Tech: a must-have building block for your portfolio?
This week marks 34 years since the video game Tetris – one of the most widely-sold games in...
Last month, we asked FundCalibre investors how they chose their investments¹. An overwhelming 75% said they liked to decide themselves, using a range of trusted research to gather information. A further 19% specified they would use a platform’s rating or buy lists, perhaps, for guidance.
Where investors weren’t too keen was the area of robo-advice, with just 1% saying they currently use such a service. The result backs up an international survey conducted by ING bank² earlier this year, in which 91% of people said they “would not let a computer program make and act on financial decisions on their behalf”.
Looking deeper, there were discrepancies between countries. Respondents in the United States seemed more willing to accept the possibility of a computer program not only making recommendations to them but also buying or selling investments without first requiring their approval – albeit still in very small numbers. On the other hand, respondents in France, Austria, Luxembourg and Australia were the most resistant to any idea of automated financial activities.
So is this likely to change any time soon? Technology has already significantly altered the way people approach their finances and not so many years ago, many would have shrugged off the idea of doing their banking on-the-go on a mobile app, applying for and taking out a home loan online without any human contact, or paying for something simply by tapping their phone to a processor.
Robo-advice could similarly gain momentum and it is definitely an issue for the industry to remain aware of. But, for now, it looks like the current media focus may somewhat overstate its importance to everyday investors.
¹Based on the responses of 63 FundCalibre site visitors between 1 May 2017 and 31 May 2017
²The ING International Survey Mobile Banking 2017 –Newer Technologies was conducted by Ipsos using internet-based polling. Fifteen countries were surveyed between 7 and 27 February 2017. The full report is available via SlideShare.