Wealth firms still slow to take up robo & digital offerings in Asia
Mathias Helleu of 8 Securities
May 8, 2018
Mathias Helleu, Executive Chairman, 8 Securities, tells Hubbis why the engagement of robo-advisory and digital wealth solutions has been slower in Asia.
“It’s uncomfortable,” he says. “It forces you to reimagine your business model. It challenges every aspect of the business. It challenges your cost base.”
For firms that own a kind of monopoly on the wealth management business, Helleu opines that there is absolutely no reason to change except for pressure from customers and clients. “The pressure can come from customers get more educated, understanding what’s at stake,” he says. “The trend is inevitable.”
Helleu gives an example of how not too long ago when a Hong Kong investor wanted to trade a US stock, firms were charging USD100 each way. “Today, we offer it for free,” he states, talking of Tradedflix, the firm’s zero-dollar commission trading app for Hong Kong investors.
Helleu says that he understands that there is a lot at stake for the industry’s old guard. “Robo-investing piece is a much bigger piece of the puzzle for banks and financial institutions,” he says. “That is still a very juicy business where commissions are very high.”
“The banks [thus] don’t have a lot of incentive to adopt those products quickly, but I would say the wave is inevitable,” he explains, “when the product from the customer point of view is so much better than whatever is offered today.”
He points out that digital wealth solutions are easy to understand, the commissions are a fraction of what is charged to the Hong Kong customer currently, and the flexibility is immense. “You’re not locked in for a month, a year, or 30 years,” he explains. “You can get in and out of the product at any time at no cost, you can own a diversified portfolio with as little as USD100, and you have access to the best ETFs.”
“This is pretty unique, and so it’s not a matter of will it happen in Hong Kong, but rather when,” Helleu says.
Executive Chairman at 8 Securities
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