The investing market is lucrative and everybody some day or another must have given a thought about investing. However, the market is only rewarding for those with a vast amount of experience. Still there is a specific niche, which is evolving rapidly. These are automated investing platforms also known as Robo advisors. Robo advisers are designed to provide financial advice with moderate to minimal human intervention. If you are a beginner to the investing world then you should know about them and the benefits they offer.
What Is The Scope of Robo Advisers?
Robo advisors do not provide financial planning, financial planning provides you with a human adviser who will educate and guide you with your money. On the other hand, Robo advisers are algorithm based digital system that offers investment strategies and portfolios based on General/Moderate portfolio theory. A user can answer a simple survey related to investing and the algorithm can predict what kind of portfolio will be appropriate for the user depending upon the age, risk tolerance, etc.
These automated advisors are good for first-time investors and for those who need more money to invest. These are cost-effective and lesser cost means more money to invest.
What is so good about robo advisers?
- Low Fees: – Professional investment management are widely available however, they are tailoredmostly for wealthy investors. Sometimes these investors only work with accounts, which have more than a million dollar in them. This puts off small investors from participating in investing. They also charge very high fees to manage a portfolio. Here Robo advisors can bring the cost down very efficiently for example Crossbridge can manage the account as small as $1500. It also has a very low fee structure and no hidden fees either.
- Diverse portfolio: – Robo advisers do not have one size fits all portfolio. Depending upon someone’s interest it has been made to serve every individual. They excel at offering users new idea based portfolio from a rather conservative with mild risk to aggression plus which has significant risk.
- Best in the class algorithm:- Many of the robo-advisor’s algorithm relies on a Noble prize winning investment theory. The best investment practices strive to create an investment with huge return and with minimal risk. Robo uses innovative investment portfolio research to guide their products.
- No Emotional attachment: – It is worth noting that robo-advisers take out the emotion from investing. This reduces human interference and can stop decision taken purely based on emotion. An automated process ensures that high priced investments are sold off and regularly purchasing low priced investments.
Crossbridge has a unique connect platform that has wide range portfolios to achieve optimal returns with minimizing the level of risk.
Conclusion
The robo advisory market is in its initial phase of receiving worldwide attention. The newest entrants are offering a sophisticated and cost-effective way for new investors without much hassle. The multi-operational system of a wide range of portfolio for investors according to their risk-taking measures. The future is indeed bright for these robo advisors, as the algorithm will evolve pragmatically.