Patrick Ho, Managing Director of iFAST Platform Services (HK) Limited, sees financial adivsers sprinting to a new level with the new services introduced on the iFAST Global Prestige (Hong Kong) platform.

1. By Patrick Ho
Industry Insights
30 OCTOBER 2011 - MARCH 2012
is the letter ‘S’. It means Scalability. Ad-
visers 2.0 will be Scalable. The present
generation of advisers has generally been
able to handle one client at a time. They
make arrangements to meet a client, give
investment advice to that one client and
eventually see through trade placements
for that client. A most hardworking ad-
viser who meets a client every weekday
will cover about 260 clients in a year.
Based on this, a good Adviser 1.0 could
typically oversee 200 or so clients only.
Advisers 2.0 will be different. They
will be able to handle multitudes of cli-
ents. There should be no limits to the
number of clients they could manage
within their portfolio. While they may
only meet one client at a time, which is
B
ehold! A new generation of Advis-
ers is emerging. We call them Ad-
visers 2.0. Unlike the Advisers of
present (Advisers 1.0), this new genera-
tion of Advisers 2.0 will not be satisfied
with simply walking. Advisers 2.0 have
in them the characteristic of moving fast,
very fast. They will in fact SPRINT.
iFAST Global Prestige (iGP) has de-
veloped tools and services to support the
anticipated emergingAdvisers 2.0.As we
explore Advisers 2.0 SPRINT in this arti-
cle, iGP will demonstrate how it seeks to
support their growth.
advisers 2.0 will be
Scalable
The first alphabet of the word SPRINT
a basic requirement for good personal
service, the follow-up advice rendered
could be structured differently through
a good use of technology. Meeting time
with clients could then be shortened
without discounting on the required
quality, thus allowing Advisers 2.0 to
service even more clients.
Seeing this critical need for Advisers
2.0 to scale, iGPhas enhanced its platform
to support the requirement. The Portfolio
Management Services (PMS) system is a
module that allows every single Advis-
ers 2.0 to create various model portfolios
for clients of different investment profile
to invest into. The discretionary function
allows Advisers 2.0 to act on their clients’
behalf. The beauty of the PMS lies in be-
Advisers 2.0 - SPRINT of the
Next Generation Advisers
Patrick Ho, Managing Director of iFAST Platform Services (HK) Ltd, sees financial advisers sprinting
to a new level with the new services introduced on the iFAST Global Prestige (Hong Kong) platform.

2. OCTOBER 2011 - MARCH 2012 31
 Important: See Disclaimer on Page 5 
ing able to provide advice and easily per-
form mass rebalancing of investments for
all clients investing into the portfolios.
With this, Advisers 2.0 simply need
to ensure their clients invest into the right
portfolio during the fact finding stage.
With no change in profile, ongoing re-
balancing transactions will be taken care
of on a mass scale at a portfolio level
through the PMS. Together with iGP’s
strong research support, Advisers 2.0 will
be assisted in maintaining good portfolio
performance, thus giving them more time
to focus on other core advisory functions.
With the investment management
burden taken off them, Advisers 2.0
would be able to focus on Performance
to improve the investment returns of
their clients. Better performance should
reap better rewards, especially when
client interests are aligned. And that is
whereiGP’sperformancefeecalculation
(PFC) system fits in. This system allows
Advisers 2.0 to charge a performance
fee when a certain returns’ threshold
is met. When applied to the PMS, the
PFC will ensure good remuneration for
Advisers 2.0. Clearly when scalability is
achieved, all other benefits, including
monetary, will soon follow.Advisers 2.0
will be Product Savvy
Many advisers used to be insurance
agents. With many years behind them
in the insurance industry, many are very
proficient with insurance products. With
the advent of insurance-linked products
(ILPs), Advisers 1.0 have gained some
knowledge in mutual funds. While these
products may have investment compo-
nents within them, many are not consid-
ered as investment products. As such,
Advisers 1.0’s knowledge in investments
is at most limited.
Advisers 2.0 will see a new breed of
investment savvy professionals rising up
to offer advice on a full suite of invest-
ment products. Insurance and mutual
funds will continue to be one of the sta-
ples of their offerings. But funds will in-
clude hedge funds and exchange traded
funds (ETFs). Other asset classes like
bonds, stocks and properties will form
part of the investment recommendations.
