The headlines this month have been busy, with crypto-currencies gaining in popularity and much of the sector split on how its impact will ripple out over the coming months and years.
The headlines
The Citi Private Bank has provided an interesting snapshot into Family Office sentiment. Surprisingly, in their report, almost 50% of the firms surveyed aren’t actively considering ESG in their portfolio investments – we think this may have something to do with the 62% whose ESG strategy is determined by the family rather than investment teams or advisors. Will this positioning shift as the next generation begins to play a more prominent role? Also notable were the amount of businesses allocating portfolio investments to crypto-currencies, with half of those surveyed seeing crypto-currency allocations increasing in the next 12 months.
US investors rushed to get their hands on newly launched crypto-currency ETFs. This represents a significant milestone for crypto-currency, which is fast accelerating into the mainstream. Institutional investors are increasingly interested, and it’s becoming easier and easier for retail investors to gain exposure to the asset class. However, unanimous acceptance is still a fair way off, it seems, with opinion very much split.
While crypto-currencies are gaining popularity within the family office community and with retail investors, Jamie Dimon, JP Morgan’s Co-CEO, has restated his view that crypto-currency is worthless. His latest attack focuses on a belief that governments will ultimately step in to regulate the market. However, short of an outright ban, or similarly draconian measures, it’s difficult to see how governments could effectively regulate something like Bitcoin, for example.
Finally, sticking with JP Morgan - the FCA has signed off its acquisition of Nutmeg, giving the group a strong foothold in the UK advice market. We’re expecting to see much more M&A of this type, as established firms start to pick off successful wealth management innovators.
Also, look out this month for:
- Our Wealth Paper, focusing on how the future landscape is shaping up for wealth managers.
- And this piece in Investment Week by our Associate Partner Mary Wong, looks at how strong leadership is vital for the culture shift and industry collaboration needed to truly deliver better financial outcomes for consumers – and how this can transform the business.
And finally, in case you missed it…
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To set your firm up for success, and to help you integrate ESG effectively across your products, investment processes, and operating model, we have developed our proprietary ESG assessment framework, which is available to download now.
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If you’d like to talk about any related issues specific to you or your company, do get in touch.
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