Wealth Management EDGE: A Deep Dive into AI, Investing, and UHNW Strategies
The Wealth Management EDGE conference brought together industry leaders to discuss the latest trends and innovations in wealth management, with a particular focus on artificial intelligence (AI), investing strategies, and ultra-high-net-worth (UHNW) clients. Here's a deep dive into some of the key insights and discussions that emerged from the event.
AI: More Solutions Than Problems
Mazi Bahadori, CCO and executive vice president of operations at Altruist, argued that there are more AI solutions in wealth management than there are problems. He noted that almost every company raising venture capital funding has an AI mandate, and these companies are raising "stupid sums of money" to build things that will become commoditized and that you can build yourself using tools like Claude. Bahadori warned that advisors are constantly getting sold on stuff that doesn't really add much value, and the best way to address this is to identify what problem you're trying to solve in your advisory business.
The AI Pyramid: Where Are You?
Andres Garcia-Amaya, CEO and founder of Zoe Financial, wants firms to ask themselves where they are "on the AI pyramid." He identified four stages: search and discovery (the base of the pyramid), building repeatable skills (the middle), and agentic (the tip of the pyramid). Garcia-Amaya stressed that there's only one way to reach the tip of the pyramid: by building skills and tasks that can attract clients and automate common tasks within the organization.
UHNW-Focused Advisors See a Fundamental Shift in Client Expectations
Heather Pelant, a managing director and wealth advisor at Cresset, said the wealth management industry is grappling with whether, and to what extent, advice is broadening beyond investment management and financial planning. She argued that this change is being driven by three key areas: the increased complexity of portfolios and investment products, shifting client expectations toward broader life advice and guidance, and the impact of technology for both advisors and clients. Pelant believes that the goals are not necessarily about maximizing return, but also about having a hand in "what does multigenerational stewardship look like, how does capital align to what is of most importance to me and my family? What does governance look like?" She doesn't think this will happen in five years, but rather "now."
Engaging with Next-Gen Clients
RIA leaders speaking on a panel at the UHNW Summit said there is a pressing need for financial advisors to engage with their clients' second-generation family members, rather than just pay lip service to the idea. Cameron Rogers, partner at Angeles Wealth Management, said advisors can benefit by engaging clients' second-generation family members early, as families are getting more complex in their makeup, and issues of inheritance and support may veer more toward "therapy." Tiffany Tocco, business development risk advisor at Starkweather & Shepley Insurance, recommended that advisors stop using complex investment terms and acronyms with younger generations and instead "educate the next generation in terms they can understand and relate to."
Small Firms Needn't Be Left Behind in AI Race
Adam Moseley, Charles Schwab's director of artificial intelligence consulting, argued that small firms may have a tactical advantage as they "have far less red tape to work through." Mark Swan, CEO and co-founder of Nevis, predicted that the industry is shifting from systems to agents, meaning AI tools will no longer be considered a supplement to advisor tasks and will move further toward completing tasks "end-to-end." Allworth Financial Chief Marketing Officer Brad Boekestein noted that during that firm's recent recapitalization, AI was the top focus, and potential investors wanted to know whether AI would make firms' current models more efficient or change them "altogether."
Focus on the 'Trust Stack,' Not the Tech Stack
During a panel session, executives discussed how behavioral finance technology can be used to better connect with clients. Dr. Joshua Wilson, founder of NeuBeFi, argued that advisors should focus on "the trust stack" rather than the "technology stack." Eric Franklin, managing principal and owner of Prospero Wealth, agreed, saying he wants to put himself in front of the client and not have his interactions feel automated. Franklin uses AI tools to get a quick understanding and context before a client meeting, allowing him to focus on personal stories, connection, and education.
More than Direct Indexing
Kacie Jason, regional director and vice president at Dimensional Fund Advisors, discussed the adoption of long-short SMAs, which she sees as evidence that advisors want more out of their vehicles than what direct indexing is doing. She hopes the asset management industry will move away from focusing on marketing standards-alone tax-efficient products and start coming up with ways to make those various products work together for the clients' benefit.
AI Experts Question Need for Data Lakes
John O'Connell, the founder and CEO of The Oasis Group, warned attendees about trying to "boil the ocean" by asking agentic tools too much. He stressed the importance of locating a real ROI for the use case and connecting downstream to a critical core party system to run workflows. O'Connell also noted that firms with under $5 billion to $7 billion in assets under management shouldn't take on the expense of creating a data lake, as it requires cleaning the data twice and can be costly.
Where to Invest Outside the U.S.
