Top Takeaways from the Wealth Tech Summit

May 20, 2022

Recap: Top Takeaways from the 2022 Wealth Tech Summit

When the Chief Innovation Officer for the US Federal Reserve System tells you to “become besties with your regulator,” you listen - and hopefully, that’s exactly what participants did as the keynote presenter, Sunayna Tuteja, kicked off the 2022 virtual Wealth Tech Summit. She was just one of many fantastic speakers featured throughout the May 17th event.

Our team was extremely pleased to attend, sponsor and speak at this annual conference that brings all types of wealth managers together to talk about tech innovation in the industry. As bronze sponsors, we hosted a contest to win an espresso machine at our Partner Lounge (congratulations to Ben Wilson at PWL Capital who won!). We also had our VP of Solutions Engineering, Sheila Chau, speak on the Emerging Trends in Wealth Management panel. In case you weren’t able to attend this awesome event, we’ve got you covered. Read on to see the top takeaways from this year’s Wealth Tech Summit.

The Top Three Takeaways From Wealth Tech Summit Sessions

Below are the different Wealth Tech Summit sessions presented in order. There were so many amazing insights shared by every speaker that we couldn’t fit them all in, but don’t worry we’ve included the top highlights from each to put your FOMO to rest.

How Next-Generation Tools are Transforming How to Rebalance Portfolios

Presenter Name and Title: Michael Blicker, Business Product Manager at Croesus

In the first session of the day, Croesus showed off their tech for portfolio rebalancing. The top three takeaways from the presentation were:

Leading firms have leveraged a collaborative approach to rebalancing and the rebalancing tool needs to satisfy those various stakeholders (and support multiple approaches).
Croesus’s next-gen rebalancing tools have 4 main components: robust modelling, cash management, compliance dashboard and predefined tasks & workflows.
Croesus highlighted that modern tools should have automated workflows available at all times in order to minimize friction and reduce time.

Wealth Management Insights: Opening Digital Doors to Personalized Advice and Engagement

Presenter Name and Title: Howard Atkinson, President and CEO at Pascal WealthTech

Pascal WealthTech took the stage with a data-driven presentation featuring behavioural analytics. The top three takeaways from the presentation were:

Financial advisors must quickly adopt a digital strategy to capture their clients. Retention is a key issue going forward, as data shows that 42% of investors are looking to find shift service providers over the next 2 years.
Millennials are not mystical creatures that advisors need to capture. The demographic data doesn’t work, as UHNW boomers and millennials largely have the same digital channel preferences.
Atkinson also pointed out that digital engagement is a top trend, stating that “wealth management firms expect 75% of their client engagement to be digital.” What is more, the presenter also shed light on how the relationship between financial advisors and investors is changing, as value propositions shift towards broader financial wellness and even non-financial advice. They also outlined the importance of loyalty programs, engagement nurturing and creating value.

Developing Your Brand and Improving Your Digital Footprint: Exploring One Advisor’s Journey to Success

Presenter Name and Title: Anna Hilberry, Wealth Management Advisor & Portfolio Manager at National Bank Financial Wealth Management

In perhaps the most uplifting presentation of the day, this speaker focused on how wealth managers can get their brand out there. The top three takeaways from the presentation were:

It’s so important to make a positive first impression, which happens in a mere 7 seconds! While first impressions are sticky and hard to change, they present opportunities because you can completely control them.
Advisors should put the “people” element first by establishing a “YOU Brand,” meaning you are the product, the core and the beginning value. “Don’t be afraid to let your personality shine” Hilberry says. If you show your authenticity in a respectful manner, it can help you build trust, not only with existing clients but also with potential prospects who see your activity.
A great piece of advice: JUST DO IT! If you’re feeling overwhelmed or don’t know where to start, be like Nike and just do it. Break it down to smaller goals that are more achievable, and then tackle one goal at a time!

