AI emerges as a key tool for investors, wealth managers: report

Investors now prefer wealth managers who adopt new technologies.

In Singapore, investors look into using AI for investment guidance whilst wealth managers (79%) see AI as a key component for the future of the wealth management industry (83%), Avaloq reported.

According to Avaloq, 47% of investors have considered switching their wealth manager or bank.

The top reasons for this include weak portfolio performance (43%), followed by a lack of transparency and communication (31%), and a reluctance by the wealth manager to adopt modern technology (31%).

Avaloq revealed that 67% of investors say that seeing the impact of their investment decisions during live meetings is crucial for building trust in their adviser, whilst 65% value access to investment analytics and portfolio visualization.

When establishing trust between advisers and their clients, investors cite the ability to professionally manage the investment risk of the client portfolio and consider the client’s risk appetite as the top factor (77%).

On the flip side, wealth managers are dissatisfied with their technology systems with 62% saying their systems are hard to navigate, and 57%) saying that they need to use too many systems to complete their tasks and that data is not seamlessly integrated across all systems.

In addition, 67% of professionals believe their current systems are outdated with the top technology barriers being difficulty accessing client data (55%) and lack of client data analytics (52%).

Because of this, wealth managers struggle to adopt technology, with 29% still not using investment advisory tools in client meetings, whilst 92% say they would like the option to do so. However, 92% report that the user interface of their tools is not optimized for this purpose.