While financial technology is often the subject of fanciful thinking and star-gazing, expert Paolo Sironi paints a credible and comprehensible picture of the robo-advising, goal-based investment and gamification that are transforming the investment industry. He captures the disruption happening in asset management and offers an attractive alternative business model for investment advisers and wealth managers under pressure to change. Though more examples of these innovations would have been useful, readers looking for a better handle on investment fintech will find this a good guide.
A “perfect storm” of information, indexing and regulation is battering the investment and wealth management sector.
A number of diverse factors are combining to create an existential threat to the investment and wealth management industry. Predictably, as in many other sectors, digital data, the internet and mobile technology are front and center in this disruption. Where once wealth managers could enjoy the age-old privilege of information asymmetry, now the internet has democratized this advantage and washed away lucrative barriers to entry. The former mystique of stock picking and investment planning has come under the glare of the internet, with its instantly available historical comparisons and visual representations.
As a new, digitally literate generation inherits wealth from baby boomers, investment customers are becoming more tech-savvy, at ease with harnessing freely available information and more comfortable managing their investments without expensive professional services. Meanwhile, the poor showing of financial institutions during the 2008 financial...
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