It is important for the panellists to act as a partner for your customers. Partner that contributes the experience of their teams, creating opportunities for their partners to discuss for decision making. Also of importance is the democratization of investment alternatives, making accessible to all investors those strategies used by large institutional investors. For them, blockchain it will allow a less pro-cyclical system, and it will generate changes in the asset management industry, which will be very different from what we now know. Impact investing is a trend that will come to the fore, as it is today, but where it will not be “passive” but with total “engagement”. There are opportunities on the part of the outsourcing professional asset management services, mainly institutional and corporate, for what is needed tell with infrastructures technological that give agility.
For Jenny johnson, the complexity of the asset management business and the regulation around it is such that many clients often show a preference for working with large entities, with greater capacities both in investment teams that allow the client to carry out more comprehensive operations or the “One-stop-shop”. For Jenny, the growth cycles of those companies that wait longer to go public are captured by qualified investors, but mutual funds in this industry contribute to the democratization of access to certain markets. The “tokenization” that comes from the blockchain will unlock and help clients reach private issues in a profitable way.
In some management companies, a change in the “chip” is observed, acting as the client’s “strategic partner” when it comes to investment solutions, and that many management companies, including Spanish ones, have coined that phrase. But you have to go further, he says so Michelle Seitz who commented that it is necessary to try to put on the table everything that the client may need to manage his portfolio and the risks that he could face. Furthermore, “we are trying to democratize access to these institutional capacities that the most sophisticated clients in the world take advantage of and we take them to the intermediate market ”. Only 25% of the institutional market they are targeting outsources management capabilities, making the untapped potential huge for Russell Investments.
This directive considers that the business model will also have to evolve as fast as product innovation, taking into account flexibility and agility for customize to scale for the end customer at lower prices.
Instead, Dawn Fitzpatrick, who spent the initial 25 years of his career in the management part, recognizes that the definition of the products for their construction is somewhat strict and therefore not well built. He emphasizes that the important thing in this industry is to be super agile, so it is important to know where things can be done in this industry in an agile way and to have the ability to buy assets when there are forced sellers, as happened last year with the crisis of the Covid-19, and then be agile with the great value / growth rotation, “agility creates opportunities”.
Regarding industry consolidation and margin compression, Suni harford comments that subcontracting or outsourcing is increasing. More and more clients are subcontracting, so “it is necessary to have invested in this technology to ensure that we are agile and we can take advantage of all the changes that are taking place on the client side. One of the big trends is the outsourcing to professional managers”. This directive also refers to impact investing, which is a very present trend that will come to the fore and will be very specific, with returns not only financial but impactful in all senses.
Between the challenges that they commented is about the downward evolution of commissions, but in turn a more complex regulatory environment, which in turn makes management more expensive. For this the investment In the business it is indispensable, such as data analysis, machine learning, artificial intelligence – which not only applies to investment capabilities but also to the customization that is provided to the client. In general, to technological disruption with FinTech in the spotlight, not only for today’s business but where the industry will be.
And the opportunities that they glimpse is in the sense of the personalization investment solutions and wealth / financial planning for the affluent sector and not so much for those of high net worth, taking advantage of technology to offer those capabilities at scale.
The pandemic has made clear the need to adopt greater technologies and flexible work structures, as well as the adaptability of the industry to the needs of each moment of the client.