In a bar late at night....
- Grant Pearson
- Dec 6, 2015
- 2 min read
How robo advice isnt always a good thing but it sure is threatening traditional advisers
Imagine this... You are in your favourite bar late at night. Happy, but having drunk way too much and after hours of deep conversation with a friend on investing you suddenly have hit a Eureka moment! With profound clarity and insight you have found the secret to doubling your savings and retiring early. Thanks to robo advice and on the way to the bathroom you open your Smartphone, check your retirement account and in 3 clicks have redeemed the lot.
Not only that, in another 3 clicks you have deposited the proceeds into two mining stocks in Mongolia via the Shanghai exchange your were debating just minutes earlier. Hah- this investing thing is simple. Thank you robo-advice. Can't wait to get home and tell my partner!
Sound farfetched? Actually it's not. This is the capability focus of most robo-advice offers. Recently a large wealth manager did a survey on who and when investors accessed their on-line portal of their investment accounts. Guess what they learnt? Mainly men use them; and after midnight was the peak period they traded funds. Of course that's when we make all our best decisions isn't it? Seems women are smarter.
Clever robo advice is not simply purchasing and executing investments, nor just to manage cash flow (as many bank and Australian I.T houses are developing). Clever technology supports and takes the hard yakka out of processing, calculating and reporting.
What is missing is both meaning to a person's hopes and dreams for the future and insight. Insight is not just clever data or research. Without meaning and insight being involved it's like giving your 16 year old L-Plater a bottle of vodka, the keys to your brand new uninsured luxury car and saying " hey take it for a spin!"
So be careful, most of what is out there is simply designed to get you to use a product of some sort (stock transactions or ETFs for example), and to enrich the wonder kids from California. It has its place but a very small and specfic one.
You have been warned!
Comments