- The wealth management industry is showing signs of opening up to digitization with the advent of robo-advisors.
- The US is the home market of low-cost robo-advice, as self-directed investors are driven by price sensitivity.
Ken Research has announced its latest publication on, ‘Robo-Advisors: Mapping the Competitive Landscape”, which aims at clarifying the differences between various automated investment platforms. The publication includes case studies of the leading robo-advisors to offer insights on what are the features which attract the customers and the reason behind the change. Drawing from the inferences of Verdict Financial’s Global Wealth Managers Survey, the report examines the attitudes of HNW individuals digitized advice. In addition, activities of the software vendors w.r.t. the robo-advisors market are also included the in the publication.
The battle between man and machine has reached a new level and entered into the wealth management dimension. Robo-advisors are built on the premise that the functions performed by a human Registered Investment Advisor (RIA) can now be replicated by advanced software based on artificial intelligence. The USP of Robo-advisors include lower costs, ease-of-use and even the promise of making financial investment a “fun” activity.
The wealth management industry has already opened towards the process of digitization and investors have begun to put their confidence into non-human artificially intelligent software. Additionally, competition within the automated wealth management space is expected to get fierce for robo-advisors as the traditional wealth managers are also moving into the digital space supported by abundant availability of software developers. Overall, it can be said that the future outlook for robo-advisors is positive but they will have choose more appealing business models which will appeal with HNW individuals.
Trends Governing the Future of Robo-Advisors Globally
The advent of robo-advisors has disrupted the financial advisory industry in a very short span of time. Even though the future of the industry is still unsure, it can be said with confidence that the market and demand for robo-advisors will expand rapidly.
Some of the trends governing the industry of robo-advisors globally are:
- There is a shift towards acquisition. Leading financial conglomerates have not only developed their own platforms, but are also aggressively acquiring already existing successful platforms. This helps them in enhancing their own products and services along with reducing competition.
- The fittest will survive. There will be increased competition in the future and only those robo-advisors will survive who will have the right business model in place. Small players will have to come with unique value propositions so that they can compete with leading financial conglomerates.
- There will be new markets opportunities opening up. Apart from robo-advisors being used as wealth managers, they will also have new opportunities in the retirement plan market and regulatory market.
- In addition, banks might also open new partnership opportunities for robo-advisors. In fact, banks and robo-advisors might turn out to be ideal partners as bank would able to add new valuable services to the banks services such as investments.
- Greater diversification and expansion. The robo-advisors are constantly being upgraded and modified to serve the ever-growing needs and markets.
Key Topics Covered in the Report:
- Detailed overview of the robo-advisors market worldwide
- Definitions and related concept of the global robo-advisors market
- Evolution of the robo-advisors market globally
- Region wise data regarding robo-advisors adoption
- Factors driving robo-advisors adoption globally
- Differences between mature and emerging markets
- The impact of EMV migration on robo-advisors
- Competitive landscape of the robo-advisors industry globally
- Strategic considerations and foresights regarding the robo-advisors industry’s future.
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Ankur Gupta, Head Marketing & Communications