By Intense Life Desires 
The same day a fintech company’s new AI-driven tax assistant
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Speaking on Tuesday at the UBS Financial Services Conference in Key Biscayne, Florida,
Finn predicted advisors working with new clients will soon be able ask an AI agent “to go and build a portfolio using the investment options available at Morgan Stanley, subject to a number of constraints — asset allocation, historical performance, back-tested, expense ratio, Sharpe ratio, literally anything you would want to build a portfolio.”
On some not-distant day, Finn said, AI tools will be “as good as what anybody could do on their own.”
But like many of his counterparts in the industry, Finn remains convinced that humans will maintain their place in wealth management.
“Clients are still going to want advisors to leverage that technology,” he said. “We’ve got the benefit, though, of having the scale and the resources to be able to make sure that that technology is best in class and most effective and unlocks the most doors.”
Using AI for portfolio construction is viewed as a final frontier by many in wealth management, since it involves taking possible risks with client assets and raises various regulatory concerns. Finn said human advisors at Morgan Stanley will have the final say on any AI-generated recommendations.
“You get to approve it, and then it gets implemented without any more clicks,” he said.
“I think AI is going to enhance the quality of advice, and it’s going to help advisors scale and be able to serve more clients more effectively with the same set of resources,” Finn added. “I think it’s an efficiency play, and I think it’s an effectiveness play.”
Finn’s remarks came the same day that the financial software firm Altruist
“The selloff appears tied to broader concerns about AI disrupting the financial advice and wealth management model,” said Neil Sipes, an analyst at Bloomberg Intelligence.
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Morgan Stanley looks to J.A.R.V.I.S. from ‘Iron Man’ movies
The disruption comes amid wealth managers’ ongoing search for ways to move beyond the advanced chatbots now commonly associated with AI into the
Finn said the inspiration for the portfolio-building super agent is J.A.R.V.I.S., the fictional AI assistant to the Tony Stark character in the “Iron Man” movies.
“That is the reference point,” he said. “It’s designed to enable the advisors to direct the work, but not have to do the work”
Finn said some of the super agents Morgan Stanley is building will serve as virtual assistants to the client service associates who already work alongside advisors. These super agents, Finn said, will not just “retrieve information like a normal bot can today, but it can take action.”
“So move money, open accounts, change beneficiaries,” he said. “The goal is to automate a lot of the routinized tasks so [client service associates] can spend more time on the higher value-add tasks, i.e., interacting with clients.”
Morgan Stanley also plans to have super agents available to respond to client requests at any time of the day. First that would entail having them perform tasks like reporting account balances and sending tax documents.
Later, the agent will move on to tasks like sending money and paying bills.
“Obviously the fraud risk goes up with number two,” Finn said. “So we are sequencing it because it is important to discharge our guardianship responsibilities.”
Finn said the super agents could be asked to whip up five tax-savings plans for a given client, produce an appendix of the performance of each strategy modeled over time and then “put it all on a simple page with the pros and cons” of each.
At a more basic level, advisors meeting clients could ask a super agent to “Give me a list of the top ideas I could bring to them to deepen their relationship with Morgan Stanley, based on what other advisors like me have done with other clients like them,” he said. “So you get this peer-collaboration element to it as well.”
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Wealth management’s future not tech only, not human only
Unlike Morgan Stanley early use of AI like large language models, its planned super agents will be able to ingest “the entirety of the historical context” of individual clients, largely by pulling information from emails and the firm’s customer relationship management system.
“So its inference ability is off-the-charts good,” Finn said. “And it can respond back to the client in the same tone that the team has used over the course of that relationship.”
Morgan Stanley has long been at the forefront of adopting new technologies to relieve its advisors of routine tasks and free up their time for working with clients. Indeed, Finn said as far back as 2016 — when the first wave of automated-portfolio builders known as robo advisors was entering the market — Morgan Stanley had already decided that “the future of wealth management” would not be solely about technology.
“And it was not going to be humans only, but it was going to be a best of breed integration of the two,” he added. “We have been intentional in pursuing that vision ever since.”
The firm in 2023 announced it had entered into
Its AIMS Debrief system, for instance, makes
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Morgan Stanley’s trade-off between profit margins, investing in AI
Finn said Morgan Stanley is constantly striking a balance between investing in technology and obtaining stronger profit margins. The firm last year reached a long-held goal of achieving a
Finn said Tuesday that the firm could easily send that margin even higher. But those gains would come at the expense of the sorts of reinvestments that Finn and his colleagues see as crucial to Morgan Stanley’s business prospects.
“Of course, we could float our margin up a couple 100 basis points right now if we stopped making the investment, but that would be trading off near-term, medium-term growth,” he said. “We think this is actually the exact wrong time to do that, because we believe we’re sitting at the precipice of the largest wealth management opportunity in history.”
Finn noted the expected “great wealth transfer,” when baby boomers will be handing down tens of trillions of dollars to their heirs. He also spoke of the vast opportunities present at a firm like Morgan Stanley, which can bring to bear expertise not only in wealth management, but also investment banking and managing compensation plans for employers.
Finn also said Morgan Stanley’s push to integrate its various divisions in recent years “is leading to real, outsized results in the wealth management business, from leads and relationships starting in institutional and coming this way and going the other way as well.”
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Wells Fargo also bridging bank, wealth management businesses
Morgan Stanley is far from alone in seeking to knock down internal barriers separating various business lines. Speaking earlier in the day at the UBS conference,
Such cross-selling is often viewed as a way to not only secure new sources of revenue but also give clients fewer reasons to seek out financial services at other institutions. Santomassimo said some of
“So there’s a huge opportunity to better serve those customers,” he said. “And if we can do a good job on the wealth management side of that equation, the data would suggest they’ll bring 2X the banking and lending wallet, as well.”
The Premier unit operates alongside the firm’s regular
“And they’re not little, small mom and pop teams,” Santomassimo said. “In a lot of cases, they’re really big scale teams that are growing and really want our platform, our balance sheet, to do interesting things on the lending side with their clients as well.”