To meet the special appetites of certain
HNWIs, structured products and alter-
native investments into wine and art will
have to be provided. Essentially, the rise
of savvy investors will give rise to prod-
uct-savvy Advisers 2.0.
At iGP, our products team has con-
ducted regular product due diligence to
bring the best products onboard. To date,
the Hong Kong platform offers over 800
mutual funds. These are both author-
ised and unauthorised by the Securities
and Futures Commission (SFC) of Hong
Kong. ETFs listed on the Hong Kong
Stock Exchange have been added onto
the platform in 2010, with plans to add on
the US-listed ETFs in the pipeline. With
the recent launch of direct bonds onto the
platform, clients of Advisers 2.0 are able
to select a full suite of corporate and sov-
ereign bonds. Stocks will also be offered
in time to come.
advisers 2.0 will be
Revenue Wise
Every adviser who stepped into this
wealth management industry seeks to
make a good meaningful living from
what they do. Apart from helping their
clients to retire well, advisers are looking
to earn good remunerations too. While
both Advisers 1.0 and Advisers 2.0 could
potentially make a good living, there is a
core drastic difference in revenue think-
ing between them.
Advisers 1.0 are used to being remu-
nerated with high upfront commissions
from the transactions of the products
they offer to their clients. One simply
needs to look at the kind of products they
sell. For many of these Advisers 1.0, the
high upfront commission form the core
of their overall remuneration package.
Because these commissions are a one-
time income, these Advisers 1.0 will need
to maintain their sales level to maintain
their income level. This may be feasi-
ble in the early years of their career. But
when age catches up, and when expenses
increase with changes in their personal
life, e.g. having growing family commit-
ments, Advisers 1.0 find themselves hav-
ing to work harder than they used to for
a better living.
Coming against Advisers 1.0 will
be the regulatory changes that are tak-
ing root in advanced financial markets
around the world. Where in the past
commission earnings used to be hidden,
the need to disclose commission earnings
in some markets now will make it diffi-
cult for Advisers 1.0 to justify their rec-
ommendations to their clients. In some
markets such as India – with Australia
and the United Kingdom slated to follow
suit in 2012 – regulators have gone as far
as forbid advisers to earn upfront com-
missions from transactions. Such drastic
measures are effectively cutting the life-
line of Advisers 1.0 whose remunerations
are mainly coming from upfront commis-
sions.
Contrast this to Advisers 2.0; the lat-
ter will be revenue wise. They will seek
to be remunerated through their advisory
service rather than through commission
from transactions of product sales. Earn-
ings from advisory fall within the scope
of their advisory services. It protects them
fromoutsideinfluencesandrisks,asthese
will be independent from the underlying
products they advice.
Advisers 2.0 will also seek a balance
in their remuneration structure, formed
by both upfront advisory fees and an on-
going annual advisory fee. The ongoing
fee, justifiably collected for ongoing ad-
vice being rendered, provides a recurring
income that will allow them to build up
a decent income nest. For some Advisers
2.0 who have built a reputable name for
giving good profitable advice, a perform-
ance fee component could also be insti-
tuted.
Having studied all the regulatory
changes, and knowing that the bread and
butter issue will be a critical consideration
to spur the growth of the Independent Fi-
nancial Advisers (IFA) industry, iGP was
launched with the Wrap account offering
in place. The wrap account setup allows
Advisers 2.0 to wrap all available invest-
ment products to charge both an upfront
and an ongoing advisory fee. With this,
Advisers 2.0 can sleep tight at night
knowing that their income is secure, with
iGP helping to collect them efficiently.
advisers 2.0 will be
Informative
Thereisasayingthat‘Informationisking’.
This is true even to Advisers 1.0 who are

3. 32 OCTOBER 2011 - MARCH 2012
very proficient with mortality rates and
other insurance-related information. And
while these are good information, insur-
ance planning alone can no longer satisfy
the demand for a diverse range of quality
information from savvy clients. There is a
void that is looking to be filled.
Advisers 2.0 will be equipped with
real-time access to information on invest-
ment markets around the world. Good
investment product knowledge on vari-
ous asset classes will form the basis from
which detailed research information can
be sourced and delivered. Advisers 2.0
will be apt at delivering this information
in a clear and concise framework to their
end clients.
iFAST, service provider of the iGP
platform, has always prided itself for
having a strong in-house team of content
and research analysts, specialising on
producing markets and funds research.
