Robo advisors: How automated advisory services are reshaping the wealth management industry

HIGHLIGHTS

• After having transformed numerous industries, technological advancements and innovation have reached the wealth management industry and are promising a major overhaul of the way both wealth and client relationships are managed
• Robo Advisors are helping fill a significant gap by satisfying the unmet needs of smaller investors. A segment that holds a significant portion of the global investable assets pool that was not economically feasible to pursue and didn't have the necessary means to invest efficiently using traditional venues
• Automated advisory models, which started as machine only models, are morphing into hybrid models by re-introducing the human advisor element in multiple forms across the product offering. Machine-only models are becoming a commodity
• The investment management industry has always been at the forefront of technological innovation and the current ongoing transformation, short of being disruptive in the strict sense of the word, is a continuation of a long running trend that is aimed at keeping the industry profitable and viable.
• Although the human element's involvement is bound to decline with the vast adoption of robo-advisory models, the nature of the wealth management industry will always require human advisors and relationship managers to be available.