先锋集团和Charles Schwab于2015年先后进军智能投顾界，在管资金规模分别为830亿美元和190亿美元。Fidelity，美国银行美林证券部（BAC）、TD Ameritrade Holding（AMTD）和E Trade Financial（ETFC）最近也开始了相关项目。而据报道，高盛、摩根大通和摩根斯坦利也都在开发自己的数字投顾平台。这些公司能够利用他们已有的顾客关系，这为他们在吸引资产或是将资产转移至他们的数字平台上时提供了优势。
Schwab机器人投资产品Intelligent Portofolios负责人Tobin McDaniel表示，目前最大的机遇在于转化那些仍在使用自我管理账户的用户。Schwab的自我管理账户中就存有1万亿美元。“机器人投顾对于这些人来说是个更好的解决方案。”
机器人投顾公司FutureAdvisor联合创始人Bo Lu表示：“独立的数字创企在增加人工顾问，业内现有咨询公司在增加软件，最后我们得到的是混合体。”FutureAdvisor创立于2010年，2015年被黑岩收购，Bo Lu仍管理着他的公司。
表现记录一直是个能够惹怒乐天堂娱乐顾问的话题，他们说个性化的投资组合不应与其他账户比较。Schaprio还运营着一个有10亿美元在管资产的乐天堂娱乐顾问公司Condor Capital Wealth Management，在Barron上也有排名。他认为所有乐天堂娱乐顾问都应有某种形式的表现追踪，就像Morningstar追踪共同基金和交易所交易基金那样。
By tech start-up standards, robo-advisors are already approaching middle age. Betterment, the pioneering robo-advisor and still the largest of the independent firms, turned seven in May. It now has $9.1 billion in assets under management.
As a business, it’s a modest success story. Many top-ranked financial advisors have far more in assets. But it’s hard to underestimate the broader impact Betterment has had on financial advice in the U.S.
The firm and its younger rivals have introduced game-changing technology to the wealth management world, similar to Tesla pushing Detroit to embrace electric cars and autonomous driving. Unlike Tesla, though, the robo-advisors haven’t built an entire car from scratch. Robo portfolios are filled with low-cost exchange-traded funds managed by fund giants like Vanguard Group and BlackRock (ticker: BLK). It would be akin to Tesla building the Model S with a Ford motor. Still, the collaboration doesn’t diminish the robos’ trailblazing ways.
“They were a kick in the pants for the industry,” says Kendra Thomson, who runs Accenture’s global wealth management practice and works with some of the largest players in the world of financial advice. “They have innovated on the client experience and proven that there’s demand for advice across all asset classes and all demographics.”
Says Betterment founder and CEO Jon Stein: “For me, one of the most satisfying results of the work we started seven years ago is seeing the entire industry change.”
Vanguard and Charles Schwab (SCHW) joined the robo movement in 2015. Their digital efforts have amassed $83 billion and $19 billion, respectively. Fidelity, Bank of America’s (BAC) Merrill Lynch unit, TD Ameritrade Holding (AMTD), and E*Trade Financial (ETFC) are more recent entrants, and Goldman Sachs Group (GS), JPMorgan Chase (JPM), and Morgan Stanley (MS) are all reportedly working on their own digital offerings.
The existing players are able to leverage their client relationships, which gives them a leg up in recruiting assets, and in some cases shifting assets, to their digital platforms.
“The vast majority of clients already maintain an existing relationship with Vanguard,” says Frank Kolimago, who heads Vanguard’s robolike platform, Personal Advisor Services. “They’re looking to make the relationships a bit broader.”
Tobin McDaniel, who runs Schwab’s Intelligent Portfolios robo product, says the big opportunity lies in converting investors who still use self-directed accounts. Schwab alone, he notes, has $1 trillion in self-directed accounts. “Robo advice is a much better solution for most of those people,” McDaniel says.
Meanwhile, as standalone robos have matured, they have turned to humans for help. In January, Betterment began offering human advice for a higher fee. And last week, the firm turned on a messaging service in which all of its customers can reach out to real advisors for any investing or financial-planning questions, with a response in one business day.
