Markets continue to fluctuate. Technology continues
to disrupt. The ambitions you have for your wealth
never waver, but your wealth management needs
change with the dynamic world we live in.
The CFA Institute has prepared Charterholders to measure up to your wealth management needs. The CFA Institute surveyed 900 investors with at least $1 million in investable assets to figure out how CFA Charterholders can help you harness your wealth to pursue the ambitions that drive you forward.
Our most valuable asset is time. Many people are
experts in something, but no one has the time to be
an expert in everything. Given the incredible depth
and breadth of knowledge required to build expertise
in wealth management, it's no surprise that survey
respondents list investment expertise as the most
important trait they seek in a wealth manager.
High-net-worth investors face unique wealth management challenges, from nuanced tax planning and strategy to safeguarding the interests of future generations. With the right private wealth manager, wealthy investors know there can be simple, elegant solutions to even the most complex wealth management challenges. It takes an adviser with the right expertise and savviness to turn that financial complexity into clarity.
Experience and savvy in investments
Access/knowledge to a variety of products
Good listening skills/ability to understand my needs
Staying current on new strategies/anticipating future developments
Responsiveness when issues emerge
Proactivity in making suggestions and asking questions
Patience in handling questions
Effectiveness in teaching me what I need to know
Flexibility to work in a system that works for me
A holistic approach to wealth management
Strong written/oral communication skills
Creative thinker that can come up with novel approaches
No two people are the same. We all have different ambitions,
goals, and dreams, so each investor has different wealth
management demands — and a private wealth manager
must be equipped with the skillset to meet them. High-net-worth investors expect holistic wealth management
service; this is particularly true for younger high-net-worth
investors (age 25-39), who are over twice as likely as their
older counterparts to seek a holistic approach to wealth
But, "holistic" doesn't mean "generalist": the unique complexities of wealthy individuals often require bringing in the right specialists at the right time, and a sophisticated wealth manager ought to reflect these specialist views as they create and execute a robust investment strategy. No matter how complex the portfolio or nuanced the investment strategy, these investors demand that their wealth managers measure up to the ambitions they have for their wealth.
From cryptocurrencies to Silicon Valley's newest venture
capital darling, new types of investment opportunities
are everywhere. Though these newer investment vehicles
are bold and buzzworthy, the CFA Institute survey reveals
high-net-worth investors aren't yet sold, with the majority
of respondents leaving cryptocurrencies completely out
of future asset allocation plans. Rather, traditional assets
remain the bedrock of the high-net-worth portfolio:
a plurality (23%) still plan to invest more in stocks over
the next five years, reflecting continued faith in public
equities as a foundation of portfolios, particularly among
investors age 25-49. Investors over age 50 were even
more sour about the idea of putting money into
unconventional vehicles in the next five years.
The story is the same for Environmental, Social, and Governance (ESG) investment vehicles. Despite the increasing popularity of incorporating ESG factors into investment analysis, such factors are not a "top priority" for high-net-worth investors, with only 11% of wealthy investors listing it as such.
Diversification across asset classes
Diversification across industries
Investing in instruments that are transparent/understandable
Achievement of funding for specific goals
Diversification across factors
Diversification across countries
Important in Asset levels above $10M
Socially responsible investing
"Passion" investing (e.g. cars, art, wine, antiques)
Important in Asset levels above $10M
For all the buzz about robo-advisers, high-net-worth
investors don't want to lose their human advisers.
Three quarters of high-net-worth investors surveyed
said they prefer working with a human adviser for at
least some of their wealth management services.
Rather than a replacement to human advisers, investors instead see technology as an enhancement to existing wealth management efforts. Interestingly, investors with $10 million in investable assets indicate particular interest in integrating technology compared to the rest of their high-net-worth counterparts.
A third of those investors prefer their adviser to integrate technology into their service, citing a desire to use technology to keep up with their wealth manager about their positions and performance. Younger investors (age 25-39) indicate an interest in "what if" analyses of their holdings and track progress towards their financial goals; they're twice as likely as older investors to demonstrate interest in this technology.
What are your primary goals as you look to maintain and/or build your wealth?
One size definitely doesn't fit all. It's essential that your
wealth manager have the breadth and depth of skills
to align with your specific life goals and objectives,
whatever they may be. Initial exploratory conversations
with wealth managers should involve matching your
goals against their capabilities.
You've worked hard to grow your wealth. Make sure you're
working with a wealth manager who grows with you.
Armed with a deep foundation of knowledge about capital markets, investing, and wealth management from mastery of the CFA curriculum, CFA charterholders are ready to unlock wealth management opportunities that others might miss. By virtue of completing the CFA Program, CFA charterholders have already proven they can succeed where few do. They stand ready to apply that same commitment towards your goals.