Say goodbye to the research analysts. 

The largest financial services firms are launching generative AI applications that could save advisors hundreds of hours of time, create billions of dollars in value for firms, and yes, maybe even take over the role of the team’s favorite junior analyst. JPMorgan Chase is the latest Wall Street bank to unveil artificial intelligence tools aimed at making advisors’ lives easier. Executives of the firm told employees the chatbot, called LLM Suite, can help with writing and summarizing documents, and can be used in place of analysts, according to an internal memo reviewed by the Financial Times.

Head of asset and wealth management Mary Erdoes said in May that every new hire will have extensive AI training, and that the tools are already saving analysts two to four hours of their workdays. CEO Jamie Dimon told investors that AI will reshape every single job on the planet, while president and COO Daniel Pinto said the technology has already produced some $1 billion to $1.5 billion in value for the firm. Now, if it could just pick up the dry cleaning.

Get Onboard

AI tools are quickly hitting the mainstream in wealth management. They’re onboarding clients, helping choose investments, and automating back-office tasks, with the potential to do much more. Last week, Morgan Stanley finished its rollout of Debrief, a software program that sits on an advisor’s desktop, records Zoom calls with clients, and drafts follow-up emails. One financial advisor, cited in a company press release, said the AI assistant freed up a half hour per client meeting. 

“The low-hanging fruit is meeting preparation, note-taking, and documenting the meeting afterward,” said John O’Connell, founder of the wealth management consultancy The Oasis Group. “AI will fundamentally reshape the financial advice industry.”

While tech adoption is a well-documented problem for wealth managers, Morgan Stanley estimates 98% of financial advisory teams are already using the assistant. The combined brokerage house has 17,646 financial advisors and manages $2 trillion in client assets.

Who Cares About Compliance? It’s an impressive start for a technology that could become a prototype for new wealthtech tools and a centerpiece to any advisor’s tech build. According to a survey last year from SmartAsset, almost 6 in 10 advisors are already using AI or are planning to experiment with the technology, specifically ChatGPT. Of the roughly 40% of advisors that aren’t, many aren’t familiar enough with the tools:

• 38% of survey respondents said they are not comfortable using artificial intelligence technologies.
• Compliance issues were also a concern: Another 26% of respondents said AI isn’t permitted by management. 
• In addition, 23% said they have privacy concerns with AI or ChatGPT.

One of the most notable so-called anti-woke companies is bringing its controversial convictions to the wealth management arena. 

Strive Asset Management said last week that it’s launching a new wealth management offering to customers, and announced $30 million in Series B funding led by Cantor Fitzgerald. Strive, which was co-founded by former Republican presidential candidate Vivek Ramaswamy and has roughly $1.5 billion in assets under management, said it’s jumping into the advice business due to increased demand from clients. 

“Many Americans are hungry for an authentic and unapologetic embrace of capitalism, meritocracy, and innovation and that’s what we strive to deliver,” Strive CEO Matt Cole said in a release. 

Get the ESG Outta Here

The popular conservative adage “go woke, go broke,” refers to financial consequences for companies that engage with perceived liberal causes, like climate change prevention or diversity hiring programs. BlackRock, which represents more than $5 trillion in retirement funds, is often catching the ire of conservative lawmakers, who allege the firm prioritizes ESG concerns over investors’ best interests. 

Groups like Strive have emerged as alternatives:

• Strive launched in 2022 with backing from Peter Thiel, Bill Ackman, and current vice president hopeful JD Vance, billing itself as “unapologetically committed to shareholder primacy.”
• Strive cites studies to support its business model like one from the Journal of Accounting Research, whose finding suggests ESG-based investing may diminish returns, and firms that highlight their diversity, equity, and inclusion initiatives often do so to take focus away from poor financial performance.

Anti-woke(ish): You won’t find the phrases “anti-woke” or “anti-ESG” on Strive’s website because, well, it may not be. An analysis from Goods Unite Us, a group that aims to help consumers understand brands’ political ties, found the company’s funds are not too different from ones offered by BlackRock, Vanguard, and State Street. In fact, many of the top corporate holdings in its Growth ETF overwhelmingly support Democratic politicians and PACs. 

The company did not respond to a request for comment.

Goods Unite Us argues Strive’s heavy conservative marketing is just a way to convince investors to agree to higher management fees, a tactic other left-leaning firms allegedly use as well. Strive’s 500 ETF follows essentially the same companies as the ones found on iShare’s Core S&P 500 ETF and Vanguard’s S&P 500 ETF, but has a higher expense ratio. Perhaps counter to its messaging, when everybody was going left, Strive did too.

The burritos will be bigger, and you can take that to the bank.

An investigation from Wells Fargo last month may have helped push Chipotle to finally come to terms with its alleged portion problem. Wells Fargo analyst Zachary Fadem led a team of financial professionals who ordered 75 burrito bowls from eight NYC locations to determine if the Mexican grill truly was scrimping on chicken. The team found that inconsistency varied widely between stores, according to Barron’s. 

Then, in its latest earnings call last week, the California-based chain said it found 10% to 15% of its stores were receiving a disproportionate amount of complaints about portion sizes. The company said it will spend an extra $50 million on training to ensure workers serve “correct and generous” amounts. 

“We’re telling our teams: ‘Listen, we don’t want you to be skimping on portions,’” Chief Financial Officer Jack Hartung said during the call. “If you’re not sure whether to go a little more or a little less, go a little more.” 

Shrinking Returns

In an era of high rates, food costs, labor costs, and well, everything else, Chipotle was one of the few thriving restaurants still able to offer higher-priced items, while competitors like McDonald’s, Wendy’s, and Burger King scrambled to put out $5 value meals. 

Toward the end of June, Chipotle was the only food chain among the top 20 performing stocks on the S&P 500 this year. As of last week, however, it had fallen to the 199 spot. Year-to-date returns have shrunk to 11% after hitting a high point of about 52% on June 18.

Where’s the Beef? The debate over size started after social media users called the brand out for shrinkflation in recent weeks. Users posted hundreds of videos of skimpy-looking burrito bowls that were supposed to include two hearty scoops of rice and four ounces of meat. According to Barron’s, the Wells Fargo investigation also found:

• The largest bowl on record was 26.8 ounces while the smallest was 13.8 ounces. The median size across all stores was 21.4 ounces. 
• The analysis found that location was the biggest determining factor. The median bowl size at one store was 23.5 ounces while the median bowl size at another store was just 17.7 ounces. 
• To avoid extra variables, every order was the same: consisting of rice, black beans, chicken, pico de gallo, cheese, and lettuce. 

A well-deserved thank you to all the Wells Fargo analysts who may have needed an after-lunch burrito nap during the making of this research.