WealthTechs open up opportunities to increase investment management’s business volume which also benefits their client

WealthTechs open up opportunities to increase investment management’s business volume which also benefits their client

During the last decade, innovative digital investment tools brought greater efficiency, accuracy and objectivity to the financial services sector. Indirectly, those digital tools contributed to increasing the quality and the business volume of the wealth management firms’ which also benefits their clients.

Digital investment tools have become a key trend that has enabled wealth management advisors to enhance their business model, stay competitive, develop ideal investment portfolios, improve customer service, and reach new markets and client segments while improving productivity and profitability.

Interestingly, the increasing prevalence of digital solutions has not only allowed wealth managers and asset management firms to grow their client base and revenues but has also resulted in streamlining costs for investors themselves.

Growing Business Benefits your Clients

When financial services companies grow their business, their investors also benefit in the form of access to more efficient, accessible, and streamlined processes; faster and more precise reports; more efficient portfolios; enhanced performance and an optimized customer experience.

Let’s face it, competing in the increasingly busy financial industry is no longer about branding. Rather, the biggest challenges, today, are much more a function of the overall client experience and the key questions are around how to ensure client engagement.

Indeed, investors are no longer satisfied with the traditional financial advisory services. Because they want far more, asset management firms need to integrate technology directly into their strategic planning. This means adopting the latest tech innovations to dominate the financial sector.

The Right WealthTech can Streamline an Asset Manager’s Job

Given the meteoric rise of digital solutions, it’s become increasingly clear that in order to succeed in the asset management industry and reach a wider audience, financial advisors and private banks must blend digital and human capabilities.

Integrating strategically selected digital wealth management solutions allow financial advisors to tackle their most important challenges and capitalize on their greatest investment opportunities. Let’s look at the WealthTechs’ key advantages.

Reduced Costs for Wealth management Companies

In these times of manpower shortage, the right portfolio management tools can play a major role by facilitating wealth management processes, as well as allow companies to cut costs significantly. While many may decry the increasing prevalence of the WealthTech sector as being a threat to humans in the financial services industry, statistics do not bear this out.

In fact, despite the growing access to affordable and easy-to-use investment and trading tools, the customer experience still reigns supreme, with a majority of investors reporting they still prefer dealing with a human advisor. Given this, the competition in wealth management is not WealthTech companies themselves, but rather in the range types of services offered and the prices charged by competing firms through the adoption of digital technology.

Process Acceleration for a Better Client Experience

The quality of the client experience remains one of the driving forces of an investment company’s success. Beyond your advisor’s friendly manner, professionalism, and track record, clients look for efficiency in this key role.

The right investment platform can help investment services with process automation and integration, in turn delivering a headache-free, seamless client experience. Process acceleration solutions also allow advisors to offer a targeted and personalized approach to each client. It also allows them to engage and communicate more consistently. All those small details add up to an enhanced customer experience and lead to client engagement.

Manage Large Numbers of Data Simultaneously

Financial management firms ensure that their clients receive the most precise data in the timeliest fashion. Digital technology, in the form of portfolio management tools and other innovative tools help advisors access client positions and history with just a few clicks. This not only greatly streamlines investment operations, but also allows for more precision and accuracy, as well as accelerates the speed of transactions.

Objective Process Management

In times of increased market volatility, effective decision-making is critical and must take into account both a client’s predetermined criteria and long-term investment goals regardless of emotion.

Some tools allow advisors to assess potential performance and risk via model investment portfolios based on reliable and relevant data. Those software tools can go a long way to keeping clients’ funds safe, growing constantly, minimizing the income tax burden, facilitating retirement planning, and meeting every client’s unique financial goals.

Better Transparency and Risk Management

Tools that enable wealth managers to effortlessly track portfolio performance and generate customized reports for their clients, put them at a distinct advantage over the competition. The right investment advisory tools also allow advisors to adapt to different regulatory changes by differentiating between time and money weighted return calculation methods, as well as automate the risk rating process for enhanced transparency with their clients.

Security Risks

While it is not a factor that sets firms apart from the competition, the cybersecurity concerns shouldn’t be neglected. It is therefore essential to choose FinTech companies that have reached a high level of cybersecurity maturity in order to address cyber attacks challenges and prevent against the danger it represents. Good digital tools should possess multiple layers of security and high security standards.

The Wealth Management Technology Sector

The Wealth management technology (WealthTech) sector falls under the broader umbrella of the financial technology companies (FinTech) circle, but specifically uses cutting-edge technologies to provide an alternative to traditional wealth management firms and private banks. There is a wide range of tech that offers substantial advantages to address major trends.

Portfolio Management Tools

Portfolio management tools have proven to be a boon for wealth managers and companies, who are choosing to integrate them into their investment operations, to streamline money management processes, boost profits, and improve returns for investors.

Some automated tools have made it so that tasks and processes previously reserved for wealth management professionals are now accessible to individual investors thanks to a range of inexpensive and intuitive digital investing and saving apps.

Automated Rebalancing Tools

An automated portfolio rebalancing tool analyzes the assets under management within portfolios and suggests adjustments in order to comply with the investor’s objectives. Following this evaluation process, the wealth manager analyses those proposed orders and validates or modifies them before submitting them to the stock market.

A good tool must be customizable and allows the advisor to simultaneously rebalance an entire portfolio, multiple accounts, joint-accounts, relationships, sleeves or any kind of items, and be able to focus on specific models, asset classes and subclass level.

Compliance Tools

As compliance becomes increasingly burdensome for advisors, and clients expect more user-friendly interfaces, wealth management firms are increasingly turning to compliance tools. These software solutions allow firms to comply with industry, legal, security, and regulatory requirements and standards and make it easy to continually audit user activity, streamline risk management and implement other required controls.

Some wealth management platforms and rebalancing specialized software offer built-in compliance tools that help to remain compliant throughout the whole process.

Other types of wealth management technology

Social Trading Platforms

Social trading platforms are digital platforms that allow investors to observe the trading behavior of both their peers and expert traders using a Facebook-like interface, allowing them to follow various investment strategies using copy trading or mirror trading.

Social trading platforms are an increasingly popular part of the financial sector that allows traders to learn which strategies work and which do not and gain a better understanding of trading.


Robo-advisors who use algorithms and machine learning to offer investment advice and money management are also spreading throughout the financial sector. The best robo-advisors offer easy account setup, robust goal planning, account services, and portfolio management.

While robo-advisors have rapidly gained popularity, a survey of 1,518 advised investors in the U.S. published by Vanguard in February 2022 found that “more than 90% of human-advised clients say they would not consider switching to digital, [while] 88% of robo-advised clients would consider switching to a human advisor in the future.”


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