In short, and on the whole, apparently not.
It is reported today (14th Jan 2019) that Moola is to be the latest online robo-advice platform to close for business at the end of February, having struggled to gain any real momentum in the market since its launch in 2015. Client’s assets will simply be sold and cash placed into their bank accounts.
This follows the closure of Click & Invest by Investec in May 2019 after suffering 2 years of losses and, in August 2018, the closure by UBS of its robo-advice service, SmartWealth, just over a year after it launched.
Nutmeg is one of the UK’s largest robo-advisers in terms of managed assets, passing the £1.5 billion mark in December 2018. However, despite this and having over 60,000 customers, Nutmeg remains unable to make a profit. In fact, in the year ending December 2018 Nutmeg reported a loss of £18.5 million, an increase on the £12.1 million lost by the business in 2017.
Some of the problems prevalent in the automated online investment market are those of the cost of client acquisition, including marketing, and the costs of regulation, along with low average investment values per client.
However, for people looking for properly researched and considered advice the most important and apparently insurmountable problem of all is that we don’t trust technology alone to assess and analyse our financial planning needs. When considering the complex needs that many of us have, and to take account of our changing circumstances over time, we prefer to work face to face with an adviser who we can build a long term relationship with.
A computer algorithm cannot appreciate or understand the subtle nuances that are part of any human interaction and in financial planning terms can therefore only deal with the very simplest of scenarios. For now at least it remains the case that your financial adviser is uniquely placed to best understand your circumstances and work with you to provide a truly tailored financial planning solution.
If you would like to discuss you person financial planning and arrange a Free Financial review, please do not hesitate to contact us on 0114 2588899 or email firstname.lastname@example.org. Our Independent Financial Advisers are qualified to provide advice in the areas of retirement planning, tax planning, savings, inheritance tax, investments and protection.
Source: Andrew Ball, Independent Financial Adviser at Fogwill & Jones Asset Management Limited.