Clarence Chan, Singapore CEO and Head of Client Solutions, Asia Pacific ex-Japan at BNY Investments, brought his extensive regional experience and strategic insight to the panel discussion titled “Mastering Investment Advisory: Strategies for Differentiation and Innovation in Wealth Management,” held at the Hubbis Philippines Wealth Management Forum in Manila on March 19. His remarks underscored a critical shift in the wealth management landscape, one that demands a rethinking of how advisors engage with clients in an era of persistent volatility and evolving expectations.
Chan began by addressing the elephant in the room: volatility. “Volatility is the only constant,” he asserted, noting that political, economic, and technological shocks have become the new normal. This structural volatility, he argued, is not a cause for alarm but an opportunity for advisors to engage more deeply with clients. “It’s not about the next hot fund or the highest yield,” he said. “It’s about building portfolios that are resilient, balanced, and aligned to risk tolerance.” This shift from exuberant risk-taking to cautious hesitation reflects a broader psychological change among investors, moving from FOMO (fear of missing out) to plain old fear. Clients are now more focused on capital preservation and stability, a sentiment that advisors must acknowledge and address.
Chan highlighted how BNY Investments is working closely with advisors to realign client expectations around achievable outcomes and risk-adjusted returns. He pointed to fixed income as an example, noting that stable income and total return in fixed income might be the better trade right now. “If you can get stable income and total return in fixed income, that might be the better trade right now,” he stated. Bonds, once overlooked, are now receiving more attention due to the new rate environment and their potential role in stabilising portfolios. Chan emphasized the importance of helping clients adopt a mindset that acknowledges volatility without overreacting to it. “It’s not about the next hot fund or the highest yield,” he noted. “It’s about building portfolios that are resilient, balanced, and aligned to risk tolerance.”
Chan offered an inside look at BNY’s investment framework, explaining how the firm refreshes its capital market assumptions (CMAs) annually to recalibrate strategic asset allocation (SAA) models. These updates are data-driven, powered increasingly by machine learning models that test scenarios and stress conditions to improve accuracy. Technology, he asserted, is not just a support tool but a critical enabler of efficiency and precision. BNY Investments’ OCIO (Outsourced CIO) business uses digital capabilities to ensure the implementation of the asset allocation is as efficient as the design itself. “It’s not just about asset classes—it’s about choosing the most cost-effective and efficient way to express that view,” he said. ETFs and mutual funds are selected based on liquidity, cost, structure, and tracking accuracy, often with automated screening tools. He was particularly enthusiastic about the use of ETFs in tactical allocation. “They’re easy to use, liquid, and efficient for expressing near-term views,” he noted. In a market where speed and flexibility are crucial, ETFs allow wealth managers to fine-tune exposure without needing to disrupt the core allocation.
As portfolios become more complex, Chan argued that client communication must become more deliberate and nuanced. He explained that clients now expect not just recommendations, but well-articulated rationales. “It’s not enough to send a fact sheet,” he said. “You need to articulate why a particular view matters, what it means for their portfolio, and what action, if any, should be taken.” He stressed that private clients are not necessarily looking for precision in prediction, but for clarity in perspective. Advisors, he said, need to act as translators—turning macro uncertainty into individual strategy. “Volatility should be framed as opportunity, not panic,” he advised. “That requires communication that is regular, relevant, and responsive.” He also touched on behavioural coaching—helping clients understand when to act and when to stay put. “Clients need to accept that yesterday’s winners might not be tomorrow’s leaders,” he said. This means normalising portfolio rebalancing, making sector rotations less emotional, and embedding flexibility into portfolio reviews.
Chan also highlighted the growing role of digitisation in portfolio construction, especially within the OCIO offering. He explained how BNY is integrating data science and machine learning into their operational backbone. “Machine learning allows us to process vast datasets and identify better implementation paths,” he explained. This includes not only macro forecasting but also security selection. “Say you want large-cap US equity exposure,” he said. “We run filters to compare ETFs, funds, and other instruments based on tracking difference, cost, style exposure, and more.” Technology, in this case, becomes a way to industrialise consistency without diluting the