Intelligenza Artificiale 9 (2015) 89–103 DOI 10.3233/IA-150079 IOS Press 89 A framework for Personalized Wealth Management exploiting Case-Based Recommender Systems Cataldo Musto ∗ , Giovanni Semeraro, Marco de Gemmis and Pasquale Lops Dipartimento di Informatica, Universita’ degli Studi di Bari “Aldo Moro”, Bari, Italy Abstract. Wealth Management is a business model operated by banks and brokers, that offers a broad range of investment services to individual clients, in order to help them reach their investment objectives. Wealth management services include investment advisory, subscription of mandates, sales of financial products, collection of investment orders by clients. Due to the complexity of the task, which largely requires a deep knowledge of the financial domain, a recend trend in the area is to exploit recommendation technologies to support financial advisors and to improve the effectiveness of the process. This paper proposes a framework to support financial advisors in the task of providing clients with personalized investment strategies. Our methodology is based on the exploitation of case-based reasoning. A prototype version of the platform has been adopted to generate personalized portfolios, and the performance of the framework shows that the yield obtained by recommended portfolios overcomes that of portfolios proposed by human advisors in most experimental settings. Keywords: Recommender systems, case-based reasoning, personalization, investment portfolios, finance 1. Background and motivations A recent trend for financial services firms is to pro- vide clients with investment services tailored on their needs, preferences and desires, as personalized portfo- lios or diversified investment strategies. This process is driven by a precise clients’ segmenta- tion, which is defined on the ground of clients’ features, as their risk profile or their investment horizon. Cur- rently, the market for individual clients is segmented in four categories, among which the most relevant is High Net Worth Individuals (HNWI), with available wealth of over USD 1 mln. The emerging segments are Afflu- ent/Mass affluent (wealth between USD 100K and 1 mln) and High-end retail (USD 10K-100K). Clearly, HNWI and ultra high net worth (UHNW) individu- als are treated differently, with different products and services proposed to meet their needs. ∗ Corresponding author: Cataldo Musto, Dipartimento di Infor- matica, Universita’ degli Studi di Bari “Aldo Moro”, Bari, Italy. Tel./Fax: +39 080 5442497; E-mail: cataldo.musto@uniba.it. The idea of treating different clients’ needs with dif- ferent investment proposals is not totally new, but this trend has been speeded up by some important changes in both financial and technological domains. On the one hand, the spread of such investment services has been further pushed by the 2008 financial crisis, since they are profitable but do not involve credit risk nor stress banks capital requirements. Moreover, investors as well as their assets are further protected by the recent regu- lations which have been estabilished, such as MiFID 1 or Retail Distributions Review (RDR) 2 . At the same time, the wealth management sector has been revolutionized by the technology trends subsumed under the term Digitization [4]. Indeed, online advice sites, sometimes called “robo-advisors”, recently spread and let clients get advice online, anytime at a lower cost [1]. The effects of digitization include reduction of the number of physical branches and the transition 1 http://en.wikipedia.org/wiki/Markets in Financial Instruments Directive 2 http://www.fsa.gov.uk/rdr 1724-8035/15/$35.00 © 2015 – IOS Press and the authors. All rights reserved