NEW YORK, NY —September 21, 2016 – Technological, economic, and demographic shifts will transform the wealth management industry by 2021, according to research released today by Roubini ThoughtLab, a thought leadership firm. These shifts will unlock tremendous global wealth, but also raise investor expectations for new advisory and digital solutions that some investment providers are not yet prepared to offer. If their new needs are not met, 48% of investors declared that they will switch providers.
The new report, Wealth and Asset Management 2021, is based on a survey of 2,000 investors and 500 investment providers across 10 major wealth markets, in-depth interviews, and economic modeling led by noted economist Dr. Nouriel Roubini. The study was produced in conjunction with a diverse coalition of sponsors, including Bank of Montreal, Broadridge Financial Solutions, CFA Institute, Cisco, eToro, Schroders, SEI, and State Street.
The changing investor landscape
The Roubini analysis foresees huge wealth creation across changing investor demographics over the next five years:
- Household assets will rise $89 trillion in 25 top markets, with the biggest gains coming from emerging markets, such as China, Mexico, and Poland.
- Millennials, Gen X, women, and emerging market investors will see their wealth climb and their investments grow. Even those with small savings will invest more thanks to greater market access through technology.
The Winners: Large institutions, trusted brands and digital leaders
The research also shows that financial technology will disrupt the industry from within. Unlike other industries, such as retail, which experienced external disruption from digital startups such as Amazon and eBay, fintech solutions will become widely adopted by incumbents with trusted brands.
“The winners in this new playing field will likely be large full-service institutions, mutual funds companies, and trusted names in wealth management,” said Lou Celi, CEO of Roubini ThoughtLab and the Program Director. “These organizations may be better equipped to meet the rising demand for specialized expertise, responsive 24×7 service, and wider investment and financial services.”
“Crucially, the research reveals five key pathways to success used by today’s digital leaders: invest adequately in new technologies (41%), make the customer central (37%), nurture an innovation culture (33%), develop an effective transformation process (32%), and bring the right talent on board (31%).”