Wealth MGMT

Wealth management
Wealth management is an investment-

advisory discipline which incorporates
financial planning, investment portfolio
management and a number of aggregated
financial services offered by a complex
mix of asset managers, custodial banks,
retail banks, financial planners and
others. There is no equivalent of a stock
exchange to consolidate the allocation of
investments and promulgate fund pricing
and as such it is considered a fragmented
and decentralised industry.[1] High-net-
worth individuals (HNWIs), small-business
owners and families who desire the
assistance of a credentialed financial
advisory specialist call upon wealth
managers to coordinate retail banking,
estate planning, legal resources, tax
professionals and investment
management. Wealth managers can have
backgrounds as independent Chartered
Financial Consultants, Certified Financial
Planners or Chartered Financial Analysts
(in the United States), Chartered Strategic
Wealth Professionals (in Canada),[2]
Chartered Financial Planners (in the UK),
or any credentialed (such as MBA)
professional money managers who work to
enhance the income, growth and tax-
favored treatment of long-term investors.
Private wealth management

Private wealth management is delivered to
high-net-worth investors. Generally this
includes advice on the use of various
estate planning vehicles, business-
succession or stock-option planning, and
the occasional use of hedging derivatives
for large blocks of stock.
Traditionally, the wealthiest retail clients

of investment firms demanded a greater
level of service, product offering and
sales personnel than that received by
average clients. With an increase in the
number of affluent investors in recent
years,[3] there has been an increasing
demand for sophisticated financial
solutions and expertise throughout the
world.
The CFA Institute curriculum on private-

wealth management indicates that two
primary factors distinguish the issues
facing individual investors from those
facing institutions:
1. Time horizons differ. Individuals face a
finite life as compared to the
theoretically/potentially infinite life of
institutions. This fact requires strategies
for transferring assets at the end of an
individual's life. These transfers are
subject to laws and regulations that vary
by locality and therefore the strategies
available to address this situation vary.
This is commonly known as accumulation
and decumulation.
2. Individuals are more likely to face a
variety of taxes on investment returns that
vary by locality. Portfolio investment
techniques that provide individuals with
after tax returns that meet their
objectives must address such taxes.
The term "wealth management" occurs at

least as early as 1933.[4] It came into more
general use in the elite retail (or "Private
Client") divisions of firms such as Goldman
Sachs or Morgan Stanley (before the Dean
Witter Reynolds merger of 1997), to
distinguish those divisions' services from
mass-market offerings, but has since
spread throughout the financial-services
industry. Family offices that had formerly
served just one family opened their doors
to other families, and the term Multi-
family office was coined. Accounting firms
and investment advisory boutiques created
multi-family offices as well. Certain larger
firms (UBS, Morgan Stanley and Merrill
Lynch) have "tiered" their platforms – with
separate branch systems and advisor-
training programs, distinguishing "Private
Wealth Management" from "Wealth
Management", with the latter term
denoting the same type of services but
with a lower degree of customization and
delivered to mass affluent clients. At
Morgan Stanley, the "Private Wealth
Management" retail division focuses on
serving clients with greater than $20
million in investment assets while "Global
Wealth Management" focuses on accounts
smaller than $10 million.
In the late 1980s, private banks and

brokerage firms began to offer seminars
and client events designed to showcase
the expertise and capabilities of the
sponsoring firm. Within a few years a new
business model emerged – Family Office
Exchange in 1990, the Institute for Private
Investors in 1991, and CCC Alliance in 1995.
These companies aimed to offer an online
community as well as a network of peers
for ultra high-net-worth individuals and
their families. These entities have grown
since the 1990s, with total IT spending (for
example) by the global wealth
management industry predicted to reach
$35bn by 2016, including heavy investment
in digital channels.[5]
Wealth management can be provided by

large corporate entities, independent
financial advisers or multi-licensed
portfolio managers who design services to
focus on high-net-worth clients. Large
banks and large brokerage houses create
segmentation marketing-strategies to sell
both proprietary and non-proprietary
products and services to investors
designated as potential high-net-worth
clients. Independent wealth-managers use
their experience in estate planning, risk
management, and their affiliations with
tax and legal specialists, to manage the
diverse holdings of high-net-worth clients.
Banks and brokerage firms use advisory
talent-pools to aggregate these same
services.
The Great Recession of the late 2000s

caused investors to address concerns
within their portfolios.[6] For this reason
wealth managers have been advised that
clients have a greater need to understand,
access, and communicate with advisers
about their situation.[7]
Life goals
As the term wealth management has
become more common, some companies
have shifted towards a model which asks
clients about life goals[8], working
environments, and spending patterns as a
way to increase communication.[9] In 2014
Barron's reviewed "Wealth Management
Unwrapped," a book addressed to
investors without endorsing any one firm
or strategy. Increasingly the industry
recognized wealth management was more
than an investment advisory discipline.[10]
In 2015, United Capital rebranded their
wealth management services using the
term "financial life management", which,
according to the company, was intended to
more clearly define the difference
between wealth management companies
and more affordable brokerage firms.[11]
The same year Merrill Lynch began a
program, Merrill Lynch Clear, which asks
investors to describe life goals, and
includes an educational program for
clients' children.[9]
Private banking and wealth

management rankings
According to Euromoney's annual Private
banking and wealth management ranking
2013, which consider (amongst other
factors) assets under management, net
income and net new assets, global private
banking assets under management grew
just 10.8%YoY (compared with 16.7% ten
years ago).[12]
The largest private banks and wealth

managers in the world as of 2018 are as
follows:[13]
2018 Rank Company Assets Under Management (AUM)
1 UBS $2,403 billion
2 Bank of America Merrill Lynch $1,080 billion
3 Morgan Stanley $1,045 billion
4 Credit Suisse $792 billion
5 J.P.Morgan Private Bank $526 billion
6 Citi Private Bank $460 billion
7 BNP Paribas $436.7 billion
8 Goldman Sachs $394.3 billion
9 Julius Baer $388.3 billion
10 China Merchants Bank $292.8 billion
World Wealth Report 2013
The 2013 World Wealth Report, released in

