The arguments about robo-advice have been spinning around for a while now. What is really going to happen to the traditional IFA industry? Will robots replace humans? According to the chief executive of digital investment manager Moo.la, Gemma Godfrey, robo-advisers will not put an end to the traditional IFAs.
Godfrey said that automated
investment services are here to help and collaborate with the advice industry,
referring to Betterment, the largest independent robo-adviser platform in the US,
which recently launched a tool for advisers. Technology can only help advisers
to provide better customer service and to make loss-making clients into
profitable ones.
Meanwhile, Shaun Port, chief
investment officer of the UK’s most popular robo-adviser, Nutmeg, stated that the
online investment platform presented the use of fractional share dealing in
exchange traded funds (ETFs) earlier this year. Fractional shares let investors
buy just a fraction of an ETF unit costing as little as one penny, rather than
a whole share so that they can now build risk-weighted asset allocation into
accounts worth as little as £100.
The new fractional shares dealing
in ETFs will provide digital solutions in terms of who is running money for the
advisers.
There’s no need to be scared of
technology replacing humans in the advisory industry, on the contrary, advisers
should embrace technology and get the best out of it in order to help clients
manage their portfolios and better understand the nature of investment
products.
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