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The inaugural conference collaboration between Ritholtz Wealth Management and Inside ETFs was nothing short of a blazing success.  With 700+ attendees and a sold-out Scottsdale, Arizona resort (yes, it was hot – thus, the blazing reference), the confab was an inspiring blend of energy and intelligence, with a focus on the future.  Yes, the future.  That’s ultimately what brought forward-thinking financial advisors to the desert.  Wealth/Stack was billed as bridging the gap between technology, investment management, and practice management.  A STACKED lineup of speakers delivered on every front to advisors searching for the oasis of future success for their practices and more importantly, their clients.

Picture courtesy of Josh Brown


Two quick observations before offering my five key takeaways:

-> The crowd was notably younger and more diverse than typical investment conferences.  This is extremely telling about the future of advice.  Baby boomers are set to transfer some $30 trillion to their kids and grandkids over the next several decades.  Is the 65-year-old advisor sitting in a marble floored, mahogany furnitured office and counting the minutes until tee-time going to properly serve this younger and increasingly diverse generation?  Please.  Wealth/Stack attendees are the future of investment advice and know the traditional model needs to evolve.  Advisors clinging to the old ways of doing things are hoping to simply ride the coattails of prior success off into the sunset.  This sea change was reflected in who attended Wealth/Stack.

-> While you might think $30 trillion is enough to create fierce competition and envy among the future of financial advice, the reality is exactly opposite.  The next generation advisor values collaboration with their “competition”.  That was on full display at the conference.  Why?  Because the future advisor is most concerned about their clients.  Advisors truly in it for the right reasons aren’t worried about the competition.  That creates an environment where advisors are hungry to learn from the most successful advisors to ensure their clients are receiving the best advice and experience.  Why would already successful advisors want to help?  Because they know, at some point, they may need to lean on others to deliver the best experience to their clients.  They also realize the importance of an entire industry putting its best foot forward.  There is no shortage of people who need good advice.  There is a shortage of advisors offering good advice.  Next generation advisors are leveraging collaboration to help fill this gap.

Without further ado, my five key takeaways from Wealth/Stack:

1) “Uber, but for financial advice”.  Investors now expect an “Uber” or “Tesla” experience from their advisors.  Consider the technological innovation over the past five or ten years.  Everything is at your fingertips.  If you want a dish from a favorite restaurant delivered on demand, click a few buttons to customize your order, pay electronically, and wa-la – it shows up at your doorstep.  Want to customize a car?  The technology we interact with every day is convenient, personalized, elegant, and transparent.  That is now the standard for financial advice.  Wealth/Stack hosted standing room only showcases where some of the most innovative fintech firms in the country demonstrated the latest tools for advisors.  The ability for advisors to deliver an “Uber” financial advice experience to clients is quickly becoming a reality.  Successful advisors will embrace this new wave of technology.

2) Direct indexing = Tesla Experience.  I would argue OSAM CEO Patrick O’Shaughnessy (who is a masterful presenter by the way) created the biggest buzz at Wealth/Stack with the unveiling of Canvas, a platform allowing advisors to deliver customized portfolios to clients.  What does that mean?  Well, consider the client wishing to invest in the S&P 500, but who owns a decent chunk of stock through their employer (let’s assume Apple, currently the second largest holding in the S&P 500) and who also hates the idea of owning gun stocks.  Canvas allows advisors to build the S&P 500 minus those particular stocks, while also delivering tax optimization.  Why does this matter?  Again, the “Tesla experience”.  People now expect a tailored approach in nearly every aspect of their lives.  Firms like OSAM are providing tools to make that a reality in investing.  I have some reservations about direct indexing (namely costs, tracking error, and client reporting), but there is no denying this will be part of the future investment landscape.

3) ETFs are still THE investment technology.  While some have suggested direct indexing might be an “ETF killer”, ETFs are clearly still front and center with next gen advisors.  Wealth/Stack featured several panels on ETFs.  Do you know what wasn’t featured on any panels?  Mutual funds.  Or variable annuities.  Or non-traded REITs.  Why?  Because these are “old” technologies.  ETFs are Uber.  Mutual funds are like whistling down an expensive taxi cab that you hope gets you to the right location.  ETF issuers were also well represented at the event (Cambria and Meb Faber deserve a shout out for their sponsorship of Wealth/Stack and unmissable ad placement!).

4) “A conversation… but on the blockchain”.  Speaking of new investment technology, financial advisors better quickly get acquainted with crypto.  If an advisor can’t explain the basics of bitcoin and blockchain, clients will look elsewhere.  The topic of crypto came up in multiple conversations I had throughout the conference.  Bitwise’s Matt Hougan (another masterful presenter) offered a compelling case for inclusion of crypto in an investment portfolio.  This particular comment made an impact: “Crypto will disrupt finance just as surely as Amazon disrupted Sears”.  Whether you love it, hate it, or perhaps it just amuses you, crypto is here to stay.  Remember, advisors should be fully educated and prepared to have conversations on investments they view as both good AND bad.

5) Fee War –> Service War.  Much has been made of fee wars across the financial services landscape.’s Dave Nadig delivered an energetic keynote where he argued the future of financial advice is delivering value-added services, not simply offering something for the lowest price possible.

Think Amazon Prime.  For an annual fee, customers have access to free shipping, movies, music, books, and more.  Amazon relentlessly focuses on delivering value-added services to customers.  That’s the future of financial advice.  Clients need help on everything from kids’ college planning to buying cars to renting out their Airbnbs.  Dave explained how “people are messy, human creatures.  It’s hard to scale advice, hard to scale execution”.  In other words, as important as technology is and will be to financial advisors, it can’t automate everything.  Human advisors will still play a crucial role in helping clients navigate their financial futures.  Creative Planning President Peter Mallouk emphasized this point:

“Tech isn’t what makes a business great, people are what makes a business great.”

And what about the fee model?  Will advisor fees morph into an Amazon Prime-like subscription?  Perhaps.  Time will tell.  But the key takeaway is advisors need to adopt a Jeff Bezos-like philosophy towards relentlessly delivering value to clients.

I’ll close with this from Ritholtz CEO Josh Brown:

“A good advisor is both coach and quarterback; on-demand psychologist and reliable friend; historian and futurist. The technology becomes increasingly important in a business as competitive and demanding as advisory.”

I’m already looking forward to Wealth/Stack 2020!