(Investorideas.com
Newswire) a go-to platform for big investing ideas, including AI and
tech stocks issues market commentary from deVere Group.
The AI advances now forcing a violent repricing across wealth
management are set to accelerate consolidation across financial
services, concentrating market share in “heavyweight global
advisory firms equipped to handle complexity that algorithms alone
cannot.”
That is the bold prediction from Nigel Green, chief executive of
deVere Group, as stocks across the sector retreat following the
launch of a new artificial intelligence-powered tax planning tool
that claims to generate fully personalized strategies within
minutes.
He says: “This is a reckoning for financial services.”
“Investors are legitimately questioning what part of advice
is process and what part is genuinely strategic.”
Markets have reacted sharply to the idea that AI can analyze tax
returns and income data almost instantly, raising concerns that
traditional advisory fee models face structural compression.
Automation threatens to make elements of domestic tax optimization
faster, cheaper and more accessible.
Nigel Green agrees that part of the industry will now change
permanently.
“AI will compress the commoditized end of advice. Routine,
single-country planning will become more efficient and more price
competitive. This transition is underway in real-time,” he
says.
However, he argues that the selloff reflects an assumption that
wealth management is primarily about calculating tax outcomes within
one jurisdiction.
In reality, global wealth has become more complex precisely at a
time when geopolitics is fragmenting the international system.
“An algorithm operating inside one tax code works in a
contained framework,” Nigel Green explains.
“But clients increasingly hold assets, pensions and business
interests across multiple jurisdictions. Residency rules shift,
bilateral tax treaties evolve, capital gains treatment varies, and
regulatory divergence between regions is widening.”
He also adds that AI’s limitations become more visible as
geopolitical risk intensifies.
“Geopolitics now directly influences portfolio construction.
Trade disputes, sanctions, regional conflicts and regulatory
realignment between blocs affect capital flows, currency exposure
and asset allocation decisions,” he says.
“When wealth depends upon several highly complex, highly
societal, highly human and consistently evolving geopolitical
scenarios all at the same time, advisory decisions can’t be
reduced to an AI data set.”
He continues: “Governments adjust tax policy in response to
debt pressures and domestic priorities. AI can process data
quickly, but it can’t independently anticipate how shifting
geopolitical realities alter long-term structuring
decisions.”
He believes the current repricing is part of a broader segmentation
of the sector.
“Firms built around domestic, process-driven advice models
are more exposed to automation-led fee compression,” notes
the deVere CEO.
“Firms operating across numerous jurisdictions, coordinating
wealth through complex regulatory, tax and geopolitical
environments, sit in a different category.”
Historically, operating internationally increased operational burden
and compliance cost.
“In an era where automation reduces the value of routine
tasks, that same international complexity becomes strategic
insulation.”
“AI simplifies the uniform. Global wealth management is
never uniform.”
He expects consolidation to accelerate as investors and clients
differentiate between commoditised advisory functions and globally
integrated advisory platforms.
“Tech will reshape delivery, but it won’t eliminate
the need for experienced oversight. Indeed, far from it. It
becomes more valuable than ever.”
Nigel Green concludes: “The sharp market reaction due to AI
advances marks the beginning of differentiation rather than
decline, and the start of a new, competitive hierarchy within
wealth management.”
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