Page 36 - Investment Advisor July/August 2023

Broker-Dealer/rIa ConferenCe Beat

end of the ‘planning’ process,” Hagmeyer sors who have an old-school, ingrained taking notice. As Hagmeyer emphasized,
said. “That approach is effective, as far as approach to doing business — but that’s current and emerging technology is able
it goes, but today’s wealth management exactly the point. “Cutting-edge wealth to automate custom transitions for inves-
clients are quickly realizing they can go a advisors are asking these questions and tors and allow for an ongoing pursuit of
lot further — and that they want to work more,” Hagmeyer said. “They are asking, tax-efficient wealth accumulation. “We
with advisors who can facilitate that.” how can I get my entire client base onto view this emerging approach as the ulti-
More sophisticated (and desirable) model portfolios that I can service rapidly mate form of customization for high-net-
clients, the pair said, are already ask- and responsively at scale? How do I enable worth and ultra-high-net-worth clients,”
ing tough questions about how their customization at scale in such a way that I he explained. “Getting this right can spell
wealth advisors are integrating their vari- can build consistency and efficiency into a huge difference for the client and help
ous goals and preferences into a holis- the client service process? These are the to maximize the value of the advisor.”
tic plan that maximizes the likelihood of questions the industry is tackling today.”
success while minimizing tax burdens In closing the presentation, Hagmeyer AI’s HUGe PoTenTIAL
and eliminating unnecessary risk-taking. dug into the linked topics of direct index- The world of wealth management is
This requires wealth advisors to evolve ing and tax-loss harvesting, suggest- undergoing a period of rapid and pro-
in different ways across their found change, according
businesses, Hagmeyer and “Already today but especially in the to Jim Crowley, CEO of
Fleming said, from client near future, the successful wealth BNY Mellon Pershing, and
onboarding to investment as a result, both advisor
management to vendor selec- management firm will be ‘as much firms and service provid-
tion. Across all these areas, ers like Pershing are having
the need for greater personal- a technology business as it is a to adapt — and fast. This
ization cannot be overstated. financial advisory business.’” means carefully but confi-
These factors mean that, dently embracing emerging
already today but especially — Alex Hagmeyer technologies, such as gen-
in the near future, the suc- erative artificial intelligence
cessful wealth management firm will be ing that these are two key areas where and machine learning, and not being
“as much a technology business as it is a wealth advisors “simply cannot afford afraid to question longstanding ways of
financial advisory business,” Hagmeyer to fall behind the curve.” As he spelled doing business simply because change
said. “Where the rubber hits the road out, many clients come to direct indexed feels discomforting and difficult.
is in matching a client’s interrelated, model portfolios from traditional portfo- It also means uncompromisingly con-
evolving goals with their need to take lio-building approaches at their preferred serving those elements of the job that can-
portfolio risk. This is how we address brokerage or active management shop. not and should not change, Crowley says,
specific goals over time in the context of Many want to improve the diversity of particularly the need to establish deep
holistic financial life,” he said. their holdings by getting away from cap- personal connections with clients and to
One specific way in which firms will weighted indexes, or they want to pursue ensure a spirit of trust and collaboration
have to evolve, Fleming and Hagmeyer some other specific goal that they cannot — both between advisors and their clients
said, is by embracing a framework that achieve with mutual funds or ETFs, all and between advisors and their indis-
does not limit advisors to one set of while being thoughtful about the tax con- pensable service provider partners. “The
products or solutions. Access to best-of- sequences of the transition. In the past, demands on the wealth manager coming
breed solutions across many different Hagmeyer explained, getting this client’s from clients and from the marketplace
practice areas will be essential. “Great position unwound and then reinvested have never been bigger,” Crowley sug-
wealth managers know that the pres- in a tax-efficient way was a big logistical gests. “We know that is the case because
ent and future of client service is not challenge. It was feasible on a client-by- the same is true for us at Pershing. We
about pitching products,” Hagmeyer client basis, but creating such transition are being pushed to innovate like never
explained. “It’s about identifying, under- plans at scale was next to impossible for before, and we are rising to the challenge.”
standing and solving specific problems advisory firms lacking access to powerful Crowley emphasized these twin-linked
in a goals-based framework.” computing technology. challenges and opportunities during a
Fleming and Hagmeyer said this kind Today, service providers are filling that keynote address, during which he was
of analysis may seem lofty to some advi- gap, and forward-thinking advisors are joined on stage by Emily Schlosser, chief

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