Ivan Illán has watched the rise of AI in the field of wealth management from its inception. As the founder and chief investment officer at Aligne Wealth Advisors, he says that while AI is innovative, there are also complexities and challenges that come with its integration, especially within heavily regulated industries like finance.
"Certainly our regulator, the SEC, has gotten very interested in this ... they’re being very punitive on firms that are misrepresenting AI as a core driver of results in their investment strategies.”
Despite the early-stage nature of AI tools in investment management, Aligne Wealth Advisors is eyeing up how the new tech could help their internal processes – with the team set to roll out some of these new initiatives in the winter of this year. Speaking on AI in general, Illán is cautiously optimistic about its capabilities – but doesn’t shy away from confronting its limitations, too.
“Now you have a technology that essentially can be scaled across dozens of people very easily. It provides this response of a bulleted, very specific narrative about why we believe what we believe,” he says.
While AI has made strides in operations across the sector – and more to some within his own firm – Illán is quick to caution against overstating its current capabilities in direct investment decision-making.
“It wasn’t like that 12 months ago,” he says. “As time has progressed, it’s really become much more focused, and its answers are so much more relevant to our work.”
In terms of research, AI has become a tool for Aligne’s investment team, which must sift through vast amounts of economic data and central bank reports.
“Most of my days are spent in research," Illán admits – and the sheer volume of data can be overwhelming. “We can ask the AI tool ... what else could this be impacting that we’re not thinking about?” he explains, indicating that while AI doesn’t always produce revolutionary insights, “maybe half of the time, it will offer one interesting insight that we really hadn’t thought about.”
However, Illán is realistic about AI’s current limitations in portfolio management.
“In us trying to develop unique insights, which drive alpha, we accept the limitations of a very wonky, clunky kind of system,” he tells IN.
Looking forward, Illán sees operational enhancements as the most promising area in which AI can revolutionize the work of registered investment advisors (RIAs). And one of the most significant advantages AI offers is timesaving, which in turn allows firms to allocate more resources to growth-related activities.
“That person is able to focus all that time, which is many hours per week, on doing other things that contribute to the growth of the business,” he explains. By automating routine tasks, AI frees up human resources to focus on higher-value activities. Illán envisions a future where AI could do the work of two to three people, a transformation that would be “extraordinary for just the operational ability of a business to grow without having to scale its payroll.”
“It’s time for an economic reset,” wrote the California governor, in a post on X.
Masterworks was launched in 2017 but its RIA, Masterworks Advisers, is just three years old.
One 2017 form, no broker license, and a $42 million gap they say surfaced on a webinar.
Fewer than half of Americans in their peak earning years feel on track for retirement, while many say limited financial knowledge and access to professional guidance are holding them back.
Meanwhile, Wells Fargo hauled advisors overseeing $825 million in the West Coast, while Wedbush has welcomed a seasoned professional from Stifel in California.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
