18 February 2018
visit www.ebaday.com

Investment pros wary of robo-advisor threat

04 May 2016  |  6776 views  |  0 Login

Investment professionals around the world expect robo-advisors to start replacing humans in the mass affluent market, but are far less concerned that computers will oust them from their work with higher net worth clients.

Of 775 investment pros surveyed by global association the CFA Institute, nearly two thirds are familiar with automated financial advice tools, with 16% not familiar at all. Awareness is highest in the Americas, with CFA members in Emea and Apac showing similar levels of familiarity.

Unsurprisingly, 54% of respondents think that asset management is the sector likely to be most affected by robo-advisors, compared to 16% who think it will be banking, 12% securities, and eight per cent insurance.

With most online tools still offering relatively unsophisticated advice based typically on providing a diversified portfolio, the vast majority of those quizzed think that the new technology will have no effect on institutional investors and ultra-high earners. However, 70% think that the tools will have a positive effect on mass affluent investors and 41% think it could even benefit high net worth people.

With this in mind, respondents think the mass affluent are most likely to experience automated tools replacing engagement with humans. Institutional investors and ultra-high net worth investors are not expected to see the same trend because they require complex, tailored advice.

The rise of automated financial advice tools is likely to have a positive cost, access and choice effect for consumers, although respondents are more divided on how quality of service will be impacted.

Nearly half of those quizzed think that the biggest risk associated with robo-advice is that there could be flaws in the algorithms used by providers, while 30% worry about mis-selling and 12% are concerned about privacy and data protection.

Overall, respondents think that robo-advisors will be the technology to have the greatest impact on financial services over the next one and five years, ahead of blockchain tech, crowdfunding and P2P lending.

Read the full report:» Download the document now 405 kb (PDF File)

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Robo-advisor Betterment raises $100m

Robo-advisor Betterment raises $100m

29 March 2016  |  6087 views  |  0 comments | 13 tweets | 7 linkedin
Finra takes a closer look at robo-advisors

Finra takes a closer look at robo-advisors

15 March 2016  |  7100 views  |  0 comments | 7 tweets | 6 linkedin
Robo-advisor MoneyFarm launches in the UK

Robo-advisor MoneyFarm launches in the UK

25 February 2016  |  10711 views  |  0 comments | 10 tweets | 11 linkedin
Iosco steps up focus on blockchain and robo-advisors

Iosco steps up focus on blockchain and robo-advisors

22 February 2016  |  12487 views  |  0 comments | 6 tweets | 9 linkedin
Deutsche Bank launches robo-advisor for online investment platform

Deutsche Bank launches robo-advisor for online investment platform

07 December 2015  |  15653 views  |  1 comments | 34 tweets | 33 linkedin
European regulators take a closer look at robo-advisors

European regulators take a closer look at robo-advisors

04 December 2015  |  9158 views  |  0 comments | 8 tweets | 20 linkedin

Related blogs

Create a blog about this story (membership required)
visit www.ebaday.comVisit www.vasco.comvisit www.swift.com/your-needs/instant-payments

Who is commenting?

Top topics

Most viewed Most shared
Saudi central bank provides sandbox for banks to try out Ripple techSaudi central bank provides sandbox for ba...
10468 views comments | 16 tweets | 11 linkedin
Aussie real-time payments platform goes liveAussie real-time payments platform goes li...
8255 views comments | 15 tweets | 41 linkedin
ECB launches staunch defence of cashECB launches staunch defence of cash
7744 views 10 comments | 21 tweets | 26 linkedin
hands typing furiouslyHow can Blockchain Help with AML KYC
7614 views 3 | 9 tweets | 4 linkedin

Featured job

Competitive base + commission (double OTE)
London, UK

Find your next job