New research has found that majority of investors would use AI-powered digital assistants to help them understand how their investments are performing as 8 out of 10 currently disregard “overwhelming and confusing” investment fund performance reports
Today, The Investing and Saving Alliance (TISA) has released new research which has found that introducing an AI-powered digital assistant could increase engagement and understanding of investment performance:
- 3 in 5 say they would use AI-powered tools which provide educational content.
- Over 90% of investors felt that an AI-powered digital assistant would improve their understanding of how their investment is performing. This increased to 95% amongst Gen Z.
- 89% of investors said that using an AI-powered digital assistant would improve their confidence in investing.
The research also found that the performance information relating to investments, contained in Fund Performance Reports, is not being considered by 8 out of 10 investors. Just 1 in 5 use these performance reports to inform their investment decisions. This figure falls to just 1 in 10 amongst less confident investors. Furthermore, 1 in 3 less confident investors struggle to use this information to decide whether to make changes to their investments.
The research was conducted in conjunction with Vanguard, Life Moments and EY Seren, and also found that:
- When reading a Performance Disclosure:
- 1 in 4 less confident investors struggled to understand key financial terms.
- 1 in 3 less confident investors struggled to understand performance metrics.
- 1 in 4 less confident investors struggled to understand relative performance.
- When asked about the challenges they faced when reviewing Performance Disclosures:
- Women were more likely to report challenges when reviewing performance disclosures, with nearly 85% facing challenges compared to 75% of men.
- Investors from an ethnic minority background were more likely to face challenges when reviewing performance disclosures, with 94% stating they faced challenges.
- When making investment decisions:
- Investors were more likely to turn to family and friends (47%), information sites such as MoneySavingExpert (46%), TV programmes about money (19%) and social media or influencers (14%) than Performance Disclosures (12%).
- Women (7%) were far less likely than men (18%) to turn to Performance Disclosures when making investment decisions. Instead, over half of women refer family and friends about investment decisions.
The research also looked at how the design of investment performance reports could be improved for all investors and found that simple educational content and benchmarking features support financial decision-making by making it easier for investors of all confidence levels to understand how their investments are performing. Additionally, innovation in AI by financial service firms could increase consumer engagement and understanding of how their investments are performing.
The research highlighted how prevalent AI-powered tools have become, with the majority of consumers using them. Those who did not feel comfortable using AI-powered tools raised concerns around the quality of outputs and trust issues.
Commenting on the research, Carol Knight, Chief Executive at TISA said:
“This research reveals the potential of AI to improve investors’ understanding of investment performance reports, which many find overwhelming and confusing. Quarterly performance information is provided at great cost by financial services companies and, in its current form, does not support most investors’ decision-making, no matter their confidence level.
By delivering instant, tailored insights, AI eliminates the need to search manually for answers and the long wait times for customer support, making it easier for investors to understand information about their investments. The research shows that, regardless of age or investing experience, AI can empower all consumers by providing clarity about how their investment is performing.
Financial Services firms should consider how they can integrate AI into their service offerings to help increase customer engagement, understanding and confidence.”
Regulation requires financial services firms to create and provide quarterly fund performance reports. These reports are supposed to help people understand how their investments are performing, assist investment decisions and allow investors to track progress toward financial goals.
Commenting on the research, Sophie Legrand-Green, Policy Executive at TISA, also said:
“AI has the power to revolutionise how investors can interact with investment performance information created by financial services firms. Our findings show that people are already beginning to turn to AI tools, such as Chat GPT, to support their investment decisions, which raises concerns around the ability of financial services firms to use AI to provide trusted sources of reliable information. The current unlevel playing field risks potentially unreliable, unregulated AI tools filling the advice gap, leading to poor consumer outcomes and undermining the UK financial services industry.
By reimagining how we present information, we can make it easy for investors to interact with performance disclosures in a way that increases their confidence and knowledge. AI can materially move the dial. To harness this opportunity, the FCA should work with the industry to identify and overcome the regulatory barriers that are stifling innovation in this area, and we look forward to working with both to ensure a level playing field that enhances consumer engagement, understanding and decision making.”
Liz Waldron, Head of UK Personal Investor Client Experience & Digital, Vanguard, said:
“Fear and friction often prevent people from investing. As an industry, we need to build confidence and guide people toward long-term investment success. We’ve seen that once someone decides to start investing, they can quickly feel overwhelmed by the fund choices and information put in front of them, leading to decision paralysis. TISA research highlights the urgent need for clearer, more accessible information to help people make informed choices. By simplifying fund information and making comparisons easier—using advanced technology—we can break down these barriers and empower more people to take control of their financial futures. Let’s make investing accessible and understandable for everyone.”
Theresa Clifford, Director, Financial Services, EY Seren said:
“The investment landscape can be daunting for many people, often leading to a lack of confidence and engagement. As our research shows, currently, Investment Fund Performance Reports are complex, inaccessible, disengaging and not actionable. We want to change that. When done right, Investment Fund Performance Reports can be a force for financial inclusion.”
Peter Neufeld, Partner at EY & EY Seren said:
“Investment Fund Performance Reports provide the biggest opportunity for commercial advantage. Done properly, Investment Fund Performance Reports bring a wealth of benefits to the end customer, building knowledge, informing decision-making, fostering transparency, supporting financial goals and ultimately, furthering inclusion. As our research shows, leveraging AI in Investment Fund Performance Reports can help to foster a more inclusive investment environment where more people can grow their wealth and achieve financial stability.”
Ben Leonard, CEO of Life Moments, said:
“Through this research we have proven that small changes can create a big consumer impact. We have also shown that consumers are now living in a world of Digital Assistants and these provide a significant uplift in financial inclusion. We must design solutions for the consumer behaviour of tomorrow so to deliver performance disclosures that boost engagement, understanding, and confidence over the medium term we strongly urge industry and the regulator to embrace some of the more innovative features developed here.”