Lisa Shidler

The opposition of brokerage firms to embrace electronic means to advance excellence in advisory services is self defeating. Schwab has found it is in their enlightened best interest and that of its RIA user base to embrace innovation and the marketplace agrees. A good shopper asks what am I getting in return for the fees, commissions and administration cost I am incurring. The extraordinary range of investment and administrative values which are addressed and managed electronically in “robo advice” greatly exceed the capabilities of brokers at a far lower cost. The brokerage industry might want to reconsider the acknowledgement and support of advisory services and the professional standing of the broker, who is not allowed (by compliance protocol) to render advice. It is indisputable the brokerage lobby has denied the “retail investor” the same consumer protections accorded to all other investors.

Schwab is out executing the “retail” brokerage business, market share will follow..

SCW Stephen Winks

Schwab's robo spikes suddenly to nearer $5 billion as 500 RIAs sign on

Walt Bettinger: We saw new enrollments spike as the market fell.

Silver Lane Advisors

Betterment Institutional

Schwab Intelligent Portfolios

Walt Bettinger

Joe Ziemer

Peter Nesvold

Stripped down to its essentials, financial advice is a fairly straightforward proposition. Done well, a highly ethical individual stewards the assets and actions of an investor in a personal and professional interchange.
 
But now a vibrant new class of entrepreneurs is staking their fates and their fortunes on the premise that financial advice can be delivered in a better, cheaper, easier, more ethical, more transparent manner and, as a bonus, in a way more devoid of human annoyance on both ends of the transaction.
 
Cue the robo-advisors, arguably a callous misnomer for automated asset management. 
 
The prototypical robo-advisory entrepreneur has more brands on his or her resume than NASCAR. The bona fides of these industry upstarts often include Ivy-level colleges and MBA programs at Harvard or Stanford. They are often flush with IPO dollars realized at concerns like LinkedIn, Facebook, eBay, Amazon  and Microsoft. 
 
Robo-folk believe that technology is not an enabler of advice but rather, if engineered correctly, advice itself in digital form. 
 
And, they believe the best solutions originate in Silicon Valley or academia, not Wall Street. Robo-entrepreneurs are white-boarding the whole business model, culture and technology from scratch in the conviction that little can be learned from a legacy advice system still rooted in an investment banking culture acting under the core premise that if stockbrokers get rich some of the good effects will trickle down to clients – with the clients none the wiser. 
 
Robo-advisors are a scintillating topic for students of the advice game as they grow by hundreds of millions in assets every month, constantly evolve their business models and receive cash infusions from ever-larger swaths of venture capitals.
 
Throw in the fact that robo-advisors have yet to see a dime in profits -- and won’t in the foreseeable future -- and you have real intrigue. 
 
RIABiz has avidly covered the fast-evolving robo-advice phenomenon and will continue to do so. We present the growing body of articles here.

Robo-Advisors

San Francisco giant also claims the assets, despite being managed for 'free,' produce better revenues than the self-directed accounts they are cannibalized from

Schwab's robo spikes suddenly to nearer $5 billion as 500 RIAs sign on

Stephen Winks

Related Moves

July 24, 2019 at 12:53 AM

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