It’s been an exciting few years in the world of artificial intelligence (AI) and robotic process automation (RPI). From the advances in autonomous vehicle technology to the rise of online chatbots, it’s hard to find any part of the world that hasn’t been changed by these transformative new technologies. For the average person, though, AI and RPI technology remain a somewhat abstract concept; something to marvel at but still not a factor in daily life.
That doesn’t mean, however, that AI and RPI haven’t already created some useful tools that people can use to their advantage every day. One place where that’s decidedly true is in the world of finance. For example, scores of people are now making use of automatic savings apps as a means of building wealth one auto-transfer at a time. The concept has proven so popular that many banks are adopting the technology right into their own apps, making it even easier for customers to save.
That’s not the only way that AI and RPI are providing new options for individuals to build wealth. In fact, there’s a much more consequential set of developments happening in the world of personal investing. It’s the rise of so-called robo-advisors, which offer low-to-no cost investment management with better-than-average returns. Here’s a look at four of the best of the bunch.
Wealthfront
Among the new crop of robo-investors, there’s no bigger success story than Wealthfront. Since beginning their operations under the name KaChing, the company has grown to the point that it now manages more than $11.4 billion in investor assets. As anyone in finance can tell you, that’s a good sign that they know what they’re doing.
The Wealthfront robo-advisor is loaded with features that can help novice investors feel comfortable with the service, including automated portfolio rebalancing to maintain diversification, multi-level tax-loss harvesting to reduce taxable gains, and automatic dividend reinvestment to help grow the investor’s portfolio.
With a minimum opening deposit of $500 and the ability to manage anything from IRAs to 529 college savings accounts, there’s almost no investing goal Wealthfront can’t help you achieve. Plus, there are no fees for managing up to $5,000, and just a .25% management fee after that, it won’t break the bank, either.
SoFi Automated Investing
Aimed at millennials and novice investors, SoFi Automated Investing offers an algorithm-powered platform with a low barrier to entry. How low? You can open an account with as little as $100, and there are no management fees at all. That makes it a perfect service for young people and beginners since it’s so easy to get started.
Right now, the service only handles traditional non-retirement accounts and IRAs, so it’s not as versatile as Wealthfront – but for a free service, there’s a lot to like. First, SoFi performs automated daily rebalancing of accounts to maintain a user-specified risk profile. Second, their portfolio is one of the broadest in the industry, including ETFs from more than 20 indexes.
If that’s not enough, SoFi also offers free unlimited access to real, live financial advisors who take no commissions and work to help customers understand their options and make better decisions. All in all, it’s a high-performing product at an unbeatable price, so it’s worth a look.
Betterment
Like Wealthfront, Betterment is one of the biggest and best-known robo-advisors available today. Managing a staggering $16.4 billion in investor assets, they’re often called the originator of the robo-investing revolution.
They have a reputation for performance and have the data to back it up. In fact, from the bottom of the market in 2009 (at the peak of the financial crisis), Betterment managed to beat the returns of the average human advisor by a whopping 78.7%, and that’s after taking into account their .25% management fee.
Best of all, they boast a $0 minimum balance, handle almost any kind of investment account imaginable, and offer advanced automated tax-loss harvesting, rebalancing, and a full complement of DIY visual planning tools. Customers can even opt to keep their funds invested in socially responsible companies and bond offerings so they can save the world while getting richer at the same time.
Crypto CFD Trader
So far, the robo-advisor market has hued toward ETF products and other traditional investment vehicles. All the while, however, investors in the volatile cryptocurrency markets have been left out of the loop. Now, however, Crypto CFD Trader aims to change all that. It’s a software package that caters to the crypto-investor and allows for automated trading of cryptocurrencies using what’s known as a contract for difference (CFD).
Essentially, a CFD allows a trader to turn a profit on financial assets that display high fluctuations in value – which is what cryptocurrencies do these days. The software allows the investor to set risk tolerances and automate their trades to take advantage of the movement in the market.
The platform has a wealth of features that make it a good fit for anyone looking to diversify into crypto-assets, and with a minimum opening deposit of $250, it’s a good way to test out an investment market that could produce unbeatable returns over the long haul.
Robots For Fun and Profit
Put simply, the AI and RPA revolutions are creating new opportunities for individuals to grow their investment portfolios while sporting low fees and solid returns. Even at this early stage, there are robo-advisor platforms to suit any type of investor and every different goal.
They’ve even worked their way into cryptocurrencies, offering beginners a new way to grow their wealth. Remember, though, all investments carry inherent risk, so don’t invest money you can’t afford to lose. If you’re not risk-averse, though, there’s plenty of robo-growth to be had out there – all you need to do is go out and get started investing.
Last Updated on February 3, 2021.
