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Navigating the Future of Investing: Customisation offers choices, but personalisation ensures those choices fit the investor perfectly

Navigating the Future of Investing

In the rapidly evolving landscape of investment, the distinction between customization and personalisation has never been more critical. As the traditional model of productised investing sees diminishing margins, the spotlight turns towards more tailored investing propositions. This shift is not merely a trend but a response to the growing demand for investment solutions that resonate on a personal level with individual investors, and the level of fees that they are prepared to pay for such.

The Era of the Individual Investor

At the heart of this transformation is the recognition that every investor is, in essence, their own ‘fund’. This perspective acknowledges that while investors may share some common attributes, the path, and timing to achieving each investors outcome is highly individualised. The use of investment funds will invariably differ, as each investor’s requirements for cash, their investment objectives, and the timing of their investments are unique.

The Core of Investment Portfolios

With the rise of low-cost indexing and model portfolios, the ‘core’ approach of many investment portfolios has become standardised. However, differentiation and added value now lie in the decisions surrounding what to invest in, what not to invest in, when to invest, when to sell, and when to review and adjust or rebalance portfolios when using model portfolios. These choices are pivotal in creating a bespoke investment experience that aligns with the individual’s financial goals and life circumstances. The idea that there is one time and one way of reviewing and rebalancing portfolios sounds like a proposition of an operationally constrained business rather than one that puts the client first.

The Power of Tax-Smart Investing

In addition to accommodating investor preferences as to their investment universe, statistics and models suggest that tax-smart rebalancing when using model portfolios can enhance post-tax returns by as much as 25%. This significant potential uplift highlights the importance of not only seeking returns but also ensuring compliance with mandates, tax preferences and individual values. Customisation plays a role in setting investments within or outside the predefined investment universe, but true personalisation requires a deeper level of consideration.

Beyond Customisation: The Need for Personalisation

Personalisation in investing goes beyond offering choices. It involves a meticulous adaptation to the investor’s real-life cash flows, aligning investment decisions not just with immediate needs but with long-term goals. Whether it’s about accumulation or decumulation, personalisation ensures that every decision is made in the context of the investor’s unique financial landscape, including the tax implications of capital gains. In many cases there is little point rebalancing a portfolio that generates minor ‘sells’  should the investments only be bought back when the investor puts some cash in very soon after.

The Role of Technology in Personalised Investing

The engines that drive personalised investing must be as nuanced and adaptable as the investors they serve. These systems need to understand the individual parameters that define each investor’s goals and circumstances, much like the parameters that feed the algorithms of generative AI. The quality of personalisation is directly dependent on the precision of the use of these parameters (ie  the investor-centric sophistication of the investment mandate profile) and associated rebalancing engines.

With regulators placing onus and increasing obligations on professionals to deliver the best outcomes for their clients, they must consider whether rebalancing approaches and systems that they use have moved on from ‘one size fits all’ methods from a product era, and consider now what is fit for this purpose for the client centric era.


The future of investing is unequivocally moving towards a more personalised approach. As investors seek solutions that resonate with their unique circumstances and aspirations, the industry must respond with innovative, adaptable, and intelligent systems. Customisation offers choices, but personalisation ensures those choices fit the investor perfectly. In this new era, the success of investment strategies will be measured not just by returns, but by how well they reflect the individual needs and values of each investor.

For those seeking solutions on how to deliver personalised investing at scale, reach out to us at Financial Simplicity.

Stuart Holdsworth

Author Stuart Holdsworth

Stuart has over 30 years of experience in the use of technology for the strategic competitive advantage of businesses in the financial markets and investment industry.

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