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Capital Markets Outlook 2013: Mobile in a Millennial World

Financial firms must develop cutting-edge mobile apps that will attract ultra-demanding Millennials and institutional clients who want to seamlessly track their portfolios, research stocks and trade on the go.

Why It's Important: Millennials increasingly want to manage their assets online. To retain clients and win new ones, financial firms must invest in attractive online and mobile features. A recent report from Aite Group, a research and consulting firm, showed that one-third of young affluent or high-income investors have shifted their assets when they found another provider had better online tools. Such shifts are partly because of the massive popularity of smartphones and tablets among Gen Yers: Among those surveyed, nearly all owned smartphones, and 40 percent owned a tablet.

Where the Industry Is Now: Two years ago, the BlackBerry was king of Wall Street. Today, financial executives have dumped Research In Motion's device in favor of Apple's iPhone and, to a lesser degree, Android smartphones. With BlackBerry's stunning fall from grace, firms are fast-tracking apps for the new iPhone 5, Android devices and the iPad, which has become ubiquitous on Wall Street.

Driven by skyrocketing smartphone adoption rates as well as advances in smartphone and tablet technology, financial software engineers are offering a rapidly growing number of mobile apps, both to retail investors and to Wall Street insiders. Finance pros tend to view mobile apps in terms of convenience rather than as game changers, but most use them on a regular basis, to glance at stock quotes, trade on the run, read research and check out what other traders in their social (media) circles are up to.

Meanwhile, financial firms and mobile app developers are leveling the playing field for retail investors by providing apps that increasingly give them the same information--such as quantitative analytics--as traders and Wall Street executives.

Wall Street firms also are stepping up and launching more apps for their institutional clients. JPMorgan reports that 20 percent of the institutional clients who have used the bank's Web-based applications also have used its mobile apps.

Focus In 2013: Financial firms' mobile focus next year will be on the ability to fully integrate apps with iOS 6. In particular, they'll concentrate on developing applications that leverage Siri, which lets users send messages and make calls with their voice. Leading banks are expected to launch apps that let customers call their adviser and even manage their accounts on their smartphones using voice commands. Firms will also look at further integrating social media and analytics with their apps.

In addition, hybrid applications that integrate Google analytics will make it easier to track what people do with their smartphones and with an app, says Chris Psaltos, VP of product management at Scivantage, which provides web-based, front- and middle-office technology products to the financial industry. To boost communication between clients and firms, vendors also are looking to let clients ask questions directly from a forum embedded in a financial firm's site, as well as launching live chat functions in a mobile app.

[The Top 10 Mobile Apps on Wall Street]

Vendors such as Scivantage also are focusing on enhancing and speeding up the account opening process by taking advantage of the ubiquitous cameras on smartphone devices. Prospective customers can take a picture of their driver's licenses, which are typically needed to open an account, and send them to the brokerage via their mobile device, rather than mailing them in.

Industry Leaders: E*Trade, Fidelity Investments, Goldman Sachs Asset Management, JPMorgan, Morgan Stanley and TD Ameritrade, are among the leading mobile app providers.

Technology Providers: A range of companies offer innovative mobile apps, including Turing Studios, which developed the PortfolioLive app that lets users track their portfolios, research stocks, and manage and trade positions across an unlimited number of portfolios. Visible Market developed the popular StockTouch app; Pyxis Mobile relaunched in early 2012 as Verivo Software; and Chaikin Power Tools offers a stock market smartphone app that leverages a quantitative analytics model to predict whether a stock will outperform or underperform the market in the next six months.

Price Tag: Mobile apps aren't cheap. Costs include investing in staff to develop, support and maintain the app. Development can take up to six months and can cost anywhere from $50,000 to upward of $250,000. Some developers are also looking at HTML5, which lets them develop one app that can recognize the device--computer screen, smartphone or tablet--it's being used on and automatically adjust the display. This should reduce development cost and time, because firms will only have to manage one platform for all devices.

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in April 2007, Melanie lived in Paris, where she worked for the International Herald ... View Full Bio

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