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7 Ways AI Can Help Advisors With Wealth Management

As AI becomes more prevalent in the actionable intelligence that drives growth. 6. Better intelligence on different
financial industry, adopting its tools and At TIFIN, we’re deploying some of investment types: machine learning algo-
technologies will give financial advisors these models with larger rIAs and wealth rithms can be trained on historical market
a competitive edge. Here are seven key enterprises to help uncover such insights data and/or proprietary investment data to
areas that affect AI’s ability to enhance as: Which of your prospects most closely predict future price movements, responses
the wealth management industry: resemble your best clients? Are any of to macroeconomic trends and more. One of
1. data driving a revolution: In the world your clients holding a significant portion the most powerful AI aspects is its ability to
of wealth management, data strategy has of their wealth elsewhere that you may answer basic questions by using predictive
been a part of most firms for the past be able to consolidate? Are there oppor- learning from complex data sets to return
decade. From investing in cloud platforms, tunities for your highest-value clients to easy-to-understand answers that may not
custodial integrations, customer relation- generate referrals from within their per- be apparent to human analysts, leading to
ship management systems and other soft- sonal or professional networks? more informed investment decisions.
ware-as-a-service solutions, the amount of 4. new revenue channels for advisors This can prove invaluable when applied
proprietary wealth management data has and wealth enterprise firms: AI is not a to areas like alternative investments or
never been greater. This will accelerate the back-office technology but can be applied other investment types that advisors or
production of wealth-specific AI solutions, to the challenges facing a chief growth their teams may not have expertise in.
allowing models to be trained in shorter officer. The right model framework can As a result, AI creates organic growth
time frames and generate more accurate be designed to support growth-focused opportunities and helps minimize the
and personalized results. activities such as lead generation and need to hire full-time employees with
2. new models proving to be a game marketing automation by better scoring dedicated areas of expertise.
changer:. Since late 2022, large language leads, prioritizing prospect lists and find- 7. enhancing compliance and next-
models have risen to prominence, with AI ing referral opportunities. This, of course, best-action for portfolios: AI can assess
offerings like chatGPT and bard garnering helps to alleviate some of the burden felt and quantify risks associated with dif-
millions of users. For wealth management by advisors. What’s more, AI can identify ferent investment types, helping inves-
firms, this translates to a lower barrier to lead opportunities in parallel businesses tors make informed choices that align
entry for the development of solutions. such as insurance and plan sponsorships with their risk tolerance. It can account
Whether it’s through AI-centric wealth- to generate efficient, low-cost intercompa- for macroeconomic factors, geopoliti-
tech vendors bringing innovative products ny lead flows for larger wealth enterprises. cal events and market sentiment when
to market, or in-house developers build- 5. Growing real-world client relation- assessing potential risks. It can continu-
ing solutions for specific firm needs, the ships: AI can serve as a co-pilot to the mod- ously rebalance portfolios to maintain
accessibility and potential applications of ern wealth manager looking to deliver more alignment with investment goals. And
AI are more widespread than ever. personalized advice based on an individual’s finally, AI can assist in ensuring compli-
3. More than just chatbots: When we financial situation, goals and risk tolerance. ance with financial regulations by monitor-
talk about AI, chat assistants often steal It has the ability to synthesize data from ing and reporting on investment activities.
the headlines. However, the use of “preci- multiple inputs and provide both household- It should be the goal of all wealth man-
sion AI” in wealth management can deliv- specific insights and next-best-action rec- agers to look well-informed about their
er stronger results for advisors, specifi- ommendations for advisors to execute as clients’ portfolios. AI represents the most
cally by using supervised learning models they look to better serve their clients. powerful innovation in the industry’s his-
to solve specific business needs. When Think of it as having a client service tory for helping advisors save time, bet-
you start with the outcome in mind and intern who is on top of your crm, client ter educate themselves and, ultimately,
use the latest models to tap into propri- books and records 24/7, standing ready create better wealth outcomes for their
etary firm data, you’re able to mine this to provide actionable intelligence at a clients. —vinay nair, Ph.d., founder and
data for correlations and extract valuable, moment’s notice. Ceo of tIFIn Wealth
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December 2023 Investment AdvIsor 1