MyPrivateBanking Blog
Daily Comments on the World of Wealth Management

Archive for August, 2014

How Spielberg’s AI is becoming real already

Friday, August 29th, 2014

What began as a lunatic idea years ago is entering our pockets today. Cyborgs, intelligent assistants, robots – they have many names but research labs and start-ups all over the world are working on the same idea: combining human and artificial components to end up with efficiency.

These days you cannot surf the internet without coming across several articles on artificial intelligence. This one really caught my attention as it reveals what is going on behind the doors of the labs of Viv, a start-up led by the inventors of Siri.

The crux on which they are currently working is the linking of multiple queries based on a cloud system working like a ‘global brain’. The objective of this kind of knowledge net is that the intelligent assistant should be able to actively learn from the incoming queries and even become able to predict what its user needs next.

Just try to imagine the impact this revolution will have on the finance industry – for instance, an investor could ask his smartphone “How can I build a portfolio with lowest possible fees limiting my expected maximum loss to 10% per year?” instead of meeting with his advisor. Along with an increasingly self-determined client, these changes draw a dire picture of the industry’s future and it will be up to the wealth managers and banks to find new ways for becoming indispensable.


Why standardization of bank app security is great news

Wednesday, August 27th, 2014

MyPrivateBanking welcomes the news that the British Standards Institute has launched its standard for security of transactions on mobile apps. This means that the public will benefit from being able to check for the presence of BSI’s well-respected kitemark as its approval for the level of security for treatment of app users’ personal and financial details.

The first to receive the app security kitemark is Barclays Bank for its Pingit mobile payment service and mobile banking apps. In the longer term it is expected that the kitemark use will be extended beyond banking and finance to other commercial apps such as ones for (paid for) entertainment but clearly the need for easily understandable standards is most pressing for financial service users simply because it is here that security violations expose users to the greatest financial losses.

Here at MyPrivateBanking, we have long considered that easily understandable and verifiable security standards are a must in terms of what financial services companies owe to clients and this is especially in relatively new areas such as banking apps. Up until now reference by banks to existing standards for Internet security, such as ISO 27001 (on which the new kitemark is partly based) and 27032, has been patchy at best. The launch of a kitemark for financial app security, more consumer-oriented than ISO standards, is especially welcome. The new standard requires meeting security standards and regular follow-up checks and ‘penetration tests’ by the BSI. Hopefully, it will be adopted widely internationally.

The full name of the new standard is BSI KitemarkTM for Secure Digital Transactions’. BSI say that it has been developed to help consumers confidently and easily identify websites or apps they can trust with their financial and/or personal details.


Samsung making wearable progress

Tuesday, August 26th, 2014

(by Laura Elsler, analyst)

This post is about a topic which is not directly related to the financial services industry. But we think that the development is so profound and implications are far reaching that we would like to discuss it on our blog.

Samsung, Apple’s mightiest competitor in the area of mobile devices, is about to release a project called S.A.M.I./Simband. Behind these acronyms, which rather evoke thoughts of  robots controlled by artificial intelligence and sci-fi movies, is a cloud-based platform and reference technology for wearable devices. The Simband is a sensor packed wrist-band which measures physiological and ambient data. S.A.M.I. translates to Samsung Architecture for Multimodal Interaction and shall allow wearable devices with different operating systems to connect to it, store data, run algorithms and send information back to the device.

Putting it differently, Samsung attempts nothing less than to become the central hub for all data which run on wearable devices, an industry which is expected to grow 6-fold until 2018.  All devices, which consumers will wear on their bodies, or which connect their home with their car and the office, may run on this platform.

Unlike the Facebook model of leveraging data, Samsung promised that users and developers will remain owners of their data. If Samsung has yet a model how to cash in on the Simband and S.A.M.I. platform seems questionable. To me it appears, once Samsung is the central player controlling a market growing so strongly, the potential return on this investment can be huge.Of course, Apple is not standing by waching Samsung overtaking them. The Apple Health App is aiming for the same or similar  consumer needs.

Wearable technology has long been predicted to be the next big wave after the smart phone and the tablet. It seems that the battle has finally started. The implications for financial institutions are yet far from clear. But there is no doubt that all aspects of life and business will be touched by this new technology.


Why the Investment Industry Should Look at BuzzFeed

Saturday, August 16th, 2014

(by Francis Groves, Senior Analyst)

A few days ago the MyPrivateBanking team were discussing communication and the topic of bullet point came up. Generation Y members of the team were strongly in favour; ‘bullets are snappy, they help the reader focus.’ The baby-boomer wasn’t so sure; ‘it feels like you’re being shouted at’.

This made me think about the way in which the investment industry customarily communicates with investors, whether they are wealth management clients, retail clients of banks or D-I-Y investors. By and large, even in today’s wired world investment content is surprisingly long-winded. Service providers are still providing commentary in substantial chunks of text; they are publishing as if they have to fill up a certain amount of space. And, collectively, much of what they say is repetitive. They seem to have an old fashioned and now misguided idea of what really works for their readers or, you could say, they are focusing on a type of reader who is time-rich, likes reading and equates financial wisdom with acquiring more and more detail.

Perhaps it’s time for a change to providing investment commentary that’s more suited to younger generations. They’re perfectly happy to read but they really don’t want to read the same things over and over again. They want to know what matters and they only need to be told once that, say, shale gas affects energy prices or that good economic data is bad news because it increases the likelihood of interest rate rises. News in brief columns in the press and short business bulletins on the radio work for them but they need news media to be more helpful still.

Maybe it’s time to try out business news that looks more like Buzzfeed lists and rich and varied graphical content and even to start mining ’standard’ news as if it was big data; think of headlines like: “how many mentions of ‘forward guidance’ has Federal Reserve Chairman, Janet Yellen, made in the last three months?” accompanied by a chart.