The Update to the Report on the IOSCO Automated Advice Tools Survey indicates that the market for automated investment advice has developed rapidly since IOSCO published in 2014 a survey report on the use of these tools by intermediaries and retail investors. The updated report concludes that the continued development of automated investment advice tools requires ongoing monitoring to help regulators understand its impact on the provision of investment advice to retail clients.

Use of automated advice tools is expanding as intermediaries seek to provide advice in a more efficient and cost-effective manner. A growing number of retail investors, whether by preference or because they consider the services of traditional intermediaries too expensive or extensive for their needs, also prefer to manage their own portfolios using online tools. At the same time, the functionalities and analytics provided by automated advice tools are growing in range and sophistication, while the regulation of internet-based technology continues to evolve.

Given the rapid growth and evolution of the market, IOSCO conducted a second survey of its members in 2016 to update its earlier findings on automated advice tools. IOSCO members responded to questions regarding, inter alia, the growth, use, regulation, and supervision of these tools in their jurisdictions, as well as the regulatory challenges posed by cybercrime, inappropriate advice, changing demographics and other similar developments.

The update report includes a summary of responses to the survey questions and an overview of the regulatory measures and guidance adopted by some survey respondents.