Practice Management: Automating Workflow to Maximize Your Operational Efficiency [Panel]

Moderator: Phillip Ackers, Founder at Lakeshore Performance Limited

Presenter Names and Titles:
Grant Hicks, President at Advisor Practice Management
Jeff Thorsteinson, Head of Practice Management at Agora Dealer Services Corp.
Jason Pereira, Partner & Senior Financial Consultant at Woodgate Financial Inc.

This was a lively discussion with healthy debate amongst passionate presenters about all things operational efficiency. One point that was hashed out was the limits of scalability, and whether an advisor can effectively service a 200-person book of business with technology, or not. Other key takeaways from the presentation included:

Advisors are facing challenges when making effort to embrace new technology, including getting overwhelmed by too many options. Similarly, advisors can struggle to fully figure out the steps to implement the new digital tools and embrace a culture of workflow technology.
The best use case for technological intervention is always with high-volume, low-value tasks. Technology can help wealth managers save time doing things they don’t like doing so they can spend more time doing the tasks they prefer. However, Jason Pereira pointed out that the cost of technology implementation is important and advisors have to ask themselves: how much time are these tasks going to take me to do myself, and is it worth it to pay for technology to take over?
Top advisors tend to use tech to enhance engagement and client service. They focus on scale and practice value. They work on their businesses, learn, figure out gaps, and improve practices.

Cybersecurity and Essential Systems to Protect Your Clients’ Data [Panel]

Moderator: Fatima Boolani, Co-Head of US Software Equity Research at Citi

Presenter Names and Titles:
John Cossar, Director of Field Technology Services at Manulife Securities
Larry Keating, President at NPC
Ali M.Qureshi, Chief Revenue Officer & Co-Founder at Side Drawer

This was an expert panel looking at the importance of security, which is a core focus across the wealth management sector. The top three takeaways from the presentation were:

Having the right security standards and platforms for small businesses is a key concern. These problems have been in big enterprises and have shifted to smaller businesses. Smaller firms shouldn’t try to solve their own security problems. It doesn’t fall on advisors’ expertise to solve these types of problems and can create risk. Bring in a professional to identify what the key vulnerabilities are.
Awareness and education are most important. Business emails are the number one way that advisors are compromised today. Financial advisors need to educate and create awareness in the office. Many free tools available on governmental sites can help close the gap.
Turn the cybersecurity challenges into a business advantage. Look for a provider with a SOC-2 audit. This is a trust business, and the SOC-2 audit says “we’ve gone an extra step to protect your data.”

The Bigger Picture: Comprehensive Planning for Clients Up & Down the Wealth Complexity Curve

Presenter Name and Title: James Fraser, Co-Founder at Planworth

This was a one-man presentation focused on how to approach planning within the complexities of wealth management today. The top three takeaways from the presentation were:

The shift from investment returns to a trusted advisor is here to stay, and this trend is accelerating.
Existing approaches to becoming a trusted advisor aren't working as only 7% of investors receive all elements of comprehensive advice. Planning has to move from retirement projections to guide every aspect of a client’s wealth.
Companies should help advisors leverage technology to strengthen relationships and generate more revenue.

Panel: Emerging Trends in Wealth Management: Examining the Next-Generation Asset Classes Enabled by Tech

Moderator: James Burton, Managing Editor at Wealth Professional

Presenter Names and Titles:
Sheila Chau, VP of Solutions Engineering at Mako Fintech
James Rockwood, Founder & CEO of CapIntel
Gary Teelucksingh, CEO of Capco Canada
Kaitlin Thompson, Vice President of Product Strategy at Evolve ETFs

As new asset products emerge it’s important that advisors remember suitability. Advisors need to be prepared to discuss new products head-on. At the same time, they should also spend time trying to understand why a client is asking to purchase a certain product and get to know them better.
According to Sheila, asking why an investor should work with an advisor when there are DIY services available, is like asking “Why would kids need parents if they can learn from the internet?” - there’s so much information out there that investors need someone to guide them and support decisions about where to invest.
With innovation and new products, comes the need for regulation. Because new KYP and suitability understanding create additional risk for advisors, it is crucial for advisors to get it right. As firms seek more efficiency and attempt digital transformation, technology selection becomes fundamental to a firm’s success, and can actually create an opportunity for risk reduction alongside new regulation.

