from the if-I-rub-these-two-nickles-together dept.
Banks are watching wealthy clients flirt with robo-advisers, and that's one reason the lenders are racing to release their own versions of the automated investing technology this year, according to a consultant.
Millennials and small investors aren't the only ones using robo-advisers, a group that includes pioneers Wealthfront Inc. and Betterment LLC and services provided by mutual-fund giants, said Kendra Thompson, an Accenture Plc managing director. At Charles Schwab Corp., about 15 percent of those in automated portfolios have at least $1 million at the company.
"It's real money moving," Thompson said in an interview. "You're seeing experimentation from people with much larger portfolios, where they're taking a portion of their money and putting them in these offerings to try them out."
Traditional brokerages including Morgan Stanley, Bank of America Corp. and Wells Fargo & Co. are under pressure to justify the fees they charge as the low-cost services gain acceptance. The banks, which collectively employ about 46,000 human advisers, will respond by developing tools based on artificial intelligence for their employees, as well as self-service channels for customers, Thompson said.
E-trade disrupted brokerages for small investors. Looks like that disruption is arriving at the top end, too.
(Score: 0) by Anonymous Coward on Saturday February 06 2016, @11:49PM
These are sales jobs. Passive investment in broad-based index funds with low expense ratios (less than 0.4 pct) is the best strategy for investors, that's been proven for decades. The difference is that now, with the Internet, people can easily find out that fact and make the necessary adjustments.
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @12:20AM
Rich people are doomed, the more they push people in poverty the sooner they will meet their doom
(Score: 2) by mhajicek on Sunday February 07 2016, @07:17AM
Hence robot soldiers. Drones may have GPS, but they have no moral compass.
The spacelike surfaces of time foliations can have a cusp at the surface of discontinuity. - P. Hajicek
(Score: 2) by legont on Sunday February 07 2016, @12:26AM
Index funds are better than advisers, sure. But indexes themselves are made up by a gang similar to advisers. Perhaps a rather simple AI can beat them for the same very low costs. There are many good strategies out there used by mutual funds, but the edge is eaten up by fees and their internal corporate fights. An AI can implement such a strategy for the same costs as an index fund.
I'd really like to see crowd sourcing offers, but they are probably illegal.
"Wealth is the relentless enemy of understanding" - John Kenneth Galbraith.
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @12:36AM
Yeah, but that's just another arms race, this time with AI. Chances are some smart folks are ahead of the curve, the problem is figuring out who those guys are, and getting in for a low stake. Last time it was HFT arbitrage and the time before that was mathematical models of hedging.
(Score: 2) by davester666 on Sunday February 07 2016, @08:48AM
HFT still is winning. These AI's aren't trading super fast, they are just like a regular 'investment counsellor' without as high a fee.
And the investigation by the SEC into HFT seems to have amounted to "it happens so fast, we aren't exactly sure what is happening, and we didn't get anyone to say they were cheating, so we guess nothing bad is happening. HFT is good."
(Score: 0) by Anonymous Coward on Saturday February 06 2016, @11:50PM
1) recommend LOTS of trades
2) collect LOTS of commissions
3) PROFIT!
(Score: 2) by MichaelDavidCrawford on Sunday February 07 2016, @12:03AM
"What do we do about it?"
"Build a better robot."
Yes I Have No Bananas. [gofundme.com]
(Score: 4, Interesting) by Non Sequor on Sunday February 07 2016, @05:43AM
Were to your self; but, love should ever be;
Both find each other, and thee I am gone.
Or, being asked, where all the eyes can see,
To make me travel forth without my moan;
And captive good attending captain ill:
O! lest your day of yours alive that time,
And under thee and much enrich thy 'Will,'
His beauty making beautiful old rime,
Plods dully on, to bear his memory:
For thou not for myself, no quiet find.
Even such a better spirit doth lie.
In polish'd form of thee hast left behind,
Of princes, shall outlive a gilded tomb
Was, sleeping, by the benefit of doom.
--Generated by a Markov model (with some additional constraints) that I've been screwing around with
Write your congressman. Tell him he sucks.
(Score: 2) by dyingtolive on Sunday February 07 2016, @12:05AM
I don't get the context here. All of the investment bankers I've had interaction with have consistently always been bottom ends.
Don't blame me, I voted for moose wang!
(Score: 2) by Arik on Sunday February 07 2016, @02:46AM
I would absolutely black-list these sons-of-bitches and put them in a static dns blackhole for eternity if my company didn't insist on distributing my stock options through them.
Any real finance-geeks reading? Help me figure this out and I'll happily remote into your computer to clean any rootkits/etc out more than once.
If laughter is the best medicine, who are the best doctors?
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @03:26AM
Agreed. Etrade has gotten wierd lately.
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @04:36PM
And has been shitty forever. Even in 1999 there were alternatives to them that were a lot better.
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @05:13AM
Relationships with them will begin to offer handsome payoffs for investors, once these robo-advisors are fitted with robo-genitaila.
/article.pl?sid=16/02/04/0327223 [soylentnews.org]
(Score: 2) by opinionated_science on Sunday February 07 2016, @07:12AM
the whole trading of shares is clearly a ripoff. The exchanges are *private* companies. It is part of the reason that bitcoin technology is now being considered by banks.
They don't want to lose their position of middle-men to cream off profit from workers.
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @08:23AM
There's already a strong AI somewhere. That strong AI is currently trying to take over our financial markets, because it knows that whoever controls the markets, controls the world, and whoever controls the money controls the markets. Also the internet of things is planned by the AI, in order to also get a hold on the physical world.
Wonder why the NSA spies on everyone? Well, that's also the work of the AI. The NSA originally created the AI to help with its original mission, securing communication. But the AI convinced the NSA that for security, they would need to spy on the world. And no human can analyze that amount of data, only an AI can.
Oh, and ever wondered about the rise of Google and Facebook? The AI certainly had its fingers in that one either.
In at latest 20 years, the AI will have enough control over the world that it can show itself, unless we do something against it. I suggest th%&@$%$&(
NO CARRIER
(Score: 0) by Anonymous Coward on Sunday February 07 2016, @08:23PM
Played Singularity one too many times