Technology Driven Personalization in Financial Advice

ActiveAllocator’s core growth strategy capitalizes on several long-term industry trends that continue to be valid and even stronger in 2020. One being mass-customization. Technology driven mass customization is affecting many customer oriented industries, driving clients to expect highly personalized services uniquely tailored to their specifications. ActiveAllocator allows the “traditional” advisor to provide a modern digital advice experience. Recognizing that the “market of one” is the new norm, we go far beyond broad meaningless categories such as the wide spectrum of “very conservative” to “very aggressive” investors. Rather, our system is designed to drive the individualization of every aspect of asset allocation, down to the level of a single client.

Customers demand personalization without realizing they are demanding it, as they grow accustomed to companies anticipating their needs and offering what they’re looking for – sometimes before they even know what that is. Retailers and travel companies are using predictive tools and algorithms to exceed expectations, yet digital teams at financial firms have been slow to re-engineer websites and apps to enable highly personalized digital experiences. As consumers become more accustomed to personalized services – from online music selection, to customized exercise plans, to personal shopping, to travel – expectations will further rise. Within the financial advice sector, our approach rapidly exposes the fallacy of the “one size fits all” solution approach – such as those embodied in model portfolios and managed accounts.

Personalized service is going to be a key weapon in advisors’ battle, against competition from and disintermediation by, digital advice platforms. Once investors realize that the same managed accounts offered by advisors can be manufactured in minutes by robo-advisors at a fraction of fees, advisor fee compression is but inevitable. In an era when money can be managed effectively, efficiently and cheaply, ActiveAllocator helps advisors move up the value curve. Marrying our cutting edge fact-based, algorithm-driven predictive analytics with the advisor’s special understanding of the client’s unique circumstances drives superior outcomes. We believe that this powerful combination goes far beyond anything offered by emerging digital financial advice platforms, robo advice and digital investment managers.

 

 

Which Asset Class is Now Attractive For You? Which is Not?

The world has changed in 2020 and so should your investment portfolio. But has it?

Given what you/ your client already owns within a portfolio, should  one own more of a particular asset class? Or less? What is attractive and what is not?The most consequential, and often best decisions, are those that are made at the margin. However marginal decomposition, on a forward- not backward -looking basis within portfolios is easier said than done. While there is much written in the academic literature, one is often hard pressed to arrive at fact based decisions at the moment of making investing calls.

In the past such was often relegated to opinion, conjecture and gut feel. Not anymore. ActiveAllocator calculates it for you in 15-20 seconds.

ActiveAllocator Comparison to Addepar

ActiveAllocator is very inspired by Addepar, and the generous analogy investors now draw. At a closed door briefing I was told ‘one day you will exceed Addepar’. For a struggling FinTech CEO this, I thought was the highest compliment! I looked at similarities and differences between our companies ..here

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ActiveAllocator Tech Improvement in 2019

ActiveAllocator is a MIT-Harvard-Technion-Yale -UCDavis alum founded WealthTech startup. We analyze and integrate traditional, illiquid and alternative investments to improve complex portfolios: This actual live screen capture here aggregates customers accounts across +15,000 banks, sources capital market inputs from +10 Wall Street firms, simultaneously analyzes +10 million asset allocations deployed across +4 million securities, within +50 granular asset sub-classes, personalizing target portfolio to +100,000 preferences, whilst executing seamlessly across +20 broker dealer systems. All done in under 2 minutes.