Leveraging Social Media in Your Practice to Increase Your Reach to Ideal Clients

Presenter Name and Title: Jacqueline Porter, CFP at Carte Wealth Management

The pandemic changed the way that wealth managers and other industries do business - including marketing strategies. A lot of businesses formerly relied on leads through referrals, networking, in-person events and more. They had to find new online ways to connect with each other, and because people had a lot more time on their hands at home to interact with online material, online was and still is working. The presenter said she used to post three times per week, and since the pandemic hit she started posting daily.
Firms should define where their audience is online and know that the answer includes social media in some form. As a matter of fact, “79% of educated and self-employed Canadians are on LinkedIn, with more and more signing up every day.” Don’t spend time managing a social channel that your audience isn’t on because it’s a lot of work.
Firms who are trying to get more engagement should go like and engage with their client’s pet photos! She recommends that when thinking about social media marketing, wealth managers should have a social media policy and be highly aware of it, do a brand assessment, leverage the law of social media attraction, and find ways to spend more time online with their ideal clients

That’s a Wrap!

From crypto to marketing techniques, the 2022 Wealth Tech Summit was definitely action-packed! If you weren’t able to attend or catch every session, we hope this little recap brought you up to speed. Thank you to Wealth Professional for throwing another great event, we can’t wait to come back next year.

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So in my view an appropriately diversified portfolio should have enough exposure to different asset classes, that its able to withstand a wide range of market disruptions. Usually, it’s some kind of negative or positive event… they’ll affect different asset classes differently. So by having your eggs in different baskets you’ll be well insulated from major risk. For example, there’s some kind of change in the housing market… both by having some exposure to it, you won’t miss out on the opportunity to make money. But if it’s something negative, you’re also not going to lose all your money if all of it were in the housing market for example. So at a high level, a properly diversified portfolio should grow in a growing market and yet not be at risk of major losses in a declining market.
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You asked also about an efficiently diversified portfolio, and I would say that that’s a portfolio that achieves those goals with a minimum of different positions. There’s a lot of good reasons to have fewer positions in your portfolio. Being less complex means a portfolio is easier to rebalance and administer. Every time part of your portfolio goes up or down, you're going to need to rebalance it a little to make sure that it stays with the right allocations and the fewer positions you have, the easier it is to do that..the less trading fees you incur doing that.
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There is a tradeoff between being completely diversified and being efficiently diversified. If you were completely diversified then you’d have a proportional segment of absolutely everything you could invest in under the sun, like shares of palm oil futures or something like that. I don’t think everyone should have palm oil futures in their portfolio but I’m not a wealth manager. I think it comes down to your portfolio and how large it is (probably the Canada Pension Plan has a proportion of palm oil futures in it). You’re going to have to talk to your advisor and choose a degree of complexity that’s right for your portfolio.
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CN: Let’s just take a step back - what does a typical portfolio look like and has that changed over time?
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RB: Yeah, so I'm not entirely sure what a typical portfolio looks like these days because it's actually changed quite a lot over time. I think common wisdom used to be that the classic balanced portfolio was 60% public stocks and 40% bonds. These days that's ancient history. Most would say that the bond allocation should be a lot lower these days in this age of unprecedented low-interest rates. These days it’s the stock portfolio that’s been driving a lot of the growth. I think a well-diversified portfolio in the modern era should absolutely include exposure to all kinds of alternative assets (that aren't even really that alternative but still kind of fall out of that traditional bucket). So you know I mentioned real estate, private companies, maybe for example commodities or other types of investments. So I think that there are a lot of things that you can invest in and your advisor can guide you on what’s appropriate for you.
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CN: Yeah that makes a lot of sense. Talking about alternative investments, we’ve heard a lot this year about ESGs, impact investing, alternative investments… do you think there’s more of an appetite today for these types of investments than in the last ten years?
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RB: Yeah that’s a topic that’s close to my heart having previously started an impact investment company. It’s definitely been a gigantic increase in interest. I think when I started my previous company we were speaking to large wealth managers and having them say “we’re barely getting a grip on early ideas.” Like not including gun manufacturers or tobacco companies, and now these same companies are launching impact portfolios and marketing this aggressively. So there’s definitely been a seat change, it’s a real industry, and there’s a lot of studies out there and data showing that ESG or impact investing can equal or outperform non-impact investments. So I think it’s a huge part of the market these days. That said, one of the things that’s driving it is people’s interest in it. I think that one of the stories of the investment industry has been the personalization of it. People’s portfolios are being tailored to their own needs and circumstances. Impact investing is definitely a piece of that. People are environmentalists, but an institution is not an environmentalist. It doesn’t live and breathe the impact on the environment the way an individual does. The person who is active in the David Suzuki Foundation for example is going to be active as an impact investor and it’s appropriate for them to be.

