Robo-ad­vis­ers help in­vestors in­stead of wealth man­agers

China Daily (USA) - - WUZHEN - By CAI XIAO caix­iao@chi­

Lead­ing Chi­nese peer-topeer lend­ing and wealth man­age­ment com­pany Cred­itEase Corp is de­vel­op­ing a robo-ad­viser prod­uct to serve small and medium do­mes­tic in­vestors.

A robo-ad­viser is an on­line wealth man­age­ment ser­vice that pro­vides au­to­mated, al­go­rithm­based port­fo­lio man­age­ment ad­vice with­out the use of hu­man fi­nan­cial plan­ners.

“With busi­ness pat­terns and in­no­va­tion, small and medium in­vestors can en­joy per­son­al­ized fi­nan­cial ser­vices and bet­ter man­age their wealth,” said Tang Ning, CEO of Cred­itEase Corp.

“We are largely de­vel­op­ing a robo-ad­viser prod­uct, ToumiRA, to serve these cus­tomers.”

Tang said they have about 1 mil­lion small and medium in­vestors at their plat­form.

Launched in June, ToumiRA is a robo-ad­viser mo­bile ap­pli­ca­tion that can cre­ate as­set al­lo­ca­tion so­lu­tions for in­vestors based on their in­vest­ment goals and risk pref­er­ences. The thresh­old to be an in­vestor is $500.

ToumiRA’sport­fo­lio in­cludes ex­change traded funds of eq­uity, bond, gold and real es­tate in both de­vel­oped coun­tries and emerg­ing­mar­kets.

Ac­cord­ing to Tang, the robo ad­viser can as­sess hun­dreds of clients aday. In­tra­di­tional wealth man­age­ment, an ex­pert can as­sess no more than 10 clients a day.

“Thus, the au­to­mated

The au­to­mated wealth man­age­ment ser­vice will greatly de­crease fees and in­crease ef­fi­ciency.” CEO of Cred­itEase Corp

Tang Ning, wealth man­age­ment ser­vice will greatly de­crease fees and in­crease ef­fi­ciency,” saidTang.

Ac­cord­ing to Tang, the robo ad­viser has a strong ca­pac­ity for risk con­trol. For in­stance, ToumiRA­suf­fered a very small loss in the first two weeks af­ter the Brexit vote.

Mean­while, Cred­itEase is also de­vel­op­ing big data tech­nol­ogy to help eval­u­ate in­di­vid­u­als’ cred­it­wor­thi­ness.

Tang said by adopt­ing big data tech­nol­ogy, they are able to pro­vide in­ex­pen­sive but bet­ter ser­vice to cus­tomers.

Zhang Shishi, pres­i­dent of the New Fi­nance Group, said mo­bil­ity, data and in­tel­li­gence will be vi­tal for fin­tech.

“In the past five years, mo­bil­ity and data have been widely used in the fin­tech sec­tor, and­in­tel­li­gence willbe­sig­nif­i­cant for the sec­tor in the com­ing­five years,” saidZhang.

Zhang also said that roboad­viser prod­ucts will be pop­u­lar be­cause they can of­fer small and medium in­vestors pri­vate bank­ing ser­vices.

The New Fi­nance Group is also launch­ing a mo­bile ap­pli­ca­tion called Black Card to of­fer white col­lar in­vestors in­tel­li­gent fi­nan­cial and life ser­vices.

Sep­a­rately, Cit­i­group Inc re­leased a re­port that as­sets un­der man­age­ment by robo ad­vis­ers in­creased to $18.7 bil­lion at theendof2015, while in 2012 the amount un­der man­age­ment was close to zero.

Ac­cord­ing to a re­port from AT Kear­ney, the com­pound an­nual growth rate of the global robo-ad­viser mar­ket will be 68 per­cent for the com­ing three to five years and the mar­ket value in 2020 will to­tal $2.2 tril­lion.

WangAn, chief­brand­of­fi­cer of Cai­fu­pai, be­long­ing to the New York-listed Noah Hold­ings Ltd, a wealth and as­set man­age­ment ser­vices provider, said robo ad­vis­ers will be key to sup­ple­ment­ing tra­di­tional wealth man­age­ment.

Cai­fu­pai, which was launched in 2014 by Noah, is a pro­pri­etary in­ter­net fi­nance plat­form to pro­vide fi­nan­cial prod­ucts to as­pir­ing high-net-worth in­di­vid­u­als and en­ter­prises in China.

“But it will take some time for the au­to­mated wealth man­age­ment tools to re­ally pro­vide ser­vices for in­di­vid­ual in­vestors as the coun­try has yet to de­velop a large data­base of users of on­line wealth man­age­ment tools,” Wang said. Qiu Quan­lin con­trib­uted to the story.

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