Eric Sterner, CIO at Apollo Wealth Management, and Katherine Bordlemay, managing director, fundamental equities, at Goldman Sachs Asset Management, discussed investments in Japan and Europe as diversifiers for U.S. investors. They noted that while emerging markets offer attractive discounted opportunities in technology and biotech equities, developed markets can be a dividend play that provides downside protection. Bordlemay cited the defense and utilities industries as among the stronger sectors in European markets.
A Commodities Supercycle
Chris Coolidge, CIO at Brookwood Investment Group, said his firm is considering upping its allocation to commodities from 30% to 40%. He attributed this to the market being in the middle of a commodities supercycle, driven by the wars in Ukraine and Iran and the AI boom. Coolidge is particularly bullish on copper, given its necessity for data centers and the length of time it takes to create new supply. He also expects disruptions to fertilizer transport and adverse weather events to drive a surge in agricultural product prices.
Making the Case for Annuities
Orion Williams, managing director at Pacific Life, discussed the perception of risk associated with annuities and how research shows they present the biggest opportunity for RIAs to gather new assets organically. He noted that client complaints related to annuities are minimal compared to the size of the industry, and annuities have characteristics similar to other products already in RIA portfolios, such as bonds and private credit allocations.
Help Clients Borrow Like a Hedge Fund
Tony Yang, co-founder and CEO of SyntheticFi, discussed how he used a box spread instrument to secure a lower interest rate on a mortgage. He decided to create a startup to bring this strategy to advisors, providing software that allows them to use box spread strategies with their clients. Yang said the No. 1 use case they are seeing with advisors is as a replacement for existing SBLOCs with a floating-rate box spread.
What Levers to Pull to Reach the Next $5B
Executives discussed how advisors can build for the next $5 billion in assets. Bret Feldman, director of advisory operations at TradePMR, identified leadership alignment as the biggest lever, while Matt Matrisian, president of Signature Estate & Investment Advisors, emphasized operational leverage and removing bottlenecks. Derrick Kinney, an advisor growth expert at Success for Advisors, said firms need a common enemy they're fighting as a firm, such as helping people avoid losing money.
UHNW Advisors Must Weigh In-House vs. Vendor Multi-Family Office Services
Kevin Corbett, managing director, corporate development at Mariner, discussed the complexities and costs of building in-house teams to serve clients with $20 million or more in assets. Rob Madore, a director at Marshberry focused on the wealth management sector, noted the risks and diminishing returns of providing adjacent services, such as bill pay. Corbett agreed with the risks but emphasized the importance of owning the complexity and the client.
Optimizing Data for Growth and Avoiding 'Analysis Paralysis'
Samuel Diarbakerly, founder and private wealth advisor at Generation Capital Advisors, discussed the importance of being intentional about the data used and avoiding "analysis paralysis." Eric Fitz-Randolph, enterprise account executive at Pontera, emphasized the need for centralizing data to drive business decisions, while Robert O'Boyle, chief revenue officer at PureFacts, noted that most firms aren't connecting data to growth outcomes and need it in a single system.
Making the Case for Annuities (Again)
Elaine Misonzhnik reported on Kacie Jason's discussion of the adoption of long-short SMAs and the hope for the asset management industry to start working together for clients' benefit. She also covered Michael Kosoff's presentation on the "elegant solution" of using crypto for tax-loss harvesting in clients' portfolios.
How to Exist Outside the Noise
Justin Barish, chief marketing officer for Lido Advisors, discussed the importance of cutting through the noise created by AI in the wealth management space. He emphasized the need for his firm to exist outside the digital world through events, awards, gifting, and sponsorships, which have been "unbelievable for conversion." Eden Ovadia, co-founder and CEO of FINNY, added that younger and high-net-worth investors want to feel seen and heard, and firms can use AI to create personal content and develop a niche that puts them directly in front of the clients they're looking for.
AI Assembly Summit: Insights and Takeaways
The AI Assembly Summit focused on the practical applications of AI in wealth management. John O'Connell, the founder and CEO of The Oasis Group, warned about the risks of data lakes and the importance of locating a real ROI for AI use cases. Lauren Manchester, vice president of sales at Ridgeline, compared AI assistants to agents, highlighting the importance of understanding where efficiency and tasks are needed.
Wealth Management EDGE: A Conference of Insights and Actionable Ideas
The Wealth Management EDGE conference was a rich source of insights and actionable ideas for wealth management professionals. From AI strategies to investing, UHNW client management, and data optimization, the event provided a comprehensive overview of the industry's current state and future directions. As the wealth management landscape continues to evolve, these discussions and strategies will be crucial for advisors looking to stay ahead of the curve and provide the best possible service to their clients.
