In a market-first for Latin America, Bancolombia Capital will integrate Oxford Risk’s behavioural finance solutions with a focus on its investment products aimed at ensuring clients in Colombia make the most of their investible cash.

Bancolombia Capital will be rolling out Oxford Risk’s unique Behavioural Engagement Technology with its retail clients from the 2nd semester of 2024. Designed to provide Bancolombia Capital’s teams with the deepest possible insights on investor behaviour, Oxford Risk’s client engagement technology will personalise interactions with each investor to improve their decision-making and deliver better financial outcomes.

Oxford Risk estimates that investors lose an average of 300 bps a year in performance due to their need for emotional comfort with investments. Bancolombia Capital will be the first Latin American financial institution to help its clients manage their emotions and mitigate these losses with Oxford Risk’s full Behavioural Engagement Technology suite.

Bancolombia Capital is part of Grupo Bancolombia, which has operations in Colombia, Panama, Guatemala, and El Salvador with financial and non-financial services, and USA with its Broker Dealer and Register Investment Advisor in Miami, serves more than 30 million customers, and is listed on the Colombian Stock Exchange as well as in the New York Stock Exchange.

This partnership is London-based Oxford Risk’s first major client in South America as it continues its rapid global expansion. Last year the value of assets partly managed through its platform increased by 20% rising from around £1,000 billion to £1,200 billion. Around 75% of the assets are from UK-based wealth managers, but the company also has clients in Europe, the Middle East, Japan, and the U.S.

Dr Greg B Davies, Head of Behavioural Finance, Oxford Risk said: “I’m hugely excited about the opportunity to work with Bancolombia’s Behavioural Science team to embed our solutions in the core offering for their retail investor clients. Investors lose on average 300 bps a year in performance due to their need for emotional comfort. Financial institutions have struggled to address this problem, but together with Bancolombia we look forward to systematically applying behavioural finance at scale on behalf of individual clients.”

James Pereira-Stubbs, Chief Client Officer, Oxford Risk added: “We are proud to work with Bancolombia. Not only is this our first major client in South America, but it is also a leader in applying new technology and research to develop world-beating propositions for clients. Together with the Bancolombia team we will further develop our core investment offering and demonstrate the power of behavioural finance-driven propositions”

Oxford Risk, which builds technology to help wealth managers, pension funds, and other financial services companies assist their clients in making the best financial decisions in the face of complexity, uncertainty, and behavioural biases, has developed proprietary assessments and algorithms which rank products, communications, and interventions for investors at a particular time.

It believes the best solution for each investor needs to be anchored on a holistic view combining stable and accurate measures of risk tolerance, an understanding of their overall financial circumstances, and knowledge and experience.