Fintech business FinoComp has formed a 'complex algorithms team' to analyse data across the financial advice sector to help firms understand their clients and their behaviours better.
The team - dubbed ‘FinCATs' - comprises five "deep mathematicians", three of whom are new hires, who will look at the client data of financial advice firms and platforms. The firm said both types of businesses could use its FinCATs service to analyse their client data for a number of purposes.
FinoComp CEO Ray Tubman said platforms, for example, had the biggest sets of data and so, if they were to use the service, they could then assist advisers with the data analysis to help them further understand client behaviours.
"It is that sort of evaluated service that platforms compete on," he said. "That sort of thing is the next stage. We have all seen the different web tools and everything they offer - but real deep-dive analysis isn't something that is being used at all."
If the FinCATs team were to analyse all of the clients who left a platform or a large advice firm during a particular period, Tubman explained, they could find correlations among a multitude of factors such as age, gender, location, their portfolio size, whether the markets went up or down and so on.
"Then, through statistical analysis of the data," Tubman continued, "we can see if there is any correlations between those factors and the fact somebody has exited - and even consider combinations of factors. This is really heavy-duty processing.
"In effect, what we are trying to come up with is a likelihood score based on past behaviour. The intention behind that is, if we can apply this sort of mathematical modelling to historical cases, then you can identify those clients who are more likely to exit in the coming period and they are the ones you can focus marketing and love on to try and stop them."
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