Wealth Managers are in a great position to take advantage of the latest growth and innovation in investment research tools and harness future opportunities to meet evolving client expectations.
2024 is about to wrap up and many articles are surfacing regarding the 2025 winning bets. Of course, it takes more than getting tipped on a few trends and a few promising stocks to find success as investors. In this context, this article is a bit different and focuses on how to turn to technology to gain an edge and use market trends to your advantage.
Imagine keeping up with all the market changes, news, earnings calls, and instantly know how it affects your portfolio…this is the promise of technology that is purpose built for Wealth Managers. Having a clear, at-a-glance overview of your portfolio health leads to better investment decisions, less time analysing the data and a lot more time spent with clients.
The Wealth Management market is expected to grow at 13% to 15% in the next five years and the client expectations are evolving quickly. Clients are now looking for tailored services and access to many more types of investment vehicles. Wealth Managers that can differentiate and meet these new client requirements are the ones who will 10x their business.
To remain competitive, Wealth Management firms need to adopt new ways of delivering services at a fraction of the cost and increase the returns for their clients. Often, this means dealing with an increasing amount of effort for research and analysis while maintaining the same level of staffing.
This article explores the key trends impacting the economy in 2025 and the role technology, specifically investment research tools, will play in helping Wealth Managers navigate these trends to meet client expectations and increase the value of their client portfolios.
Key Trends for 2025
Let’s start by looking at major trends for 2025. It is important to keep these in mind when we assess what tools will provide the best support as we pick an investment strategy for the year.
1. Geopolitical Changes and Tensions
The US election outcome provides some indication as to what sectors will undergo some adjustments. It is expected that trade tensions and tariffs will be imposed by governments on products/components and businesses may be affected as new policies get rolled out. Retailers are likely to be among the most affected by tariffs.
Raw material may also play a significant role in the impact of tariffs. Aluminum is one of the metals that would be the most impacted by US import policies changes and would affect their two top suppliers Canada and Mexico, according to Citigroup analysts. Tariffs on raw material have widespread impact from gross margin for companies that rely on this material to build products to eventually consumer impact. As tariffs get rolled out it will be very important for investors to know what investments on their portfolio are the most exposed to increased cost for US import.
Geopolitical tensions and conflicts are also on the rise and could impact the market by creating volatility, and by generating demand for the Aerospace and Defense industry.
2. Economic Fundamentals
Inflation has been easing up in the past few quarters and interest rates have been lowered both in US and Canada. The question that central banks are wrestling with now is whether the 2% inflation rate is the right target to maintain momentum in the current economy. If interest rates remain stubborn at levels higher than pre pandemic levels, this could affect profitability and slow market growth. Inflation and interest rates are key market indicators that can affect stocks that have a high level of debts and could significantly change the interpretation of balance sheets. This can provide crucial insights on companies’ ability to invest in innovation and remain competitive.
3. Tech Sector and AI Race
Artificial Intelligence has been driving high expectations on market leaders and according to IDC, spending on AI is set to more than double between 2024 and 2028. This is an important trend as corporate budgets will have a significant allocation to AI initiatives; it is still unclear who will generate sustainable favorable financial outcomes from these investments. Spotting early winners through thorough earnings and filings analysis could identify opportunities. In the short term, companies that are fulfilling the demand for AI development and operations are the best positioned for exponential growth. This includes the semiconductor industry as well as the cloud service providers. But quickly, companies that can increase their revenue or performance by leveraging AI will gain an advantage and we will become a key indicator as to the potential of a company in their respective industry.
4. Energy Sector Increasing Demand
The energy sector has been under strain in recent years with a strong pressure to transition to renewable energy, but in the last two years the effect of Artificial Intelligence and the power-hungry data centers has made the challenge even greater. This is creating an opportunity for energy companies that are best positioned to address the energy shortfall or that can deliver on more efficient energy solutions. The trend will lead to 10x companies taking a huge leap forward as they fulfill the demand generated by AI and digital currency mining energy needs. We have seen the effect of AI demand on semiconductor companies such as Nvidia and this may repeat itself in other sectors.
5. Healthcare and Wellness Growth
Aging populations and evolution of both services and research is continuing to drive demand. Detection and prevention companies are experiencing growth as health risks awareness is growing among the general population and preventative treatments are increasingly sought after.
The Wellness sector is gaining traction with record number of people engaging in sports or physical activities and with an upward trend in spending in apparels and equipment. Many industry players could benefit from this trend especially after a boom/bust cycle in this space caused by the COVID-19 pandemic. Finally, the use of new technology to alleviate the staff shortage in the health industry may also uncover new market leader in the health technology sector.