Together with a full suite of research de-
pository supplied by product providers,
the iGP platform ensures that informa-
tion is made freely available to all Advis-
ers 2.0 using its platform. In addition to
online instant accessibility, information
will also be pushed to Advisers 2.0 via
regular e-Newsletters.
The iGPINSIGHTS magazine is also a
source of information in printed form for
Advisers 2.0. To supplement the knowl-
edge of Advisers 2.0 further, monthly
seminars and opportunities to meet with
experts from product providers are ar-
ranged. iGP believes that better informed
Advisers 2.0 will help create better advice
leading to profitable investments for their
clients, in line with its mission statement
of helping investors to invest globally
and profitably.
advisers 2.0 will be
Network-Building
One of the keys to success in the wealth
management industry is undeniably
linked to networking. Advisers 1.0 are
good at networking to create business
opportunities. But in an industry context,
their network-building effort will at most
be intra-company or intra-team.Advisers
1.0 tend to work on their own, or with col-
leagues from the same team. The support
they receive with therefore be limited to
the company they are associated with.
The new generation of Advisers 2.0
will adopt an abundance mentality where
they will work together to increase their
share of the pie of the business oppor-
tunities in the market. Advisers 2.0 will
adopt an open framework to participate
in an Adviser’s community where they
will learn of the best practice from one
another. Support will be rendered by the
network to help raise the good profile of
Advisers into a force to be reckoned and
accepted not just by the industry play-
ers, but by the greater overall market.
Through such an Adviser’s network, it
is envisaged that paying for advice will
become an acceptable norm for a very
professional service offered.
In 2010, when the SFC went around
requiring advisory companies in Hong
Kong to attain the Type 1 Dealing licence
to continue with their business, iFAST
stepped forward to help facilitate a forum
among its corporate clients to discuss on
a fit and proper response to the regula-
tor. The exercise highlighted the need for
a network to bring the various industry
players together and gave rise to the birth
of ‘iFAST Network’ in Hong Kong. In
March 2011, the network initiated its very
first community service to raise funds for
Japan earthquake relief work.
Operation ‘Help Japan’ managed to
garner 11 financial institutions and their
end clients to raise a total of HKD100,000.
In Singapore, iFAST joined forces with
various platform players to form the Sin-
gapore Investment Platform Association
(SIPA), with the aim of promoting an or-
derly and sustainable growth for the in-
vestment advisory industry in Singapore.
These efforts are slowly bearing the fruits
to spearhead the growth of Advisers 2.0.
advisers 2.0 will be
Technology Embracing
The use of technology has permeated
into the everyday life of people. The evo-
lution from the first Apple computer to
the launch of iPad has changed the way
businesses are conducted. Yet Advisers
1.0 are still very much accustomed to the
traditional form-based transaction me-
dium that is still very prevalent today.Al-
though a pencil and a piece of paper are
still the easiest way to describe money
concepts to clients, they are slowly losing
its appeal with the younger generation.
In this social media age, any concepts will
need to be endorsed with 'likes' by peers
to be properly recognised and accepted.
It is this entrenchment of technology
with everyday usage that requires Advis-
ers 2.0 to embrace technological advance-
ment. Advisers 2.0 will need to follow
proven trends to adopt the best-of-breed
technological solutions into their advisory
business. For some, tapping into the social
media platform to promote their services
will become a common approach. For oth-
ers, storage of client correspondence and
information via cloud computing will
soon become a default. The potential use
of technology is limitless.
At iGP, we have recently launched an
iPad application to allow Advisers 2.0 to
gain instant access to latest market and
product information. Known for its intui-
tiveness, the application on an iPad will
allow Advisers 2.0 to present information
in a clear and concise manner to their cli-
ents. For those who would like to effect
transactions immediately, they could use
iGP’s iSign and iPass online modules.
These modules allow the respective use
of digital signature and password to ef-
fect non face-to-face transactions on the
fly. Because of these tools, long-distance
servicing of clients has become a feasible
reality. Advisers 2.0 can rest assured that
iGP will not rest on its laurels and will
continue to invest in technological inno-
vations to help improve the whole advi-
sory flow.
Attributes of Advisers 2.0:
SPRINT
Scalable
Product Savvy
Revenue Wise
Informative
Network Building
Technology Embracing
Conclusion
It is very clear that the attributes of
SPRINTing will be the DNA of the next
generation Advisers 2.0. Those who do
not embrace them will fall out from the
race. iGP
Patrick Ho is Managing Director, iFAST Platform
Services (HK) Ltd.