Tag Archives: wealth management

The future is now: artificial intelligence and wealth management

Think about this situation. Imagine that you are client of any wealth manager and the staff sends you a report about the best chances for your investments, with recommendations and comments to obtain the best performance. Then, you talk to a friend, who is also client of the same wealth manager and you both comment about the report. You discover that both reports are personalised and are not the traditional recommendations’ standardised reports that these entities publish regularly. Each one have personalised information and you both discover that the entity has used your full data to design the best report to meet your needs. Then, you explain your friend several changes in your investments. Both have the same risk profile, but your portfolios (and the historic operations) have nothing to do to another.

The example could be larger, but it is enough to introduce the changes that we will live soon in the wealth management branch. The expression behind these changes is artificial intelligence. Shortened as AI, it is not a Steven Spielberg film. It is far from fiction, because it is reality. The learning capability of machines increased exponentially in the last years and the soar will keep on. There is a combination of big data analysis, natural language and machine learning. Big data analysis provides the capability of learning better not only about the customer, but also about any trend that goes around him. Natural language allows machines to interpret and generate spoken and written language. Machine learning uses algorithms that can learn and make predictions on data.

This will be the mix that we will see growing in the next years. The transformation will be deep in the whole financial sector. Currently, a 26% of assets and wealth manager firms already use AI to inform the next big decisions, according to PricewaterhouseCoopers. Money is flowing increasingly there, because all agree that this will be the next step for fintech business.

For instance, natural language processes will help comply better with regulations, as machines will learn immediately the changes and adaptations will be easier in platforms. This will also has a very relevant collateral effect managing risks more efficiently. The client will obtain a high-improved user experience with new interfaces. The advisor tasks will focus in asset gathering and portfolio monitoring. They will also become more responsive to client needs and increase the added value of their services.

Robo-advisor in the first deep step in this change. There will be further changes with a greater automation. Robo-advisors and human advisors will experience several transformations in their tasks and roles against clients. They, the clients, will be winners and the only losers will be entities (not only human, also fintech) that will not adapt to the new wave.

There are many transactions that you can do with your portfolio in T-Advisor

We have a very long experience providing financial tools for investors. That’s why we publish regularly posts about our solutions, because we have always detected that users do not take advantage of many gadgets, features and details developed for them to a better management of their portfolios.

Do you know what kind of financial transactions you can do in T-Advisor? Let’s say that you have your portfolio and you add some assets: either stocks, ETF or mutual funds. The usual operations are “buy” and “sell”. Those are easy, but there are quite a lot of them. Think about that:

  • If you have funds, you maybe think to transfer from one to another. There are transactions of buy and sell, but transferring the money, not a payment or refund with cash.
  • What about stock dividends or bond coupons? If you receive those payments, you have to register that increase of capital.
  • In the case of bonds, they can be cancelled or they can expire, with the subsequent effects in your portfolio.
  • Again, what refers to shares or ETF, there can also be splits and sold of rights.
  • However, there are also movements linked to cash, because a portfolio has an associated account. Let’s only think about the different charges that you can register. We show you in this list:

Cash operations in portfolios in T-Advisor

Not bad, huh? T-Advisor has several functionalities that deserve to speak with more details. These are some of them. An investor need a tool that has the right features to register all kind of movements related to his or her assets. This is the way to improve your independent wealth management. This is a reason why we say that we make available professional tools for self-directed investors.

ETF, the asset revolution has consolidated

Exchange Traded Funds, or ETF by its initials, are the trendy security in the last years. Their assets have doubled in the last five years, as this BlackRock chart shows, although there is a reduction in January 2016, because of the general volatility of the equity markets:

Global ETP assets by year. Source: BlackRock

ETF are there to stay. There will be no reversal. In this short history (although they exists since the end of the 1980’s), there have been a few entities that have specialised in creating and selling these products: iShares by BlackRock, Vanguard and State Street, as the following table shows:

Global ETP providers. Source: BlackRock

But why are ETFs so successful? Why is there an offer from a few to 1,800 different products in so short period of 10 years? Flexibility, low fees and trading like stocks are some of the advantages against traditional mutual funds. Although there are also some disadvantages, investors still look at them as a very attractive asset. The explosion of them as a business contributed to create a long list of specialised media in Internet, because professionals and individuals have been looking continuously for information about them.

The design of an ETF is very different depending the cases: equities, fixed income, money market, commodities… They replicate an index or track a collection of securities or sectors in the known as passive management. After creating the product, there are only some adjustments every certain period, but the product performs independently of the manager.

In T-Advisor, our Watchlist has a long list of ETF categorised by their strategy for our registered users:

T-Advisor ETF Watchlist

It is just an option, but it is interesting to consider because of its price transparency linked with diversification. You invest in a diversified product, that means that you reduce some risks, and you have steady information of the price fluctuation, against mutual funds, whose prices are updated when markets are closed. In costs, they are cheaper than mutual funds. Yes, they are more expensive that a share, but you have to consider the above-mentioned diversification.

This is probably the reason of the success: the combination of the flexibility and transparency of a share and the diversification of a mutual fund. A survey conducted by EY in 2014 already talked about the promising future of ETFs amongst wealth managers and invertors. That future is already here.

T-Advisor, the reference for professional investors

Jaime Bolívar, T-Advisor general manager

“The secret of the wealth management lays on quality accurate data and exceptional technological performance. This is the real compass for professional investors”, says Jaime Bolívar, general manager of T-Advisor.

