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Morgan Stanley’s Big Move to Win $2 Trillion Its Clients Hold With Competitors

May 30, 2018

Morgan Stanley believes it can almost double the $2.4 trillion its wealth management unit currently manages by convincing existing clients to bring their outside assets onto its platform too, Bloomberg writes.

To do so, the wirehouse believes it can use Aladdin, BlackRock’s risk management platform that Morgan Stanley has been integrating into its practice over the past two years, Andy Saperstein, co-head of Morgan Stanley’s wealth management unit, said at a Deutsche Bank-hosted conference in New York on Tuesday, according to the news service.

Aladdin will let Morgan Stanley pinpoint where clients are taking on more risk than their risk profiles allow, according to Saperstein. That in turn could convince them to bring the estimated $2 trillion in assets they hold with other firms to Morgan Stanley’s wealth management platform, he said, according to the newswire.

Morgan Stanley isn’t alone among large brokerages to harness Aladdin’s technology, Bloomberg writes. UBS’s wealth management unit began using Aladdin last year for portfolio analysis. But Saperstein believes Morgan Stanley is ahead of the competition.

“Other firms have and will look to leverage Aladdin," he said, according to the news service. “However, no firm has even begun to spend the time or money to integrate it into their platform.”

Going after assets held at other institutions isn’t the only thing for which Morgan Stanley is using technology. At the same conference, Saperstein said the wirehouse has been using robots to help human advisors deal with clients during major market downturns, according to Business Insider. Calming client worries and ensuring they don’t panic and sell off can take hours on the phone, so Morgan Stanley is using technology to help reduce that time, the web publication writes. The firm is employing artificial intelligence to write customized emails for its 16,000 advisors to send on to their clients during market sell-offs, Saperstein said, according to Business Insider.

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Despite optimism about what technology can do for the firm, Saperstein said Morgan Stanley is facing “obvious headwinds” — the company’s transaction activity slowed in March and remained at a slower pace through April and May, he said at the conference, according to CNBC. Another obstacle to robust growth has been in fee-based accounts, where pricing has been relatively low, he said, according to the network.

By Alex Padalka
  • To read the Business Insider article cited in this story, click here.
  • To read the Bloomberg article cited in this story, click here.
  • To read the CNBC article cited in this story, click here.