San Francisco, CA, , April 22, 2002 - A recent study of advisor loyalty and service needs among high-net-worth investors conducted by Spectrem Group found that 41 percent of investors with more than $500,000 in investable assets would either move assets or directly pay a fee in order to receive web-based consolidated wealth management services from their financial advisor. Spectrem Group, a consulting firm specializing in the affluent and retirement markets, estimates that there are 1.7 million high net worth investors that are willing to move 48 percent of their professionally managed assets, valued at $550 billion, in order to receive such services.
The Spectrem study was conducted in April 2002 on behalf of Advent Software, Inc.® (Nasdaq: ADVS) a premier provider of software, data and services for the professional financial services industry. Spectrem will be presenting its research at the Advent Software “Solutions 2002” Conference this week in San Francisco, one of the investment industry’s premier forums.
“This research shows that there is a large opportunity for today’s professional investment managers to provide online wealth consolidation to a largely under-served group of high-net-worth investors. We expect that the demand for such a service is likely to continue increasing as the more technologically savvy baby boomer generation benefits from generational wealth transfer,” said Linda J. Jacobsen, Director at Spectrem Group.
“A major reason for this interest is the increase in complexity that has resulted from greater access to a broader array of standard and alternative investment vehicles,” continued Jacobsen. The study found that high-net-worth investors have an average of 12 investment accounts and three checking and savings accounts. This complexity increases for ultra high-net-worth investors, with more than $5 million in investable assets, who have an average of 17 investment accounts. “We’ve found that high-net-worth investors most value the services a financial advisor could deliver based on an understanding of their total wealth – not just the assets that advisor may manage – such as risk management and after-tax performance optimization,” said Jacobsen.
“In addition to desiring professional advice on their consolidated wealth, high-net-worth investors are increasingly interested in online financial tools and resources to help them stay personally informed. These investors frequently visit public financial websites such as MSN and CNBC to get market information, and numerous bank and brokerage firm websites to do account management,” said Jacobsen from Spectrem Group. Spectrem’s 2001 Affluent Market Research Program estimated that over 80 percent of high-net-worth individuals currently have Internet access. Spectrem’s April 2002 research found that 86 percent of high-net-worth individuals aged 60 and under that have Internet access use the Internet for financial activities, such as gathering market information and account management. Jacobsen adds, “We expect that both percentages of high-net-worth investors online and their usage of the Internet for investment purposes will continue to increase.”
According to the study, high-net-worth investors showed a very strong interest in an online wealth consolidation service that could give them visibility into their overall wealth and access to comprehensive research, news and information. Seventy-two percent of investors aged 60 or under, and 53 percent over age 61 were interested in getting access to such a service.
“We feel that these findings represent an opportunity for investment advisors to strengthen existing client relationships by enhancing their level of service, and also to attract new clients who are looking for these types of services” said Jacobsen.
“Advent’s wealth management strategy through Advent TrustedNetwork™, WealthLine and our recent acquisition of Kinexus has been based on a fundamental assumption that high-net-worth investors would move assets to an advisor offering online wealth consolidation,” said Brian Bailard, Vice President, Wealth Management Solutions for Advent. “We are pleased to see further confirmation of our strategy.”
About Spectrem Group
Spectrem Group (www.spectrem.com) is an innovative consulting firm specializing in the affluent and retirement markets. Spectrem integrates fact-based information with expertise in building business, marketing and M&A strategies for clients. The company understands clients' business challenges firsthand because its professionals have held senior management positions at leading global companies. Through a collaborative process, Spectrem creates and implements practical and profitable strategies that fit the cultures of its clients' firms. For more information, please contact Linda Jacobsen at 212.243.2984 or firstname.lastname@example.org.
Advent Software, Inc. has been providing trusted solutions to the world’s leading professional money managers since 1983. Firms in 45 countries use Advent technology to manage investments totaling more than US $8 trillion. Advent’s quality software, data, services and tools enable managers to improve service and communication to their clients, allowing them to grow their business while controlling costs. Advent’s common stock is traded on the NASDAQ National Market under the symbol ADVS. For more information please visit www.advent.com.
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