Does Robo-Advising Fit into Your Financial Practice?

By Christina Flemming



Even if you don’t know a lot about robo-advising, you’ve likely heard mention of SmartFolio by BMO. According to the FAQ section on their website, BMO says SmartFolio is, “an online portfolio management service for clients looking for an affordable investment solution…The SmartFolio portfolio management team is comprised of 12 professionals who collectively manage over $20 billion in Assets Under Management (AUM).”

SmartFolio is likely viewed as a more trustworthy robo-platform because it’s associated with BMO. Canadians are interested in robo-advising, according to a 2016 Canada Consumer Digital Banking Survey commissioned by Accenture. According to the survey, 43 per cent are willing to bank using automated recommendations, 70 per cent want digital advice on planning for retirement, and 77 per cent want automated investment advice.

If Canadians are interested in this kind of service from their banks, advisors who want to adapt will have to consider whether robo-advising could fit into their practices.

Nest Wealth Management, based in Toronto, launched a platform available for individual advisors or entire firms. Basically, companies register via a digital onboarding process. This stage is designed to capture know-your-client information and gauge their risk tolerance. From there, investors can set goals and monitor their accounts from this online portal. Advisors are able to keep track of these client accounts, receiving notifications if clients stray from their goals.

Wealthsimple Financial also launched an advisor platform in May 2016. They advertise this platform as “a radically better way to manage your client’s passive portfolios.” Similar to Nest Wealth’s platform, services include a dashboard to allow advisors to monitor clients’ portfolios and personalized dashboards each client will have access to –  both on the web and with their mobile app.

Other robo-advising platforms are still in the process of developing services for advisors. At this stage, only time will tell us whether automated investment advice will become the norm or not. Either way, it is certainly a trend that investors are beginning to pay attention to.

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