individual. As the trend moves to automated portfolio management, IoT devices will collect real-time data with insight into the clients' lifestyle, such as saving and spending habits. Analyzing this information then shows the risk tolerance of the client, making onboarding smoother.

3. Debiasing in active funds

Investment decisions based on intuition can have occasional successes, but the drawback – should it not pan out as expected, can lead to heavy losses. This is one of the factors that has contributed to reduced profit margins of actively managed funds, turning clients away to passive index funds. However, machine learning is increasingly being adopted, with the debiasing techniques involving loads of data being crunched down to show if the decisions being made are driven by emotions, which then trigger alerts. By changing cognitive biases and setting up corrective measures, wealth management firms are well-poised to create winning strategies that go for the long term.

4. Impact investing

With more investors embracing sustainable investing, there is increased asset allocation in line with the clients' ESG (Environmental, Social Governance) requirements. Wealth managers providing these strategic investment opportunities have the competitive edge, securing a long-term presence in the niche.

5. Gamification

No, managing your portfolio is not a game. Here the focus is simply on the tools used to engage clients, especially the millennials who are forming an increasingly larger portion of the clients. Aspects of game playing, like using virtual reality and augmented reality to make the portfolio management more intuitive and influence the behaviour of clients, attracts more of them into the market. The goal is twofold: make it easier for the investors to understand the different niches where their wealth is being put to work; as well as enable the wealth management advisors understand the client's needs better.

6. Tech and regulatory compliance

Managing portfolios across different jurisdictions and meeting regulatory requirements can get costly - especially since the rules keep on changing. Take Europe's General Data Protection Regulation (GDPR) and USA's Fiduciary Rule for instance. These focus on data governance, and wealth management companies have had to invest in tech solutions to streamline their operations. Managing liquidity risk is another key aspect of compliance. From automating reporting tasks to getting solutions with dashboards where liquidly can be easily monitored – the different solutions will enable the firms to respond faster to changes in regulations. This reduces operating costs, and the benefits can then be passed on over to clients through higher returns on their portfolios.

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Contact us today and book your consultation and see how Quigley Financial Brokers can help you choose the best options available or contact for further information.


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