Gabriella Iannetta reports in Financial Planning:
58% of an adviser's work can be digitized and done by computers. Machine learning and predictive analytics (make) advisers more efficient. AI can scan market data, understand events that change the market and potential performance of sectors and stocks. Salesforce's Einstein can analyze client sentiment based on data profiling and content analysis to allow advisers to scan across a client's wealth holdings, "giv(ing) advisers a snapshot of a client's entire wealth ecosystem to uncover new opportunities."
The new buzzword in digital wealth management is artificial intelligence, and there's no shortage of providers offering tools they claim can use data to help predict client behavior.
It's a piece of the continued creep of AI into financial advice — a recent study by Bloomberg determined that 58% of an adviser's work can now be digitized and done by computers.
CRM giant Salesforce is the latest entrant into this arena, dubbing its new cloud-based predictive analytics tool "Einstein" — even paying for the right to use the famous physicist's name in some marketing one-upmanship: IBM's similarly AI-powered adviser service is called Watson.
Like IBM's Watson, Salesforce says its Einstein can analyze client sentiment based on data profiling and content analysis to provide insight. The suite of tools combines with aggregation to allow advisers to scan across a client's wealth holdings.
The new tool "gives advisers a snapshot of a client's entire wealth ecosystem, and empowers them to uncover new opportunities that exist within their client's extended household or relationship groups," says Rohit Mahna, general manager of financial services at Salesforce.
Salesforce says the tools are available for no additional charge to its Financial Services Cloud users, and Einstein costs $50 per user, per month, for Enterprise subscribers.
If Einstein doesn't carry appeal, you could always take the red pill and join "Neo."
That's the name financial services consultancy Synechron chose for its matrix of 14 financial management tools, from robos to chatbots, all powered by proprietary AI as well.
An adviser using the Neo-powered suite of tools could ask how a stock is being discussed on social media, for instance, says David Horton, Synechron’s head of innovation.
“Rather than taking your advice from tradition ratings agencies, we can use real-time sentiment analysis about a particular stock, and gauge whether the sentiment is negative or positive,” Horton said. “Chatbot [one of Neo's applications] aggregates and gives a score. You're getting a real-time feel of the particular stock and that is much more valuable to someone about to make an investment.”
Skeptical about such crowd-sourced data analysis? It's actually becoming more common, says Oliver Bussmann, former CIO of UBS and founder of an eponymous advisory firm.
"With AI you can scan the available market data and understand events and triggers that change the market situation and potential performance of certain sectors and certain stocks," Bussmann says. "It's all about the ability to process a huge amount of data, define the rules and drive the right rules."
Like other digital wealth management tools, the machine learning and predictive analytics applications are being pitched to advisers as a means to become more efficient at their jobs.
Though there are limitations. Horton, who is also Synechron’s lead on its robo adviser application, says automated advice hasn't entirely shifted the wealth management industry like he thought it would.
“There is still a need for that human interaction," he says.