What is a Robo-Advisor?

What is a Robo-Advisor?

The term robo-advisor is widely used, but many people remain unsure about what exactly it is. Allow us to explain.

Basically, robo-advisors are digital asset managers, working primarily with ETFs. Their functionality is based on mathematical formulas and a wealth of historical data. And, being non-human, they make decisions without any emotion.

Algorithm-enhanced investment

The result is emotion-free, mathematically sound investment recommendations and decisions. Algorithms help people find a suitable portfolio for their investments, and once the investment is made, the portfolio is managed automatically.

The goal of most robo-advisors is to make asset management accessible to people with low or average assets. They determine how much risk an investor is willing and able to take, and create and manage a portfolio that typically consists of ETFs or actively managed funds.

If an investment does not develop in line with the investor’s expectations, some robo-advisors make adjustments to realign the results. All this happens automatically, without any intervention from the investor.

Meet our favourite robo-advisor

FinMarie redefines digital wealth management with a hybrid model of digital finance and human expertise. With the platform, women can create an overview of their entire assets, as well as access experts for financial coaching. Their goal is to make the world of investment as understandable, profitable and safe as possible — and all this online with a fair and transparent price-performance ratio. FinMarie recently partnered with growney, a robo-advisory platform, to offer a full suite of cutting-edge, technology-driven investment services.

To find out more about investing with FinMarie, visit www.finmarie.com

 

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