2024: Trends to Watch in Wealth Management Summary This report informs wealth managers and their strategy teams of the key developments emerging across the industry and how best to respond to these changes. The report examines in detail key areas such as the crypto hype, HNW asset allocation strategies, profitability, and ESG, with analysis supported by findings from GlobalData’s propriety surveys of wealth managers and investors. 2024 promises to be another challenging year. Economic growth remains slow, geopolitical tensions are mounting, and inflation remains stubbornly high in key markets. However, there are pockets of growth. For example, India provides a significant opportunity with above-average wealth growth. Yet as more firms are looking to capitalize on strong growth, competition is heating up. In the wider wealth space, we are seeing more investments in generative AI to keep costs at bay and assist with productivity. On the client front, we see ongoing demand for personalized products, which will contribute to further growth in the direct indexing space. Demand for tokenized assets is also on the rise, which will drive the adoption of alternatives in lower wealth bands. And last but not least, cryptocurrencies are still a major theme in 2024. However, wealth managers will do well to discuss risk, as the bull will run out of breath eventually. Scope - ESG remains the top issue for wealth managers, but transition investing, while still in its infancy, is forecast to grow significantly too. - A desire for personalized products will support demand for direct indexing. - Demand for tokenized assets will grow, and providing access is a must. - Crypto funds are all the hype, but concerns regarding the longevity of the bull run are surfacing. Reasons to Buy - Understand the key trends impacting the wealth management industry in 2024 and how to respond. - Learn about the possible use cases for AI and understand how the technology will affect the wealth management industry. - Understand the different investment trends from cryptocurrencies to ESG and how they will impact client demand. - Analyze how changing competitive dynamics will affect your business.
- Macroeconomic and Wealth Market Outlook
- Inflation is easing but will continue to affect investment strategies
- Recessionary pressures have eased, supporting an uptick in wealth growth
- Growth is forecast to slow down, but we expect a calm 2024 after years of havoc
- Wealth growth tracks along but does not impress as economic recovery remains slow
- Wealth managers who have focused on their Asia-Pacific strategy will be rewarded as the region maintains momentum
- Strong wealth growth in India will see more international players enter the market
- Rise of the Expat
- Sharply higher expat and migrant populations
- Top sources of immigrants
- Generative AI
- AI will help advisors to achieve major productivity gains
- The legislation landscape governing AI remains murky at best
- We expect strong demand for AI-qualified staff
- Gen AI is transforming financial advice, from onboarding to marketing and investment recommendations
- Cryptocurrencies
- The crypto winter is over, and Bitcoin is back on the agenda
- The SEC's approval of the first US-listed Bitcoin ETF was a major confidence boost
- Crypto is more than an investment and will increasingly be used as a payment tool
- Other Investment Trends
- Demand for tokenized assets will rise, opening up a wider target market for wealth managers
- Demand for direct indexing will grow as more Gen Zs are entering the investment market
- ESG has become commonplace in the HNW space
- Transition investing is growing as ESG has become commonplace
- Increased Consolidation
- Consolidation is expected to pick up as wealth managers are looking to bring expertise in-house
- UBS's Credit Suisse acquisition: HNW wealth and relationship managers are looking for new homes
- UBS's goal to achieve $5 trillion in client assets is ambitious but achievable
- Profitability is increasing as competition is on the rise
- Channel Preferences
- Establishing the main provider relationship is critical in the promiscuous HNW space
- HNW investors are adopting a more hands-on approach using digital and face-to-face
- Key Takeouts
- Appendix
- Methodology
- Secondary Sources
- Further Reading
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