Bolívar speaks in the interview with the passion of an entrepreneur who always looks beyond in technology and finance. “Financial tools have to be accessible, easy to set, with clear charts and figures. We are living a time in which Internet has opened a lot of sources and some people says that you can find all kind of data for free. But information for professionals has a price. We are offering tools with accurate data and systematic analysis for a very competitive price”.

Since the launch of T-Advisor, the solution has two different packages: for individuals and for professionals. “We set this two packages because we really believe that finances have to be available for all. Everyone has the right to invest with high-quality tools, follow up their results, take decisions to change and rebalance their investments. A world controlled by a privileged group who has access to information and understand it to act in the markets is over”.

With the professional package, T-Advisor offers an advanced suite for professionals with several advantages: open amount of portfolios, up to 100 positions, 20 year historical data, reports, watchlists, alerts, risk analysis, investment alternatives, portfolio optimizer and a costumized universe for stocks and funds. Amazing? There is more: advisors and wealth managers have also financial planning and investment proposals tools. They can manage their customers’ investments in all the process.

“We have a long experience in technology and finance with very important players in the sector. We are the answer to professionals’ demands for good tools with a reasonable price. We contribute to improve the sector competitiveness and to open the market for new players. Think about a new advisor or a little advising company. T-Advisor is for them, but also for bigger players who opt for saving costs”, explains Bolívar in his office in Madrid.

Bolívar mentions that the professional package is free for a month with all the features, so that everyone can be sure what is paying for. “We are really sure that the professionals who try it will stay long with us”. So confident, because he knows what he has.

Check the professional package in the T-Advisor website.

Advisors and technology, the next alliance

Advisors ideas. Picture from T-Advisor

Advisory industry faces the challenge of technological evolution. Currently, customers are connected to Internet, they look for news in well-known media, comment articles from experts and (why not?) discuss the decisions of their advisors, because the follow the market.

Are advisors a kind of old-fashioned job or to be extinguished? Absolutely not. But the profession has to take into account some changes to deal with. First of all, advisors have to be on the social networks. Do you know that the use of social media increases with wealth? People are demanding not only for information, but also for a more often personal contact through the networks or communication software (think about Skype, for instance), not limited by a certain appointment in the office. If you are on, you are in.

But the biggest challenge is how to deal with online advice. The industry expects that this will be an important trend, as the biggest competitors will come from this side. That is a logical perception, taking into account that brokers expect to see mobile trading’s share rise to 21% in 2016. Particulars, common people, will have available powerful tools to manage their investments on their own, but advisors will learn to get technology as an ally, because software for advisors will be more useful and adapted to customers’ needs and expectations.

After this description, will the customer forget the advisor as a needed expert to choose the best for his or her money? No. Customers will take surely more decisions on their own, but they will always need an expert in a world with difficult products, as the finance world is. Recently, James Pershing, partner in SunGuard Consulting Services, said in an article (subscription required) that the point to be successful in the advisory industry is communication. How? Speaking the same language. And again, how? Easy, having the same screens, the same information, the same charts, the same figures, and helping your customer with your deep knowledge to get the best choices and obtain the highest performance.

Tools as T-Advisor has this focus: it does not intend to eliminate the advisor, but reinforce his or her job through versions for common people and professionals, so that all speak the same language: an efficient wealth management.

Our General Manager Jaime Bolívar talks about T-Advisor

T-Advisor, the advance wealth management software launched last year for personal investments, is a milestone in this kind of developments. T-Advisor General Manager Jaime Bolívar explains some details about the suite.

Question: Mr. Bolívar, you are also Techrules General Manager, a leading company that offers software solutions for the financial sector. T-Advisor is focused mainly in individuals. Why did you take this decision?

Answer: Techrules has more than 20 years of experience developing the best solutions for financial entities with a high success. Nowadays individuals have many channels to manage and decide about their investments, because they have a lot of information available through the Internet. But a lot of information does not mean being well informed. That was our point: organise and provide highly accurate and visual information, so that everyone could take the best decisions for their investments.

Q: There were already tools to manage own investments. What are the strengths that any investor can find in T-Advisor?

A: T-Advisor was conceived for individuals that even do not have deep knowledge in markets. That is why the suite is very visual and has many ratios to follow the performance and the risks of their investments. We are very proud about our tools of market opportunities, updated every week; our smart benchmarking tool, to help investors compare relative performances in their portfolios; and our quant model portfolios, defined by profiles and countries, so that a particular can join them. These quant model portfolios designed by T-Advisor are performing incredibly well: the weakest, for a conservative profile, produced a 5.3% return and the strongest climbed to a 69%, linked to the Nasdaq. And we are continuously improving, updating and creating new tools in the suite.

Q: What about investment information from different countries? Is that possible?

A: Of course, that is another of our strengths. You can find market opportunities in 29 different exchanges, from Europe to USA and emerging markets. Our watchlists provide assets from a wide range of indexes and institutional investors. And also our global trend tool shows performances in 32 different countries around the world. A particular investor can decide investments from his or her mobile in South Africa, China or US, if he or she checks in T-Advisor that the best opportunities are there. And they can do it through T-Advisor.

Q: Is it difficult access to T-Advisor?

A: Absolutely not. Just register in our website www.mytadvisor.com and begin to invest. Our customers can open a free trial account for three months. We are so sure about the quality of our suite that we know that, after this period, they will not be able to avoid investing with T-Advisor.