Man vs machine: Why not

By The CONNECT Team | The CONNECT Blog

Nov 15

The financial services industry is trying hard to avoid their own ‘Kodak moment’ – a disruptive existential crisis that could redefine their business and eliminate advantages accumulated over decades. Rather, as Ravi Menon, Managing Director of the Monetary Authority of Singapore said in his opening remarks at the Singapore Fintech Festival this month: “Imagine a world where financial services are built around us – around our life and our needs.”

Technology today allows financial services firms to be more intuitive, transparent and efficient.

Indeed, technology today allows financial services firms to be more intuitive, transparent and efficient. The concept of robo-advice – the use of automation and digital techniques to build and manage portfolios of exchange-traded funds (ETFs) and other instruments for investors1 – has started making waves across the industry.

It’s easy to see why. Traditionally, opaque fees throughout the investment process have been wreaking havoc on performance.

The first robo-advisor was launched in 2008 in the wake of the global financial crisis. The idea was simple. To automate the investment process and reduce fees. An online interface was created to rebalance investor assets within target-date funds.2 Ten years on, the initial idea of a passive online interface has grown to become a $200 billion business.3 The low fees, increased accessibility and transparency were key selling points, and the low minimum balances are attractive to beginners who have less capital to start investing.

So what’s not to love about robo-advisory?

The truth is the process of wealth management can be complex, because humans are complex.

Investors have individual needs to meet and goals to achieve. Some of the investment processes that will lead them to their objectives are easy to automate – through model portfolios backed by algorithms, A.I., and chatbots that can answer their most frequently asked questions.

But from time to time, we need professional advice. As human beings, we have an inherently emotional relationship with our money. When the market falls sharply, a robot can’t advise us against making irrational decisions with our investments and help us navigate unpredictable circumstances. That’s one area where traditional advisors, with years of experience, have an edge.

Increasingly though, neither the robo-advisor nor the human can operate efficiently in isolation – your wealth managers are probably using some form of technology to optimise processes and develop investment strategies. The key is to ensure that advanced technology and sophisticated automated tools can operate hand in hand with the human touch.

This has led to the emergence of a third option: the hybrid model.

The hybrid model

While the debate around technology in wealth management has traditionally pitted man against machine, the hybrid model brings together the best of both worlds. Depending on the type of investor and the complexity of his financial needs, a hybrid model can offer a unique service catered just for him.

For the advisor, technology can be an enabler, to expand their customer relationships, offer better products and services, and grow their business.

On the other hand, robo-advisors, with the addition of the human element, can better understand the clients’ intentions and concerns, leading to more rounded investment solutions.

For the advisor, technology can be an enabler, to expand their customer relationships, offer better products and services, and grow their business.

The hybrid model turns the either/or proposition on its head, and it is no surprise that it resonates most with consumers. Nearly half of high net worth individuals in Asia-Pacific (excluding Japan) prefers hybrid advice for their investment plans.4 Another report estimates that hybrid robo services will manage 10% of total investable wealth by 2025.5

The CONNECT recipe for success

When we launched Singapore’s first and largest robo-advisor CONNECT by Crossbridge, our goal was to bring customised, fee efficient, actively managed investment portfolios to a wider audience – giving clients a personalised asset allocation to suit their risk profile and objectives.

At the heart of CONNECT was a solution that integrated digitally-enabled wealth management with personal advisory service. Clients can speak to a human adviser at any stage of the investment process as Crossbridge Capital is a licensed wealth manager. For clients on the CONNECT platforms, they can access experienced human advisors from our investment team through live chat as well as a dedicated helpline.

This is complementary to our highly intuitive digital interface, which we are constantly improving to create a seamless experience for our clients in every stage of the investment process. Following the recent round of updates, CONNECT was the first pure-play robo-advisor in Singapore to integrate MyInfo, a digital data vault developed by the Government Technology Agency of Singapore to facilitate online transactions. This came shortly after it became the first in Southeast Asia to introduce an Artificial Intelligence-based (AI) learning model, with our ‘Walk of Life’ function designed to help clients track the progress of their financial plans.

We believe in technology, but we don’t think that AI and algorithms have all the answers. As the wealth management industry becomes more aware of technological opportunities – there remains a place for the human element to continuously engage with clients.


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Crossbridge Capital Asia Pte Ltd
3 Temasek Avenue
Level 18 Centennial Tower
Singapore 039190

Regulated by Monetary Authority of Singapore (MAS)

Integrated with Myinfo for seamless account opening


Crossbridge Capital Asia Pte Ltd
One Wallich Street
#24-05 Guoco Tower
Singapore 078881

Regulated by Monetary Authority of Singapore (MAS)

Integrated with MyInfo for seamless account opening