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Technology > Artificial Intelligence

Investors Believe AI Will Help Advisors Better Serve Clients: Study

By Michael S. Fischer

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Seventy-two percent of investors in a new survey from Morgan Stanley Wealth Management believe that artificial intelligence is a turning point for themselves and for traders, and 74% expect it to help financial advisors better serve their clients.

Sixty-three percent of survey participants said they would be interested in working with an advisory firm that leverages AI. However, 82% also said AI will never replace human guidance, and 88% agreed that the human-to-human financial advisor relationship is extremely important.

Younger investors are especially enthusiastic about AI’s potential, the survey found. Eighty-seven percent of respondents in the 35-to-44 age group viewed AI as revolutionary, 89% said it would help improve advisors’ client service and 85% expressed interest in working with an advisor who leverages it.

However, younger investors’ strong belief that AI will not replace the advisor-client relationship is on par with the overall sample.

Dynata fielded and administered the online survey in April among a sample of 924 U.S. investors.

Early Adoption Amid Dissent

AI is still gaining traction, and it is not without detractors. A majority of financial services executives in a separate study said AI has already changed the way they work, and they expect more change as AI’s capabilities expand. One wealth management tech provider recently rolled out ChatGPT-embedded software to advisors on its platform.

Morgan Stanley, for its part, was one of a small handful of companies receiving early access to GPT-4. It is developing a service leveraging OpenAI tech to deliver content and insights to its advisors.

But an economist warns that ChatGPT could spell “disaster” for financial advisors. And major banks are cracking down on its use.

“While AI is clearly groundbreaking, and we are just scratching the surface of its potential impact within financial services, this data aligns with an insight we’ve known for some time: The clients who are most engaged with their financial advisors are also the most satisfied,” Jeff McMillan, MSWM’s head of analytics, data and innovation, said in a statement.

“Within this context, AI should be viewed not as a replacement of human guidance, but as a powerful tool to help turbocharge a financial advisor’s practice management and client interaction capabilities.”

In recent comments, Morningstar chief executive Kunal Kapoor also suggested that AI could be revolutionary. He noted that investors, especially those who have not worked with an advisor, have trouble seeing the value in financial advice, and that AI should put advisors “in a position to provide a much better investing experience and do that at scale.”

(Image: Adobe Stock)

Michael S. Fischer

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