RFS Insightcasts

• Managing Wealth for the Next Generation of Clients

  With the aging of today’s customers and the upcoming transfer of assets, many wealth managers are faced with the challenge of retaining next-generation customers. This next generation has grown up in a completely different context. So the question for wealth managers is what does this generation really want from their advisors, and how should they adapt to this new set of needs and wishes? These are some of the questions that have been answered in our webinar with Viola Werner, Head Global Next Generation and Families at Credit Suisse and CEO of The Family Institute, and Dr. Andreas Zingg, Head of Switzerland and Liechtenstein at Vanguard. Next-generation clients are more tech-savvy and generally more interested in investing than their parent’s generation. They also prefer do-it-yourself services, where the consumer now completes tasks previously delegated to others. The previous generation used to go to travel agencies to book their vacation. The current generation books their vacation themselves. Consequently, next-gen wealth management clients do not want to delegate their money to a wealth manager. They are seeking advisors, not managers, who need to act as coaches and who have to understand the client’s goals. The next-generation wealth manager listens and understands their client and presents the financial tools and strategies to achieve these goals. That explains why, even though these clients appreciate (or even require) tech platforms, the quality of the human interaction remains critical. At the same time, the next generation is price sensitive and has all the tools and information to compare prices of different providers. When a wealth manager charges more, they want to understand what they get in return. But providing high-quality advice is costly. Consequently, the big challenge of future wealth managers is to provide financial “coaching” so that clients can conduct their investments on an advanced tech platform while offering a competitive price. Next-generation clients have a strong demand for educational programs and direct investment opportunities. Viola pointed out the importance of starting the financial education process as soon as possible. Andreas stated that the data shows that younger investors like passive investment solutions such as those offered by Vanguard and are less active traders than older investors. It is thus critical to provide more education because conducting direct investments without the proper education usually leads to bad performance. In terms of product offering, the next generation’s demands investments with a clear impact. This goes beyond sustainability. They are interested in investing directly in promising start-ups and entrepreneurs. Regarding sustainability, they prefer not to invest in unsustainable companies rather than investing in particularly sustainable companies. This would favor basic exclusion strategies and is also why ETFs that exclude non-sustainable sectors are the most in-demand. They do not sacrifice returns or diversification for sustainability. However, research suggests that basic exclusion strategies do not have a tangible impact. An “own and engage” approach is more effective in moving businesses to be more sustainable.

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• Brent Beardsley (Vanguard) about what retail investors want, passive investing and trust

  In this slightly shorter episode, we talk to Brent Beardsley, who leads Vanguard Personal Advisor Business in Europe. The discussion covers asset and wealth management topics and we talk about client needs, the Vanguard Effect, trust and what Vanguard plans to do in the future. Enjoy listening.

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• The Future of Wealth Management Platforms

  Robo-advisors emerged after the 2008 crisis as fintechs aiming to democratize access to wealth management services. But most have failed to build sufficient scale as they struggle with customer adoption. Still, these fintechs have set a new standard for the role technological interfaces can play in the way financial services are structured and consumed. And while the pandemic has accelerated the trend toward technological adoption, it has also highlighted the need for financial management solutions that offer a human touch – a hybrid approach. In this podcast, Bruno Patusi, who is the Lead of the Financial Services Department at EY Switzerland moderates a panel discussion on hybrid advice in Wealth Management with Nicolas de Skowronski, an Executive Board Member at Julius Baer, Michael Stemmle, the Founder and CEO of additiv and Brent Beardsley, who leads Vanguard's Personal Advisor in Europe. If you have any questions, please contact us at [email protected].

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• The rise of retail investors (feat. Morgan Housel)

  Investing has entered the digital age. But this does not only have advantages. The new world of day trading for zero commission offers retail investors new opportunities to access the capital markets at low cost, but the process is also driven by constant notifications, information overload and a frantic pace that invites risky decisions. This dopamine-driven process flies in the face of what professional investors may consider a successful approach: relying on fundamental valuation analysis, independent thought, and longer-term investment horizons. Looking ahead, this bifurcation of investment offerings between traditional investment firms and new low-cost online trading platforms begs the question of which model offers clients the most real value? Our forthcoming Insightcast discusses this and similar topics around customer needs in wealth management with two exciting experts: Dr. Andreas Zingg, Country Manager of Vanguard Switzerland and Morgan Housel, best-selling author of the Psychology of Money.

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• Rising inflation, rising debt, and rising interest rates – a dangerous cocktail for markets?

  Rising inflation, rising debt, and rising interest rates – a dangerous cocktail for markets? Investors are getting nervous. Since the market correction in March 2020, both bond and equity prices have skyrocketed higher on the back of enormous monetary and fiscal stimulus. Now, as inflation expectations continue to edge higher, investors are starting to sell government bonds, sending interest rates up sharply. The 10-year US Treasury yield has already risen to its highest level since the start of the pandemic. And as fiscal spending, debt levels and inflation expectations continue to rise, many investors are getting unsettled. To discuss the implications of these developments, we were thrilled to have three brilliant minds join us on this podcast: - Giles Keating, former Head of Global Research at Credit Suisse and current board member of Bitcoin Suisse - Carl Verbrugge, Partner at Lombard Odier - Guy Spier, best-selling author, prominent value investor and CEO of Aquamarine Capital

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