As a research-driven organization, Optima Group closely monitors events that are expected to have a material impact on the financial services sector. Needless to say, we are carefully watching trends that might emerge from the current situation. We are focusing special attention on several key questions, the answers to which may portend consequential future developments in the industry. These questions include:
1. How have investment managers responded to a new normal of financial market volatility and what will be the intermediate and long-term effect of these decisions on their businesses?
2. What share of managers across HNW and institutional markets rebalanced according to pre-bear market strategic allocations and what share have reacted with significant tactical shifts?
3. Did industry standard asset allocation strategies suffer from insufficient risk management in black swan events, and will this lead to new approaches that achieve more effective diversification?
4. Will new approaches to risk management catalyze a round of creative product development in alternative asset classes or accelerate the expanding use of alternatives and alternative platforms among RIAs and OCIOs
5. How will wealth management and institutional clients react to the current reliance on and benefits of innovative forms of communication — and will increased familiarity with these forms of interaction accelerate the trend towards the digital client experience?
6. What market share changes will we see among robo-advisors serving individual as well as institutional clients over the next year?
7. Will behavioral and political consequences of the crisis drive interest in and use of ESG strategies by individual and institutional investors?
8. What impact will the down markets have on the broader competitive environment in wealth and asset management and how will it affect firm valuations and M&A activity generally?
There’s no doubt that the financial services industry will change. As it does, we are committed to keeping pace with these changes as we determine the effective strategies to manage the future challenges our clients face.
Stay safe and healthy,
Director of Research