What is a Robo-Advisor – Robo-Investing?
Intelligent Investing Definition and Lexicon
A robo-advisor is an online wealth management service that provides automated, algorithm-based portfolio management advice without the use human financial planners. Robo-advisors (or robo-advisers) use the same software as traditional advisors, but usually only offer portfolio management and do not get involved in more personal aspects of wealth management, such as taxes and retirement or estate planning.
Robo-advisors are typically low-cost, have low account minimums, and attract younger investors who are more comfortable doing things online. The biggest difference is the distribution channel: previously, investors would have to go through a human financial advisor to get the kind of portfolio management services robo-advisors now offer, and those services would be bundled with additional services.
Robo-advisors are a class of financial adviser that provides portfolio management online with minimal human intervention.
While their exact recommended portfolio allocations may vary, currently all robo-advisors employ algorithms such as Modern portfolio theory that originally served the traditional advisory community, which has used algorithmically-based automated investment solutions (dubbed in the industry as "rebalancing software") to conduct portfolio management since at least 2005.
Legally, the term "financial advisor" applies to any entity giving advice about securities. But most robo-advisors limit themselves to providing portfolio management (i.e. allocating investments among asset classes) without addressing issues such as estate and retirement planning and cash-flow management, which are also the domain of financial planning.
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Reasons for Robo-Investing and financial advisers
+ Clients want it
+ Conditions Are Favorable
+ Greater tax efficiency
+ Lower fees
+ Robo-advisory firms are creating institutional platforms that will improve the economics and expand the client mix of advisory firms
+ Robo-advisory firms are expanding the market for investment advice
+ The robo-competition will drive down custodial costs and raise service levels for advisory firms
+ The technology finally works
- Advisors need more time to prepare
- Investors want to know that their account is in "Good Hands"
- You are just an account number
An introduction to Robo Advisors
Investment Advisory: The rise of the Robots?
, Genève Switzerland, June 2015)
Robo-Adviser / sites / platforms / Notable Robo-Advisors
- Edelman Financial Services
- Financial Guard
- Folio Investing
- Jemstep Portfolio Manager
- Motif Investing
- Motley Fool Wealth Management
- Personal Capital
- Rebalance IRA
- Schwab Intelligent Portfolios
- Target-Date Mutual Funds
- True Wealth
- Vanguard VPAS
- DAB Bank
#Swiss Fintech #SwissFintech #SwissRoboAdvisor #RoboInvesting
- True Wealth AG (Zürich, Schweiz, CHE-489.219.513
- Investomat.ch Cockpit (Glarner Kantonalbank GLKB, Schweiz)
- Leodan (die "erste hybride Privatbank der Schweiz")
- InvestGlass SA - Swiss Robo-Advisor for Financial Professionals
Robo Advisor Deutschland / Germany
- Cashboard - Startup - automatisierte Beratung & Investmentangebot (Augsburger Aktienbank)
- ComDirect - Bank - automatisierte Beratung & Investmentangebot
- Easyfolio - Startup - automatisierte Beratung & Investmentangebot (Mischfonds-ETF)
- Financescout24 - Online-Plattform mit neuem Robo-Advise-Angebot - automatisierte Beratung & Investmentangebot (eBase)
- JustETF - Startup - nur automatisierte Beratung
- Quirion - Bank-Tochter - automatisierte Beratung und Investmentangebot (Quirin Bank)
- Sutor Bank - Bank - automatisierte Beratung und Investmentangebot
- Vaamo - Startup - automatisierte Beratung und Investmentangebot (Frankfurter Fondsbank)