Investment Solutions Forum 2019 HK - Highlights - Harold Kim

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1. What are the challenges and opportunities for this industry?

Video transcript

1. What are the challenges and opportunities for this industry?

First of all, I want to thank Michael and the team at Hubbis for their kind invitation to me to participate in today's conference. This morning, we talked about the challenges and opportunities that technology, both financial and computer, have presented to the wealth management industry. The broad takeaway is, as an investor, now, there are many more opportunities for an investor to express their investment view. Costs are going down, and access to products has grown exponentially. Trends like the rise of ETFs have allowed individual investors to essentially do their wealth management by themselves. On the other hand, advisory providers have been challenged. Costs of stock commissions have gone down, and the difficulty in out-performing passive indexes or robo-advisors has led to a real challenging situation for advisory providers. If you are an active asset manager and you're not doing better than the relevant benchmark, you will lose assets. If you are a private bank that's not providing asset allocation advice that's better than a robo-advisor, you will lose assets to that technology. And so, we'll see how these challenges continue to evolve. Again, we believe that, on balance, the changes are very favorable for investors, but will be a challenge for private banks and active advisors.

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