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Industry Spotlight > Women in Wealth

Technology and Wealth: The New Wealth Manager

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When Charles Schwab introduced the retail version of its robo-advice offering in early March, Executive Vice President Naureen Hassan said the company had received 28,000 inquiries on the offering, Schwab Intelligent Portfolios, since it was announced last fall.

Of those inquiries, Hassan said only half were from existing Schwab customers of any kind; of that group, 50% reported having more than $250,000 in assets. “This is not just for younger people getting started,” Hassan said during an online press conference, but instead “Schwab Intelligent Portfolios is for a wide range of investors—including those who’ve accumulated some wealth” and who are attracted by a digital advice offering that is “easier, more accessible and more transparent, with an established company.” So for advisors, Hassan said in an interview, “half of those calls are prospects.”

In a March 2015 study on robo-advisors, “Digital Wealth Management Market Update: A Mosaic of Models Emerges,” research firm Aite Group argued that as “ traditional firms roll out digital wealth management capabilities, this new segment of the wealth management market will complement the traditional world. Firms will adopt digital technology in different ways, and many types of digital wealth management business models will coexist.”

The first robo-advisor entrants, Aite pointed out, “are delivering on two needs” for which traditional advisory firms “had struggled to provide: digital client-facing tools, and affordable fiduciary investment management and financial planning.”

Aite also argued persuasively that the digital advice providers are so far striving to segment their clients as well, and concluded that “the entrenched view that these digital advisors are only for millennials is no longer accurate. Similarly, stereotyping these models as for mass-affluent and mass-market investors is false,” the firm pointed out. For example, “Wealthfront is currently grappling with how to onboard millionaires tax efficiently.”


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