General Finance
Mar 17, 2025
How Retail Brokerage Platforms Are Leveraging Data Reasoning
What is AI-Powered Data Reasoning?
AI-powered data reasoning has immense potential for retail brokerage firms due to its ability to:
Analyze both structured and unstructured datasets
Apply logic to immensely large datasets
Deliver informed decision-making and automation
At Gradient, we refer to data reasoning’s capabilities as “understanding the why behind the what.” These higher-level reasoning capabilities allow it to offer much more value than traditional AI tools.
Solutions like Gradient’s Finance Reasoning Platform can uncover relationships between data points, forecast future trends, and analyze sentiment to produce actionable insights and automate even the most complex workflows, which makes it an ideal solution for retail brokerage platforms.
Streamlining Marketing Content Creation
Data reasoning can play a pivotal role in enhancing marketing efforts while maintaining compliance with regulatory bodies. This includes brainstorming ideas for marketing campaigns, creating content, providing deep insight into campaign analytics, and providing recommended next steps.
Some companies will leverage data reasoning to create marketing content in conjunction with the Research and Product teams to attract top of the funnel customers through targeted marketing campaigns via email, social media, or the web. This automated content creation can streamline operations and reduce the resources typically associated with these activities, which often represent a significant expense.
AI-powered data reasoning can also help generate in-app interactions to spur customer activity and reduce attrition. One common example is identifying “at risk” accounts and automatically taking steps to retain them.
Data Reasoning in Action: SEC-Compliant Marketing
Gradient partnered with a financial institution to develop a custom SEC-compliant workflow to automate the redlining process for marketing materials. This custom compliance marketing workflow had a significant impact on performance and output, resulting in:
60% reduction in review time
96% increase in consistency
30% increase in accuracy
Customer Service and User Experience
Data reasoning can also play a critical role in improving the overall customer journey, helping to increase client activity and reduce churn.
This usually starts with improving the customer onboarding experience by automating the information collection and verification process. Once customers have flowed through the onboarding process, data reasoning can assist with areas like customer education, personalized investment recommendations, and ongoing portfolio rebalancing & tax-loss harvesting.
Many firms will also leverage AI-powered data reasoning to streamline different parts of the brand experience, even for people who aren’t customers yet. For example, data reasoning can automatically respond to inbound inquiries, send outbound messaging to clients to increase activity (e.g. funding accounts and trading), and optimize email requests and call center routing based on customer information and history
Another common use case for data reasoning in customer service is creating virtual assistants or chatbots (both online and in-app) that use natural language processing (NLP) to handle account and trading questions, provide real-time market updates, and execute orders automatically.
Data Reasoning in Action: Triaging Incoming Customer Requests
Gradient helped one firm implement a custom AI-based strategy to enhance triaging for incoming customer requests using the vast amount of unstructured data from customer interactions. This resulted in:
5-10x in productivity
70% reduction in customer support staffing costs
24/7 support for customers
Compliance & Legal
Gradient’s Finance Reasoning Platform has been custom-made for the financial industry and is designed to meet common requirements imposed by the SEC, FINRA, or other regulating bodies. This includes tasks like Know Your Customer (KYC), anti-money laundering (AML), trade surveillance, fraud detection, reporting, and compliance audits.
AI-powered data reasoning excels at monitoring large datasets (whether in the app, email, text, or call center) in search of patterns or trends. This makes it an ideal solution for monitoring suspicious activity, fraud detection, and reducing false positives – all of which improves the customer experience and reduces risk.
Many firms also rely on data reasoning to automate regulatory reporting and “rules management”, which involves automatically updating regulatory changes into documents such as Written Supervisory Procedures (WSPs), account opening forms, client statements, and more.
Data Reasoning in Action: Anti-Money Laundering
Gradient helped a large US bank with 40,000 clients enhance its transaction monitoring processes to detect suspicious activities more efficiently. Using AI to identify potential risks resulted in:
3-4x increase in detected instances
50% decrease in false positives
Portfolio Management & Trading
Among the ways that AI-powered data reasoning can assist brokerage firms with portfolio management and trading are:
Executing client orders
Creating and managing automated portfolios
A key differentiator is that Gradient’s Finance Reasoning Platform can often assist in both of these areas while also reducing the manual workload, increasing accuracy, and reducing costs. This is what one major investment firm experienced after choosing to partner with Gradient.
Data Reasoning in Action: Portfolio Management
Gradient helped an investment firm enhance its portfolio management capabilities by leveraging intelligent data extraction and transformation to maximize efficiency and accuracy. This resulted in:
80% reduction in workload
30% increase in end-to-end accuracy
30% reduction in costs
Operational Efficiency
Brokerage platforms perform a myriad of operational tasks daily, and AI-powered data reasoning can improve many of them.
For example, data reasoning can help streamline processes like cash movement (ACH & sweep), statement generation (for customer documentation), proxy delivery, and the clearing and settlement of trades. Automating these tasks using AI can help reduce operating costs, remove manual bottlenecks, and eliminate data silos across the organization.
Technology & Platform Development
AI-powered data reasoning can play a strategic role in affordably developing and enhancing both online and app-based platforms to improve them over time. This can include initiatives like developing new features over time, managing the ingestion and display of market data, offering real-time news to customers, creating more detailed investment charts, and much more.
Cybersecurity & Customer Privacy
Online retail brokers hold massive amounts of personally identifiable information (PII) including customers’ names, addresses, social security numbers (SSNs), assets, salaries, phone numbers, and more.
As prime targets for hackers, the regulators require DTC brokerages to implement procedures and controls in place to protect their customers’ sensitive information. Data reasoning can help improve many aspects of this process, such as automating regulatory reporting and surveillance to help achieve predictive compliance.
Data Reasoning: Your Solution to Scale
We hope that you’ve found this article valuable when it comes to learning some of the many ways that direct-to-consumer brokerages are leveraging data reasoning. Implementing this technology across your brokerage will undoubtedly help to remove manual bottlenecks, increase efficiencies, and improve the digital experience for your customers.
Interested in learning how a high-performing, cost-effective custom AI system could benefit your business? Contact the Gradient team today to learn more. Thanks for reading!
FAQ
How does data reasoning differ from traditional AI used in finance?
Traditional AI often focuses on pattern recognition and automation, while data reasoning goes further by understanding the why behind the what. This means it can analyze relationships between data points, apply logic to large datasets, and provide deeper insights that drive automation and decision-making.
Is AI-powered data reasoning compliant with financial regulations?
Yes, Gradient’s Finance Reasoning Platform is specifically designed to meet compliance requirements set by regulatory bodies like the SEC and FINRA. It can help automate KYC, AML, trade surveillance, fraud detection, and regulatory reporting to ensure compliance while improving efficiency.
How can direct-to-consumer brokerages get started with AI-powered data reasoning?
Brokerages can begin by identifying key areas where automation and data-driven insights could improve efficiency, such as marketing, customer experience, compliance, operations, or portfolio management. The Gradient team can help assess your needs and develop a custom AI-powered solution to fit your business.
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