YUP, THERE’S AN APP FOR THAT
How would you feel about trusting the management of your investment portfolio to a robot? That’s what’s on offer as‘ rob o-advice’ starts to look more and more like a viable way of managing investment.
Financial services can be pretty complex products. As banks find new ways to crunch customer data, and as self-learning computers become more refined, many believe that FinTech machines are rapidly becoming capable of making faster, more accurate judgements than human advisors.
This means much lower costs, hyper-personalised service, and the opening of markets to those with less to invest. And it’s imagined that, ultimately, you won’t even know if you’ re dealing with a human or a machine.
There’ s money behind the idea too. Global spending on wealth management initiatives is set to reach US $12 billion by 2019, and that’ s due mainly to the potential of rob o-advice services.
While there are plenty of opinions when it comes to investing, there are no guarantees and markets are not always rational. As a rather skeptical story in the Financial Times said: “By attempting to create technology that emulates humans and then beats them at their own game, this new breed of [AI] fund may simply end up aping all of the worst characteristics of human investors … Computers will have an edge in processing large amounts of economic data, but may struggle with the more qualitative judgments [Warren] Buffett has excelled in such as judging the character of a chief executive or the durability of a brand.”