AI and the future of financial advisors with Q.ai

What

Q.ai is a New Jersey-based AI and quant technology engine that creates investment recommendations across asset classes. Q.ai’s product centers around “investment kits,” through which investors can bundle up to 20 stocks and ETFs; the company’s AI then rebalances the kit’s investments weekly to maximize returns.

Founded in 2017, Q.ai was acquired by Forbes in 2020, where the Q.ai team’s researchers are contributing writers.

Why 

According to Jason Mountford, Trend Analyst at Q.ai, the use of artificial intelligence in the financial advisor space is “an untapped area.” While retail financial advice is a large industry in aggregate, it’s also a cottage industry made up of small businesses that operate using old-school methods. “It's an area that's definitely ripe for some AI innovation, particularly in the operations space,” Mountford said.

How

Mountford anticipates that introducing AI to the financial advisor space will require working with the right internal stakeholders, especially from a compliance perspective. Legal and operations teams will have to be convinced that a more hands-off approach to trades and other outputs—having them be powered by AI instead—is not just efficient or advantageous, but also an opportunity to mitigate human error and boost compliance.

In addition, Mountford thinks that the future of AI and financial advisors will significantly affect the robo-advisory space, and will bring robo-advisors and financial advisors closer together. Current robo-advisors are primarily robo-investment platforms, but don’t fully dive into more textured financial planning around debt levels, cash flow modeling, and targeted goals. Questions like Should you be paying down your mortgage or should you be investing in surplus cash flow? aren’t currently answered by robo-advisors. “I think that gap between the two is where there's the opportunity for fintechs in particular to bring more tie-ins between the actual advice piece and the investment piece,” Mountford said.

But a lot of this operational strategy is about waiting. Younger generations—clients and advisors alike—are more open to technology driving their financial decisions. Acceptance and adoption of AI will be a slow process. It may be especially slow if AI makes entry-level financial-advisor positions obsolete, complicating efforts to bring in new talent to fill the ranks of advisory leadership in the coming decades.