June 2013, showed that despite the
turbulence of the global economy,
particularly in the Eurozone, both the
population and wealth of global HNWIs
reached significant new highs in 2012. Even
though the year got off to a shaky start,
HNWIs ultimately benefitted from strong
market returns in spite of sluggish global
GDP growth.[14] The report was widely
welcomed as good news for the private
wealth management sector.
The 2013 edition of the World Wealth

Report also included the inaugural
Capgemini, RBC Wealth Management and
Scorpio Partnership Global HNW Insights
Survey. The survey represents one of the
largest and most in-depth surveys of high-
net-worth individuals ever conducted,
surveying more than 4,400 HNWIs across 21
major wealth markets.
This survey-driven section of the report
aimed to provide perspectives from the
world's wealthy. Key findings included:
In Q1, 2013, around 61% of HNWIs said

they have trust and confidence in their
wealth managers and firms, an increase
of roughly four and three percentage
points respectively, from 2012.[15]
75.4% of HNWIs around the globe cited
confidence in their ability to generate
wealth over the next year.[14]
52.6% of HNWIs gave their advisors and
support staff a strong performance
rating for service.[14]
See also
Private banking
Robo-advisor
References
1. "BC Gateways | Blog" . BC Gateways |
Blockchain | Financial Services. Retrieved
2018-09-17.
2. CSWP
3. David Teather. Richlists . The Guardian.
25 June 2008.
4. Fowler, William Franklin (1933).
Fishermen and fish: A sequel to For
America, an interpretation and plan .
Lynbrook, N.Y: W.F. Fowler. p. 38. Retrieved
2013-01-30. "To the inefficiency of political
control of government, which is the
principal cause of unsound conditions,
they would grant the additional authority
and responsibility of wealth management."
5. Wealth Management Technology
Spending Through 2016 (July 2012)
6. Yeh, C: "Investors Challenge Market
'Truths'", CFA Institute Private Wealth
Management, August 2009.
7. Costa, L: "Questions Replace Investment
'Truths': A Comment", CFA Institute Private
Wealth Management, May 2009.
Quote:"This state of affairs poses a
dilemma for wealth managers, who, for a
generation, have adhered to the core
principles of asset allocation and earned
their keep by preaching the mantras of 'buy
and hold', 'invest for the long term', and
when things get tough, 'stay the course'."
8. "How can "goals-based" wealth
management prepare me for different life
stages? - Worth" . Worth.
9. Sullivan, Paul (March 20, 2015).
"Financial advisers seek to inject a more
human element" . The New York Times.
Retrieved September 17, 2015.
10. Welch, Scott, "Perspectives on Serving
the Ultra-High-Net Space An Interview with
Jean L.P. Brunel and Charlotte Beyer"
IMCA Wealth Management Monitor,
Jan/Feb 2016
11. Gil Weinreich (March 25, 2015). "United
Capital's Duran: Wealth management is
dead. Long live life management!" .
ThinkAdvisor. ALM. Retrieved
September 17, 2015.
12. Annual private banking industry assets
under management
13. "The 15 biggest wealth managers in the
world" . Business Insider. Retrieved June 1,
2018.
14. World Wealth Report 2013
15. World Wealth Report 2012, Figure 11
Further reading
Butler, Jason (2014). The Financial Times
Guide to Wealth Management: How to
plan, invest and protect your financial
assets. FT Publishing International.
ISBN 978-1-292-00469-3.
Spear's Wealth Management Survey,
"Spear's Magazine" . Spear's Magazine.
Harrington, Brooke (2016). Capital
Without Borders: Wealth Managers and
the One Percent. Cambridge,
Massachusetts: Harvard University
Press. ISBN 9780674743809.
OCLC 944339474 .
External links
Investment Management U.S. Treasury
Handbook
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title=Wealth_management&oldid=888293505"
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Wealth management

Wealth management is an investment-

Private wealth management

Traditionally, the wealthiest retail clients

The CFA Institute curriculum on private-

The term "wealth management" occurs at

In the late 1980s, private banks and

Wealth management can be provided by

The Great Recession of the late 2000s

Private banking and wealth

The largest private banks and wealth

1 UBS $2,403 billion

2 Bank of America Merrill Lynch $1,080 billion

3 Morgan Stanley $1,045 billion

4 Credit Suisse $792 billion

5 J.P.Morgan Private Bank $526 billion

6 Citi Private Bank $460 billion

7 BNP Paribas $436.7 billion

8 Goldman Sachs $394.3 billion

9 Julius Baer $388.3 billion

10 China Merchants Bank $292.8 billion

World Wealth Report 2013

The 2013 World Wealth Report, released in

The 2013 edition of the World Wealth

In Q1, 2013, around 61% of HNWIs said

Last edited 8 days ago by Psantora

Content is available under CC BY-SA 3.0 unless

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