(This article has been corrected to delete unnecessary text in the sixth paragraph).

Abu Dhabi-based Falcon Capital Group has announced that it has taken a stake in a London-based wealth management firm that uses robo-advisory models to allow Gulf investors access to low-cost, automated funds. It also offers access to investment funds provided by Hargreaves Landsdown, which typically target high net-worth investors.

In a press release issued on Sunday evening, Falcon Capital said that it has purchased of a 20 percent stake in Gulf Wealth Management - a firm set up three years ago via crowdfunding platform Seedrs with the aim of targeting Gulf investors.

Gulf Wealth Management is set to use the investment to launch operations in the United Arab Emirates and in Bahrain by the first quarter of next year. George Robb, the non-executive chairman of Gulf Wealth Management and CEO of Aberdeen Asset Management in the United Kingdom said the investment by Falcon Capital would also "enable GWM to apply for regulatory approval with a view to a business launch early in 2019”.

He said that the firm would look to work with existing Gulf Cooperation Council (GCC) banks, insurance firms and brokers to secure clients "rather than disrupting their business" by providing a jointly-branded service that would give them more bargaining power when dealing with international asset managers.

Falcon Capital made the investment through its GCC Fintech Fund. CEO Ashar Nazim said its affluent investors in the Gulf region currently have "far more limited investment options available compared to counterparts in the UK or the USA".

Sarwa, a company that recently graduated from the first wave of Dubai International Financial Centre's Fintech Hive, has already received an Innovation Testing Licence (ITL) from the Dubai Financial Services Authority (DFSA), and the DFSA announced in May that MarketsFlow, a company offering "intelligent robo-advisor" services using artificial intelligence, was one of six new companies to be granted an ITL.


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(Writing by Michael Fahy; Editing by Shane McGinley)

(michael.fahy@thomsonreuters.com)

 

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