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Wealth insights: Getting personal in 2022

This is a sponsored article from Refinitiv.

Refinitiv’s 2022 Global Wealth Report reveals key considerations and insights about investor preferences that wealth managers need to be aware of in order to continue adding value.

The financial markets – and the world – have been turned upside down over the last two years. Retail investors at the same time have had to manage the anxiety that comes with uncertainty, a wave of innovation, fascinating new investment vehicles, global macro changes and a volatile equity market.

Refinitiv recently sought to shine a light on key questions facing wealth firms: What investment opportunities do clients want? How do clients want to interact with those opportunities? And why are they investing in the first place? After surveying more than 1,500 investors across 13 countries, Refinitiv found three key areas where wealth firms should be focusing their efforts to deliver value and benefit investors.

Taking an alternative view

For years, Refinitiv has seen investor demand for alternative investments grow as they seek new insights and opportunities to improve their financial wellbeing. Reponses to the 2022 Global Wealth Report show a desire from investors for more information around non-traditional assets, such as ESG, cryptocurrencies, hedge funds, tokenised assets, non-fungible tokens (NFTs) and more.

Leading the way, not surprisingly, is ESG. ESG-linked investments have gained favour, with a growing number of investors seeking to align their personal values with their investment decisions. One of the key factors to increased interest in ESG is understanding. Half of respondents indicated that they are now more willing to consider ESG because they have a better understanding of these investments.

For digital assets and cryptocurrencies, younger investors are driving demand. Just over two-fifths (44%) of millennials believe that cryptocurrencies will have the biggest positive impact on financial markets, followed by 32% for tokenised assets and 23% for NFTs. This highlights how the available universe of investment options continues to grow alongside demand.

Technology to complement the human touch

The wealth industry has witnessed a permanent digital shift, giving rise to self-directed, advisor-led and hybrid investors with varying expectations for digital engagement with their investments. Despite this shift, one thing seems to remain constant: the human touch remains vital.

Digital capabilities – including video calls, chat features, interactive apps and social media presence – are now crucial for successful engagement with investors. Importantly, though, advisors still add value and have an important role to play.

This is clear, with 58% of all advisor-led investors and 62% of all hybrid advisor and self-directed clients highlighting “advisor recommendations” as their most reliable source of investment information. Perhaps surprisingly, even younger respondents are of this view, with 38% of millennials selecting recommendations from their advisor or broker as their chief source of investment ideas.

Even with 46% of investors (and 72% of millennials) accessing account information via a mobile app, providing a personal and human experience through various channels is crucial.

The personal perspective

Personalisation has been an important term in wealth for a while, and with good reason. Today, investors expect tailored experiences, whether through Netflix, Amazon or investing. Ensuring client loyalty through personalisation is crucial.

With 64% of millennials and over half (51%) of investors aged 35-54 willing to pay more for personalised investing products and services, it is vital that wealth firms understand each client’s needs.

This presents a golden opportunity for firms and advisors to leverage technology and data to personalise the client experience and develop long-term, loyal client relationships.

Future focus

Through challenging times, digital transformation and ever evolving investment opportunities, the wealth arena remains dynamic and industry participants should strive to cultivate an agile and forward-thinking approach to changing investor needs.

Those firms that position themselves to offer a broad and inclusive range of investment alternatives, leverage technology to enhance the human touch, and treat each client as an individual, will be best-placed for success.

Access the full report to learn more.

This is a sponsored article from Refinitiv.

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