What is a Robo Advisor? Robo Advice, also known as digital advice, is an automated online investment advice service that navigates investors through a risk profiling questionnaire leading to an algorithm-based portfolio recommendation.
Rutherford Online is proud to introduce our own brand of robo-advice which has been developed by Investec Asset Management and is hosted on their platform.
By answering a few simple questions online, such as what you are saving for (retirement, holiday, just saving); how much you would like to save and for how long; your age; what your income is and whether you have other investments or savings, your computer-generated risk profile, based on these quantifiable factors, will inform the advice given regarding the optimal choice of investment product and fund to meet your investment goals within your risk parameters.
Rutherford Online investments is a unique client-advisor service bringing together the best of human and robo-advice capabilities by offering backup from ‘human’ financial advisors who can be contacted by email or an option to call functionality. Rutherford Online Funds Rutherford’s multi-funds provide effective active fund management of a portfolio of select elite South African fund managers. Multi-funds are strategically significant because it is rare that all funds perform equally in varying market conditions. Another key benefit of a multi-managed fund is the extra level of diversification that is achieved by blending complementary management philosophies. With 5 expertly managed multi-funds with proven track records to choose from, available in either a unit trust or a tax-free savings account, there is an investment ‘fit’ for every investor. Retirement annuities will also be launching soon. The Pros and Cons of Robo-Advice With the massive leaps in technology that take place every year, no one doubts that digital advice will one day become a force to be reckoned with.
Self-service online investing presents investors with an interesting value for money proposition and can save up to 70% of investment costs in some cases. Rutherford Online in partnership with Investec Asset Management will charge 0,5% of your total assets under management per annum. Other aspects of the robo-advice experience that clients prefer over traditional approaches are the convenience of being able to transact anytime, anywhere, and the privacy offered by a digital solution, as well as the ability to learn and chart their own path, which is particularly empowering.
In coming years emerging technologies, such as cognitive computing, are likely to power major advances in robo-advice capabilities. We anticipate being able to interact with the digital assistant and engage in ongoing multi-step advice processes rather than a once-off session. This will serve clients increasingly effectively. As we stand, however, robo-advice has only gained a tiny share of assets under management worldwide and not surprisingly, it has found greatest appeal among the millennial generation rather than older more established investors. Since millennials are still too young to have become major players on the investment scene, we are yet to witness the true potential of digital advisors and online investment services. In addition, we cannot ignore the importance of the human element and the fact that the great majority of investors still prefer the face to face approach. Vital aspects of traditional human intervention, such as reassuring a nervous investor through difficult market cycles, inspiring them to take certain actions and synthesising multiple alternative scenarios are critical to satisfactory investor outcomes. Real people are then likely to remain central to the financial advice function for the foreseeable future, however, given the time pressures that we all face and the logistics of driving to and scheduling appointments around work and other commitments, adopting an integrated approach of both traditional and digital financial advice makes good sense and will add new capabilities to the wealth management arena. How can Rutherford Online be of service to you? Online investing is a great place to start for a first-time investor, and you’re never too young to start investing for your future. It’s also an excellent learning environment as it prompts the investor to start thinking about financial goals and how to achieve them. Accessing statements online and charting your own personal savings progress over time is wonderfully empowering and gives a real sense of achievement as you see your assets grow. For the seasoned investor, it’s an ideal opportunity for some top-up savings over and above your regular investments and retirement contributions.
Start by defining a lifestyle goal – such as saving for a deposit on a house or a new car; a long awaited overseas trip; children’s education; a new baby; retirement; or simply saving for a rainy day. Alternatively, formulate a financial goal according to how much you would like to or can afford to save per month or as a once off contribution.
Rutherford Online, our digital investment environment will take you from there and guide you seamlessly through the advice and risk profiling process to finally signing off the investment in the privacy and convenience of your own home. For savings of up to R33 000 per year a Tax-Free Savings Account or Unit Trusts are options, and for larger investments Unit Trusts are available. Both products are suitable for once off lump sum deposits or regular monthly contributions. Given that funding your retirement over 30 working years instead of 40 years, you will need 30% more savings; there couldn’t be a more compelling reason to start saving sooner rather than later.
Submitted April 13, 2017 at 06:08AM by Rutherford_Capital http://ift.tt/2p9M9M0
