Investment News - What's the next emerging technology for wealth advisers?


The current and future states of adviser technology were the subjects of two hour-long sessions at the InvestmentNews Technology Think Tank held in September in New York. In each session, participants were asked to identify their firm's top tech-related challenges and opportunities — first tackling those issues they face now and then turning to future concerns.

This InvestmentNews Technology Think Tank roundtable in New York on Sept. 13, began with an adviser taking aim at digital advice providers. The challenge of robo-advisers is a topic that's "completely boring and mundane," said Josh Brown, chief executive at Ritholtz Wealth Management.

The prolific blogger, who writes as The Reformed Broker, said robos are "essentially lifecycle mutual funds that have been disentangled from their wrapper and put into a new user interface."

Mr. Brown said robo-advisers' investment strategy — heavy on equity when the investor is young, with a shift to fixed income as the investor ages — is "nothing new," and if robos "get people who wouldn't otherwise be dollar-cost-averaging into the markets, it's great. But other than that, robos are just a tool that every adviser will have and use."

Perhaps the greatest impact robos have had on traditional providers of advice is that they have brought the "Amazon experience" to brokerage and financial planning, said David Edwards, founder of advisory firm Heron Wealth.

"They allow the investor to open and fund an account in five minutes, not in a few days," he said.

It's the technology-enabled user experience of having easy access when, where and how the client wants that is the hallmark of robos and that traditional advice firms will have to adopt and incorporate, participants said.

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Next participants discussed with their tablemates some of the problems that could be addressed or solved through the use of technology. After the discussions, a representative of each table presented their findings to the group.


Bitcoin may or may not take off as an alternative currency, but the blockchain technology on which it is based is here to stay.

"Everybody has been looking into blockchain technology," said Pershing's Patrick Yip. "It's a huge disruptor for anyone who handles payments in our business, and some people are even wondering about the need for clearing firms if buyers and sellers could just transact and access a safe public ledger that everyone can verify."

Blockchain technology also may affect the industry's intellectual property, said Mr. Metzger of Dynasty, since ideas or content embedded in a blockchain of data become public.

Bitcoin itself, the most visible aspect of the blockchain, and other types of electronic currency, provoked speculation with some advisors taking a contrary position.

"I've told my clients they'd have to fire me if they wanted me to handle bitcoins for them," said David Edwards, founder of Heron Wealth.

Read the full article at Investment News