Investor Challenges
There is no silver bullet to keeping up with the market trends and the impact on each equity within a portfolio; the only way is to constantly review high volumes of information and remain intimate with every material change and dependency that affects your portfolio.
This is time consuming to manage and, fortunately, there are many tools available to help. Knowing where to start and how to evaluate each solution can be daunting. Let’s look at the leading tools and help you select what is right for your business.
7 Best Equity Research Tools for 2025
The following solutions are the go-to for wealth managers, with pros and cons for each. For this evaluation, we are focused on the following criteria:
- Periodic updates including full equity research reports that take both market fundamentals and sentiment publications into consideration
- Clear, at-a-glance portfolio visualization
- Accurate, private, reliable and traceable insights
- Deep data sources and customization of investment thesis
- Automated research providing valuable investment guidance without extensive interaction or knowledge of the tool
- Efficiency gains and more time to spend with existing or new clients
1. Charli AI
Pros: Charli AI is the most advanced automated analyst solution for equity research and was recently named a Cool Vendor in the November 2024 Gartner® Cool Vendors™ for Artificial Intelligence in Banking and Investment Services report.
By simply adding tickers to a portfolio, Charli generates a comprehensive equity research report in minutes and provides a portfolio dashboard view with key guidance such as Strength in Fundamentals vs Sentiment, Buy or Sell ratings and Fair Market Value calculations. It can be set to provide periodical updates on portfolios without any interaction required. This is the most autonomous equity research solution on the market and is set to change how investment professionals generate and consume market and equity research in 2025.
Affordable entry level subscription to fit within small team budgets. Built with security and privacy to meet financial services stringent regulations. In terms of data, Charli integrates seamlessly with leaders in the financial data sector.
Cons: Geared towards automation, not a general purpose or financial search tool.
2. FactSet
Pros: Trusted Data and Brand recognition in the industry. Curated earning call transcripts, analyst commentaries and street account. In depth capabilities for research analysts using the FactSet workstation. Mercury offering is providing entry level AI capabilities to facilitate search and surface insights from earnings calls and street account.
Cons: Expensive entry level, mostly geared toward sell side analysts. Difficult to ramp up, need both time and financial investment to generate value. No automation, everything needs to be done manually.
3. Perplexity
Pros: Intuitive user interface geared toward searching for specific information. Financial offering provides fundamental financial data. Easy to get started with free offering. Great for getting familiar with companies and investments. Easy to surface financial fundamentals and surface insights that are publicly available.
Cons: No monitoring capability requires user copilot strategy to drive every question and use each answer to either make decisions or copy paste into content that needs to be created such as equity research reports or client facing investment material. Requires the user to be in front of a screen every step of the way.
4. AlphaSense
Pros: Custom and proprietary content created through interviews with company executives. Valuable data available for private company and broad information available to investigate broad market and industry sectors. Advanced search engine that allows to quickly find relevant documents.
Cons: Requires deep knowledge of the sectors being investigated, long ramp up time to get familiar with the application. No automation or monitoring capabilities, useful in finding information but little time saved as everything needs to be initiated by the user.
5. FinChat
Pros: Easy to use interface and quick ramp up time to get familiar with the application and get access to financial fundamentals. Good organization capability to track investments and easy to access insights using Co-Pilot AI to access indexed data and unstructured data such as company filings.
Cons: No automation capabilities, requires the user to do all the work, no ability to monitor other than numbers and no ability to generate content such as reports or audit trails.
6. Bloomberg
Pros: Trusted Data and Brand recognition in the industry. In dept capabilities for research analysts using the Bloomberg terminal.
Cons: Expensive entry level, mostly geared toward sell side analysts. Difficult to ramp up, need both time and financial investment to generate value. No automation, everything needs to be done manually.
7. Morningstar
Pros: Access to in depth financial data. Quality reports made available to customers and brand recognition in the industry.
Cons: Expensive reports and outdated information, no readily and real time data available in a customer facing format.
Conclusion
One of the biggest challenges for investors is to remove the emotion out of the decision making and know when it’s time to buy or sell a position on a stock. This can only be accomplished by getting access to real time research that removes the need to make gut decisions due to sudden market events. It is also critical to get an unbiased evaluation of investments, with a clear indication of the financial fundamentals vs the market sentiment and determine if an investment is over or under valued.
2025 will mark a turning point in wealth management access to research and will change the way they manage their client’s wealth.