Date
22 July 2017
Investment services are now becoming more tailored to specific needs of individual customers, taking into account factors such as their stage of life and lifestyle. Photo: Wisegeek.com
Investment services are now becoming more tailored to specific needs of individual customers, taking into account factors such as their stage of life and lifestyle. Photo: Wisegeek.com

Money managers shift focus from products to client needs

Whether professionals in the finance industry like it or not, financial technology is transforming the business in every way.

It has become increasing difficult to make money based on customers’ transaction volume because the business has become so transparent and transactions costs have been coming down fast.

The change has prompted more companies to adopt a management fee or performance fee model instead.

That in a way explains why more financial institutions are applying for the Securities and Futures Commission’s Type 9 license for asset management these days, instead of the once popular Type 1 license for securities dealing.

Also, instead of being product-driven, investment services are now becoming more centered on specific needs of individual customers, taking into account factors like their stage of life and lifestyle.

For example, the old-school suggestion for a 65-year-old client who owns a few million euros would be a very conservative investing strategy.

But if he also happens to have a big family, and travels quite often with his family members, a new-generation money manager will probably recommend a more aggressive investing approach that can generate adequate income to cover such expenses.

Retirement needs, healthcare and wealth allocation preferences are other goals modern-day financial planners need to address.

Such financial planning needs to be reviewed or revised every five years to match the changes in the client’s situation, priorities and targets.

This article appeared in the Hong Kong Economic Journal on Oct. 14.

Translation by Julie Zhu

[Chinese version 中文版]

– Contact us at english@hkej.com

RT/CG

Founder and Managing Director of Pegasus Fund Managers Ltd.

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