“The digital independent start-ups are adding human advisors, and the existing advisory firms are adding software, and we’re all ending up in the middle,” says Bo Lu, who co-founded robo FutureAdvisor in 2010 and continues to run the business, which was acquired by BlackRock in 2015.
For consumers, the middle is a good place to be: low-cost funds, managed by low-cost advisors.
BETTERMENT’S ORIGINAL robo tier, which now includes the advisor messaging service, charges one-quarter of 1% on invested assets. For a $50,000 investment, that’s $125 a year. For 0.4%, the company now offers unlimited access to human advice; customers can schedule calls as they would at traditional advisory shops.
Vanguard, which forces its digital-advice customers to run changes through a human advisor, charges an annual fee of 0.3% of assets. Traditional fee-based advisors usually charge around 1% of assets—and that’s before the cost of any funds.
The robo revolution wouldn’t have been possible without ETFs, whose fees continue to fall. The funds provide investors with inexpensive exposure to indexes that track stock and bond markets. It’s generally a passive form of investing, meaning investors aren’t picking individual winners and losers and they’re not timing the market.
Vanguard says the ETF fees for its digital portfolio average 10 basis points, or 0.1%. That gives Vanguard’s service an all-in cost of 0.4%, a paltry $200 a year for a $50,000 account.
THE PASSAGE OF TIME brings another important ingredient to the robos: performance history. For the first time, most of the robos now have a track record that’s a year or more. And Barron’s has a comprehensive look at how they’re doing, thanks to groundbreaking data from BackendBenchmarking, a Martinsville, N.J.–based analytics firm.
Backend began publishing its “Robo Report” in October 2016. Its latest quarterly report will be released to subscribers this week (the subscription is free at backendbenchmarking.com), but Barron’s got an exclusive first look.
Over the past year, Schwab’s Intelligent Portfolios robo has been the top performer, by a narrow margin. Its portfolio gained 11.94%, edging out Betterment (11.68%) and E*Trade (11.60%).
Robos are building long-term portfolios, so one-year performance is an incomplete picture. But it begins to give a basis for comparison. Perhaps, more importantly, Backend’s data is opening a window into how the robos craft their portfolios and how their decisions affect returns. (See the table above and the sidebar for details.)
In order to track the robos’ otherwise opaque performance numbers, the research outfit opened and funded accounts at 16 different robo-advisors. It answered the robos’ risk surveys with the aim of creating a portfolio that consisted of 60% equities and 40% bonds, a time-tested approach for moderate and somewhat risk-averse investing. (The firm separately opened retirement accounts with more-aggressive allocations.)
“It started out as an experiment in the garage,” says Ken Schapiro, publisher of BackendBenchmarking. “All this money is going into these robo investments, but there was no track record. It’s a black box.”
PERFORMANCE HAS ALWAYS BEEN a touchy issue with financial advisors, who argue that customized portfolios shouldn’t be compared with other accounts. Schapiro, who also runs Condor Capital Wealth Management, a Barron’s-ranked advisor with almost $1 billion in assets, thinks all advisors should have some form of performance tracking, along the lines of what Morningstar does for mutual funds and ETFs.
Sure enough, the robo firms haven’t always celebrated Backend’s efforts. Vanguard asked to be removed from the report, and it pulled one of Backend’s accounts from its automated platform. Backend immediately picked up coverage from a backup account. The firm says it’s committed to being an independent source of data, and it’s not asking for permission to track the robos.
The company also faced some early backlash from Wealthfront, which felt that Backend had unfairly calculated its performance. Wealthfront was removed from the report soon after. Backend corrected the issue, which came in one of its first reports, and calls the experience a “growing pain.” Wealthfront has been added back to the latest report.
Betterment points out that BackendBenchmarking’s report doesn’t pick up the nuances in an advisory relationship—tax-advantaged decision making, for instance. The nuances are what Vanguard calls “advisor alpha”—which it calculates can add about 3% to the returns of advisor-managed portfolios.
Schapiro isn’t claiming that Backend’s performance numbers should be the only factor in choosing a robo-advisor: “I would say: Use it as a guideline.”