And so 2018 is drawing to a close. It was an odd year. A stop-start year.
Growth was modest against turbulent markets. The challenger robos felt less potent in terms of how they might change the world. Assets rose modestly although the bigger robos did grow customer numbers in a respectable way. The posh Swiss lot at UBS just weren’t convinced and killed off robo before it had even drawn breath.
The biggest of the traditional DIY platforms continue to develop – Hargreaves (still) rules Britannia, Interactive Investor has been shopping, Barclays directors have been given IT voodoo dolls for Christmas whilst Fidelity is yet to find its mojo and strike a noteworthy pose. AJ Bell had its IPO which probably saw more than a few staff in Paternoster Square hostelries last Friday long after they should have been in bed.
As we draw breath and try and get our final 2018 projects over the line, here are a few predictions from me of what I think 2019 might have in store.
Growth – increase of circa 25%
AUA increased by 15% this year. If we neutralise the impact of stock market levels, I’d expect to see a greater increase this coming year fuelled by the wealth march of the banks, the knock-on effect of auto enrolment and the gradual provider trend to introduce new segments to investing.
Thematic investment – making investing day-to-day
Taking their cues from the likes of Motif (US) and eToro, the digital challengers will increasingly try to engage younger investors with the lure of brand names and themes. Whether that’s investing in clean energy or blockchain or Apple, Zara and Monzo, we’ll see a rising attempt to make the connection between our investing behaviours and day-to-day life. Following on from this:
Social or impact investing
The dialogue will change from a negative concept about what we mustn’t do to a positive push about what we can do. Those who focus on evidencing impact rather than industry arguments about who’s doing it right will see traction.
Women – changing the conversation to correct the obvious imbalance
Although it feels odd to describe a gender as a theme, 2019 will be the year when the industry moves on from its increasingly tiresome behaviour of thinking of diversity as solely a gender issue, and hosting endless awards to celebrate Best Female Person To Turn Up And Do Her Job ( controversial!) whilst not making attempts to tackle the consumer engagement issue at the same time. The efforts will expand outwards, tackling the collective inability to engage women customers with the investing dia -sorry- monologue.
Banks – groundhog day or new dawn?
With most of the big brands having wheezed an investment ‘MVP’ into life, 2019 is the year when the business plans will need to be justified. That means a lot of effort will go into targeting those providers’ own cash saver customers which – if done correctly – will bring new customers and new money into the industry. JVs and a gradual return to advice will also be on the cards for the banks. Thinking about suitability and delivering good advice will have to go further than proudly turning people away who don’t have 3 months’ income in cash.
Along with all of that, on our radar are the FCA’s project to force, I mean ‘encourage’, asset managers to think about value for customers; the platform study due out in Q1; the pensions dashboard which has kickstarted inelegant scrapping for the right to be the customer’s hub and investment pathways, guidance or advice, whichever way you choose to describe it.
Have a cracking Christmas and we look forward to seeing you again in 2019.