Advisor | December 2023
Financial advisory expresses its added value when it includes a periodic monitoring of investment portfolios, an ongoing assessment of their adequacy in relation to the clients’ risk profiles, interaction with clients on the basis of the aforementioned profiles, the explanation of the reasons behind the investment advice provided and a possible revision of the portfolios.
This service, known as advanced advisory, has become the new mantra of financial networks and private banks.
In some cases, advanced advisory becomes even more advanced and incorporates other pillars of asset management such as insurance, credit, illiquid assets and, especially, real estate.
Advanced advisory is, in truth, an old concept, at least as old as the profession of financial advisor, which today finds expression in state-of-the-art platforms made available by banks and financial networks.
Indeed, advanced advisory is not exclusive to financial networks anymore; rather, it is offered by banks, which provide personalized advisory in several fields, namely investments, welfare, real estate, insurance, and inheritance.
Sometimes, advanced advisory takes the form of a paid adjustable offer: in this case, clients can add one or more optional components to the main component.
The added value of advanced advisory and the ability to make clients appreciate it are the strengths of this service. In this sense, payment becomes a proof of its value.
Moreover, advanced advisory represents such a large universe that it may incorporate administered savings including the beloved BTPs – i.e. long-term treasury bonds – which, in this case, are one of the ingredients of a composite e varied menu.
An analysis of the assets managed through advanced advisory highlights an increase by 25% over the past three years, a sign that the market trusts advanced advisory and that clients appreciate it.
Of course, advanced advisory has to be explained and enhanced in the eyes of the clients who are not satisfied with merely delegating the management of their wealth, but wish to contribute proactively in order to increase it, defining strategies together with their financial advisor, participating in strategic and tactical decision making to plan their investments in an optimal manner in the realm of the overall management of their wealth.
The level of satisfaction with advanced advisory expressed by asset management professionals in Italy, that is bank employees dedicated to the affluent segment, financial advisors, and private bankers, tends to vary.
Financial advisors tend to share a higher level of satisfaction: for them, advanced advisory is no news; on the other hand, its recent declination in platforms accessible to all clients represents a novelty.
The level of satisfaction of private bankers employed by large private banks has increased compared to last year thanks to new innovations, new contents and the relation between costs and benefits for clients.
On the other hand, bank managers tend to be rather tepid: they struggle to make their clients, who are on average less wealthy, appreciate advanced advisory.
However, the die is cast, and soon advanced advisory will be within everyone’s reach.
Nicola Ronchetti