Autowealth gives financial planners a run for their money
When 29-year-old Ching Kai Chen first tried the beta test version of Autowealth, a robo-advisory platform that doles out financial investment services, he was impressed by its combination of convenience and intelligence. “Investing can take a substantial amount of time – stock picking, monitoring individual company results and getting the analysis correct. I wanted a simpler and less risky way of investing, and Autowealth provided the right product for me,” he said.
Unlike human financial planning, Autowealth’s robo-advisory platform automates the entire investment process to make it simpler, and more convenient. Customers start by taking a two-to-three-minute online questionnaire, which feeds into the robo-advisory system. This helps create a full picture of customer’s financial situation, risk profile and financial goals.
Autowealth’s proprietary algorithm analyses the customer’s answers and recommends a tailored investment portfolio. Meanwhile, its platform technology automates 80% of the financial advisory and investment management process that enables them to offer low fees that are 25% that of traditional financial services, or at 0.50% per annum on the assets under advice and US$18 per annum platform fee. In comparison, Autowealth COO Noel Lee noted that traditional investment through mutual funds typically comes with excessive sales charges, annual management fees and other hidden charges that stacks up to about 2% per annum on average. “Combining higher returns with a lower fee structure, our clients are able to take home way higher net returns compared to mutual funds or financial planners,” said Lee.
Whilst robot automation brings major improvements to the Autowealth investment process, there is still human touch. Customers can meet face-to-face with one of the startup’s financial advisory representatives, all of whom are licenced by MAS, to ask more questions and to open their Autowealth account through which portfolio performance can be monitored on demand. “We believe a hybrid model will particularly address the needs of the older population, whom we also desire to serve,” said Lee.
After its official launch, Autowealth is setting its sights on getting the word out to more Singaporeans through more roadshows and seminars, including investors that are not as familiar with digital technology. The startup is also engaging regulators and industry bodies to further nurture the robo-advisory industry.