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Author: Elliot Parfitt

Published date: 2017/02

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I recently published an article (“The Future of Investment”) in which I examined the potential future providers of investment / asset management services and what the next generation of investors are likely to be looking for. To follow on from this, I thought it might be useful to analyse this area from a technology perspective – what will be required at the customer point of sale and how is this tech area likely to develop over time?

There doesn’t seem to be an area of consumerism at the moment without technology at the forefront from retail, music & TV, social interaction etc and there isn’t much reason to assume that the investment industry will be any different.

As we have seen recently (e.g. Facebook’s mammoth purchase of WhatsApp for $19Bn) seemingly simple technology can be given an extraordinary value provided it allows the purchaser access to vast quantities of client data – ostensibly so that further products can be ‘target marketed’. As mentioned in “The Future of Investment” there is a real opportunity for large corporate clients to break into the investment industry given that the likes of Apple, Amazon and Google already hold enormous amounts of client data – the key to their failure or success however is likely to be the technology used to deliver the investment services of the future.

It goes without saying that technology will be web-based and likely mobile so the question is really: “What do people want?” and I would suggest that Apps may have the edge over more traditional log-in websites in this area.

Provided that confidence could be built around security, an App from an Investment Manager (either currently existing or one of the future) that offers full visibility of an investor’s portfolio is likely to be attractive. Similar to the hugely successful Apps for spread betting and sports betting, investment management delivery will need to include extensive choice, the ability to fully analyse potential investments and flexibility of user profiles & configuration settings. In addition to this, there is a real feeling that simple is better, I don’t believe that the next generation of investors are going to want anything like the level of detailed information that has been traditionally expected of an investment manager. More important will be the level of reliability and speed. In the world of instant action, any mobile-provided service will need to be backed up by networks & infrastructure that allow users to access & interact the service easily and rapidly – especially dealing with scenarios where lack of access will affect users profit.

Interoperability between financial services is also being spoken about so it would seem that links between banking, social accounts and investment services will serve the dual purpose of providing users easy access as well as giving providers the opportunity to sign their customers up to multiple product offerings.

In short, the future of the investment services industry is likely to see a technological convergence with other areas of the consumer market which in turn will have an impact on the area of the industry which is actually producing & supplying the technology. Cross-format Applications and those that can incorporate a variety of offerings will be the winners provided that they can supply fast, secure and informative investment options for the next generation of investors.


In our most recent Trading Technologist, we discussed the future of asset management and investment with a particular focus around the providers of the future.

As someone rapidly approaching my 4th decade, I am a part of a generation that remembers the pre-internet days and as such have witnessed the explosion of the last 10 years of web-based retail, banking and service provision.

You may be asking yourself how this is will affect the investment industry and there is a reasonable case to suggest the answer is ‘significantly’.

Professionals who are now moving to a stage in their life where they begin to consider investing money have grown up in a world where access is king and brand familiarity breeds continued custom. The younger generation expect to be able to utilise services around the clock with a swathe of peer-reviewed products and in-depth access to information. There is certainly the potential for a new breed of investment providers to succeed over the established players in much the same way that the ubiquitous Amazon has triumphed over the high street – and if current press is to be believed, it won’t be all that difficult.

By understanding what will attract the new generation of investors, any number of organisations will be able to profit in this market, potentially including already known brands that are able to diversify. A future of Tesco Wealth Management, Google Investment Services, and Amazon Asset Management is not difficult to imagine.

Of course this is not to say that there isn’t room for existing heavyweights to continue succeeding however, the consensus is that they will need to be attractive in different ways.

For example, a large part of the appeal of asset management / investment management firms historically has been the prestige of their brand (many being established from family businesses run over many decades if not centuries) and a certain level of exclusivity. In addition to this, information is generally difficult to access and ‘membership’ comes at a high price of entry. While this will continue to attract a certain part of the market, there is a real opportunity to bring in a much wider audience by providing an investment model that fits with the expectations of the next wave of investors and to a certain degree this can be done by replicating the model of the successful internet retail / banking giants:



Services have to be at the very least web-based and ideally mobile friendly. The rigmarole of periodic, paper statements simply will not be attractive.

Low cost of entry:

By removing some of the overheads associated with traditional investment firms, new players will be able to offer investment services at a lower cost, removing the intimidation factor that has kept a certain part of the market away.


Simple, understandable information on both services offered and performance of investments is going to be key.

Reward & Integration:

Online accounts that can interact with Amazon, Google etc and offer incentives for use of one provider or another. The current trend of amalgamating services means that an organisation offering your banking, retail or internet provision could be perfectly placed to add additional services.

Peer Review:

With almost no effort whatsoever, it is increasingly possible to build a profile of review from users of almost every service, product and offering – while I would always advocate taking internet reviews with a pinch of salt, this could be a hugely effective tool for future investment providers.

Given the length of operation of most of the larger asset management / investment management firms, it is reasonable to assume that they certainly have a place in the future of this industry but the general feeling is that the model can be adapted and as is usually the case, some existing players will hold fast to their old methods and will fail, some will adapt and continue their success and new parts of the market will be captured by entirely new providers who are able to offer a services truly aligned to the demands & expectations of an information hungry, internet savvy customer base.

As always, we welcome your thoughts & feedback – if you are involved in the asset management industry, have an investment portfolio and would like to see a different offering or even if you are entirely happy with the way things are please don’t hesitate to get in touch.