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Investment advice via algorithm: These are the best robo advisors

Robo Advisor

With digital asset managers, an IT system gives customers recommendations.

(Photo: Moment/Getty Images)

Dusseldorf The principle behind the digital asset managers is similar to the classic investment with the help of an advisor: Investors indicate how risk-averse they are and for what period of time they want to invest their money. The provider makes a suitable suggestion and builds the portfolio accordingly.

The decisive difference: Instead of financial advisors and portfolio managers, digital asset managers have an IT system that gives the customer recommendations and implements the investment strategy, preferably in ETFs.

Providers advertise that the investment is based on scientific knowledge instead of personal inclination. Above all, automation saves money because there are no management fees. However, compared to direct investments in passive products such as ETFs, robo advisors are more expensive.

The Frankfurt-based financial consultancy FMH examined 24 robo-advisors and evaluated them with regard to an investment strategy with a 60 percent equity component. In doing so, she took minimum investment amounts, costs and performance into account.

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Source: www.handelsblatt.com

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