59 connected strategy for asian wealth management ^Top Behavior experiences offer a significant white space and growth opportunity. Their total addressable market is large and growing since most consumers need advice. monetization and benefits A connected strategy is an enabler for new revenue models in wealth management. We first recap current revenue streams and then introduce new revenue models for wealth managers. • Transactional front-end fees: A front-end load is a sales charge applied at the time of the initial purchase of an investment. This is likely the largest component of the Asian wealth revenue pool and remains relatively high. Recently, Hong Kong received a “below average” grade for its mutual fund costs, because of high asset-weighted median fees and the pervasiveness of front-end loads61. More than 85% of funds, whether domiciled or available for sale in Hong Kong charge front loads. • Transactional commissions per trade: A commission is a charge assessed by a broker, advisor or platform for the purchase or sale of securities. For DIY investors with a “respond-to-desire” experience, commissions have fallen to less than 10 basis points per trade in many markets, trending towards zero. • Trailer fees as a per cent of assets under management: Some firms and advisors charge clients a fixed or tiered fee, usually embedded in the product, as a per cent of the AuM. Rising competition and regulatory measures in Asia are challenging trailer fees. For example, Indian regulators have banned wealth managers from charging distribution fees. • Fee-based advice: A fee-based advisor charges an advisory fee from clients in ad- dition to receiving a commission from the firm whose products he sells. Clients in Asia are generally averse to paying for wealth advice and this portion of the revenue pool remains small. • Fee-only advice: A fee-only advisor does not earn any commission from financial products sold. They charge a fixed amount as their advisory fees or a percentage of the client’s AuM or a mixture of both62. Regulators in Asia are moving to shield investors from high fees, with a focus on distri- bution fees, given the industry in Asia is driven by banks, and asset managers have less 61 Morningstar’s biennial Global Investor Experience (GIE) report, 2019 62 https://singaporefinancialplanners.com/blog/fee-based-vs-commission-based-vs-fee-only-financial-advisor/