11 Oct 2019Mark Shields

What makes an effective digital wealth management solution?

Digital wealth solutions have become a priority for financial firms catering to tech savvy investors. Read on to find out what features such solutions need.

As wealth starts to transfer to and accumulate in the hands of the technologically adept Millennials and Gen Z, these younger investors often tend to look for digital wealth management solutions.  

In fact, analysts presently estimate that more than $2 trillion in assets will be under management by such programs by 2020. Digital wealth management software has therefore become an increasing necessity for banks and other financial institutions looking to service the investment needs of such tech savvy retail investors.

What investors look for in digital wealth management

Wealth management solutions that allow a retail or mass affluent investor to analyse investments, invest in them and then manage assets in their investment accounts -  without the need for extensive communication with human financial advisors  - are in increasing demand.

Despite their growing popularity, not every digital wealth management platform, robo-advisor or asset management system is going to be suitable for every investor, nor is every perceived client need or preference going to be met.

This is in part due to the fact that the demand from investors for wealth management tools still remains a fairly low — but rapidly rising — component of the overall demand for financial advisory services, so wealth management software providers have yet to react to fill all possible needs.

That is changing quickly though: research shows that roughly 66% of millennial investors now wish to make self-directed investments, despite the fact that they also want to retain access to a human financial advisor for some purposes.

Common Characteristics of effective digital wealth management solutions

While not every wealth management solution will have the same characteristics, some popular features of a digital asset management solutions can include the following:

  • Easy to learn: Since clients,  and sometimes the advisors themselves, do not have the time to familiarize themselves with all the portfolio theory and functionality, it helps to reduce the initial learning curve and increase the uptake rate if people find the solution straightforward to use and pick up.
  • Fast and efficient operation: Companies can use the software to increase productivity if the software is ergonomic and easy to operate.  Similarly the investors expect real-time analytics - waiting for re-balancing responses that last more then a few seconds is not acceptable.
  • Provides goal-based client advice: Advisory solutions should focus on client’s investment objectives and preferences - and so provide advice that is meaningful and tailored to them.
  • Cost effective to maintain and operate: Such solutions have to be able to scale rapidly, without the need to duplicate technology or the need to cope with sudden escalations of costs.
  • Make use of Big Data analytics: It should have the ability to interrogate and analyse the full universe of investment data and client history - as well as other open data sources - to ensure intelligence decisions can be made, beyond the obvious and standard.    
  • Provide Open APIs to integrate to other digital solutions:  To play a role in investors daily lives, digital wealth solutions have to integrate with other commonly used apps and provide a fully joined-up digital experience.  
  • Act as an aids to advisors: An intelligent advisory and asset management solution should help human advisors provide faster, better and more consistent investment advice - and gain new business - and not just provide an alternative, stand-alone, advice channel.  
  • Enhances compliance as regulations tighten: As new financial regulations approach, wealth management solutions need to anticipate and adjust to the new requirements on a continual basis.


Providing good wealth management software remains one of the main priorities of forward thinking financial institutions. Those looking to provide such solutions to clients range from well-established banks and wealth management firms to standalone digital wealth management and robo-advisor providers still in the start-up phase.  

An excellent way to keep abreast of current trends in the wealth management industry and get new ideas to remain competitive involves reading surveys of industry executives. This survey was recently compiled by Orbium, and it highlights the main pitfalls and favourable prospects noted by wealth management executives. Furthermore, the survey shares their strategies for operating productively within a changing business milieu. In addition the recent paper form Celent sheds a light on leading wealth management solutions.

Written by Mark Shields
Mark has over 20 year's of experience working with financial technology across the banking, asset management and capital market sectors. He regular writes content for Avaloq's global community of banks and wealth managers, covering technology trends and innovations, to provide insight and provoke new ideas.

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Learn about:

  • Key success factors
  • Trends and areas of development across the European wealth management vendor landscape
  • Avaloq's position in Celent's ABCD Vendor View