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That’s a great question. I think there's a lot of advantages and you gain a lot with an automated platform. For me, it's a lot easier to manage. I have some of my money in one of these platforms and I barely think about it. It's being rebalanced all the time. The costs are much lower in terms of expense ratio for the same kind of rebalancing. Again you're missing a lot with that, but on just the mechanical portfolio rebalancing you're getting a great deal there. I would say that two other advantages are up-to-the-minute reporting, so you always have that login where you can see your position, see how your portfolio is doing historically. And finally, this is an advantage for me and anyone who doesn't love doing taxes, but typically they’ll take care of your tax forms for you, and end up with much simpler tax forms, so it kind of works out what your cost basis was and how much you have to report.
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CN: So let's talk about the other side of the coin then...what are the risks of not having a seasoned professional managing your money?
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RB: I wouldn’t exactly phrase the question that way. You know it's more what’s the benefits of having a real wealth manager? Some of the clients of robo advisory firms may not even be aware that they're missing out. A wealth manager isn't just balancing your stocks and bonds, that's kind of the very lowest mechanical level of what you get out of the wealth manager. Really they're your advisor on your life. Intimately intertwined with you because you're thinking about retirement planning, on planning for college for your kids, when is the right time to buy a house, and when should you get life insurance, for example. An advisor can help you with all of those decisions and they can connect you with service providers like a mortgage broker when you may be in need of one. So I think that you get a lot of value out of having one of these advisers, particularly when you get to a stage in life when these kinds of services are more about the long-term and your life circumstances are far more critical.
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CN: There are clearly pros and cons and two sides of the story depending on who you're asking. Like you said, what stage of their life they’re in ...but do you think the platforms that we’re seeing emerging like to Qtrade, Wealthsimple, and all the rest will ever become status quo?
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RB: Yeah, I do actually. I think that similarly to how you know we’re using online platforms to automate everything for us (I can’t think of the last time I used to travel for example), everything you’re going to be trying to do with your money is going to be automated, and it’s going to be appropriate to be handled by one of these one of these platforms. In particular, for most people at an early stage in their lives that have few assets to manage, not a lot of complexity, not a very extended personal family circumstance, it’s gonna make a lot of sense to have a low fee robo worry about it. But at some point their life circumstances are going to get more complex and you’re gonna get married, or maybe you’re not, or you may have other objectives that you may want some advice on and at that point it may make sense to either supplement the robo advisory portion of your portfolio, or graduate to a more holistic wealth management view.
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CN: Thank you so much Raph, these answers were great. It’s always insightful chatting with you so thanks for sharing those answers with us today.
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RB: It’s my pleasure.

Author: Chandal Nolasco da Silva

Chandal is Mako's VP of Marketing & Communications. She is a dedicated leader who has spent a decade creating recognized B2B SaaS content marketing and SEO campaigns.

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