AI Cash Optimization Fears Not Controllable, But Rev Diversification Is

Research evidence excerpt

AI Cash Optimization Fears Not Controllable, But Rev Diversification Is

Workplace a new growth focus: SCHW is currently a top 4 provider in stock plan and top 10 in

retirement and looking to grow that share. While they did not provide goals for how to move these

positions or the proportion of NNA, we have seen MS use workplace as a source of growth in the WM

market. The PIES offering was recently rolled out, which is timely given some of the pending large IPOs.

We also learned that SCHW and Forge are working actively with Anthropic to understand why they were

included with bad actors in secondary trading (link and link), as they only have been involved with SPVs

that Anthropic has approved.

AI integration: Thematically SCHW showcased throughout the presentations where they are employing

AI in both its offering and its operations. The tools flagged struck us as sensible, powerful, and leading,

which seemed to dispute the notion that SCHW is behind on the tech front. Seeing these capabilities

convert into NNA, will be the proof point but the tools and capabilities are encouraging. Of course, the AI

issue central to investors/markets for SCHW is about utilization of cash optimization tools, which is hard

to refute because it is about a future state, but the tools showcased were encouraging and seemed to

confirm to us that SCHW is unlikely to be left behind.

AI/cash monetization more about fear/anxiety than observable facts

• SCHW has no plans to launch its own cash optimizer. The core pushback is that cash optimization

is already available through existing money funds, bonds, CDs, and other alternatives, so the

question is not whether clients can optimize today, but whether AI materially changes the

frequency and scale of that behavior over time.