More advisers see artificial intelligence (AI) as the biggest factor impacting on their business in the future than other areas such as regulation and ESG, research from Downing Fund Managers has found.
The survey of advisers discovered nearly half (46%) believe AI and its potential to boost efficiency, provide more personalised insight and automation will have the most impact on the sector over the next five years.
That was well ahead of the 28% who believe that ESG investing is becoming more important to investors.
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Just over a fifth (22%) believe regulatory changes and tougher compliance standards aimed at increasing transparency, reducing fees and protecting customers will have the most influence on the industry over the next five years.
Downing’s research also found less than one in 10 (9%) believe fintech and the predicted growth of passive investing will shape the industry the most, while only 7% pointed to the growth of alternative investments and private markets.
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Simon Evan-Cook, manager of the Downing Fox range of Funds of Funds, said: “It’s fascinating how quickly AI has become such a major issue for advisers. It’s not hard to see how it could work in their world, particularly in helping to fill the advice gap.
“It also points to advisers worrying about rising competition from AI, and here we think good active products like Downing Fox will help in differentiating human advisers from the next wave of adviserbots.”
