Client expectations and preferences are constantly evolving. Firms and advisors who understand and adapt to them will be positioned for success; those who don’t risk falling behind.

But what do clients want? Ian Russell, president and CEO of the Investment Industry Association of Canada (IIAC), helps answer this question in his latest industry letter. He identifies five fundamental trends discussed at the U.S. Securities Industry and Financial Managers Association’s 2016 Private Client Conference held in New York earlier this month.

  1. Investors and clients are placing greater emphasis on an interactive, comprehensive relationship with their financial advisors.
  2. Clients demand financial services customized to their needs, and expect to obtain these services at fair value. At the same time, clients want user-friendly access to technology to monitor their financial statements, communicate with their advisor and execute transactions.
    • With respect to services tailored to client needs, advisors and firms must be sensitive to the growing diversity of clientele. Women represent an important and growing component of the wealth management business. Failure to adapt to this reality will have significant bearing on business success.
  3. The steady shift in investor preference to new types of indexed products, investments for their own portfolios and within third party wrap accounts—passively managed robo-type portfolios or actively managed portfolios of indexed products.
  4. Brand loyalty is less entrenched and more transient than ever before.
  5. Demand in the U.S. market for greater transparency of products and services, and the related fees and charges.

Russell also notes “Canadian dealers have a competitive advantage over their U.S. counterparts, with full compliance with the CRM rule framework that imposes transparency on the investing process, products, fees and portfolio performance, and strengthens the conflict of interest and suitability obligations of the advisor.”

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