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Sorry for the possible off-topic, but can anyone explain to me how the robo-advising is different/better/worse than constant passive investing into popular ETFs, e.g. $SPY, $BND, $VOO, etc.?
really interesting takeaways from the Wealthfront landing page[0]: * every example is shown as a smartphone app - not a single "desktop-oriented" screenshot to be found. I guess we are finished with the days where every service has an app. Now, every service is an app. * In the first example, an investment portfolio is shown where roughly 10% of the holdings is in a group called "single stock bets." Yikes! Though may…
I wish the US had something better than Plaid to track various account balances. That’s all I use Wealthfront for, now UBS owns all the data and has my logins.
Tracking multiple account balances has gotten less easy as more accounts offer 2-factor. There really ought to be some kind of standard for granting scoped read-only data auth to authorized 3rd parties for financial info, but presumably every business wants to wall their gardens with delusions about consumers not having to work with multiple companies and backwards notions that friction keeps people in instead of dri…
It’s gotten worse over the years as banks have stopped support for open APIs. I guess because of plaid-type integrators that make custom interfaces. I’ll likely quit my bank (usaa) as they got rid of any api access unless you go through third parties.
I’m not willing to give my account credentials to a third party like plaid where the downside is draining most of my liquid assets and investments.
Earlier quoted context omitted.
Is there really that much utility in automating that? It takes a few clicks to move money from a checking account in Schwab/Fidelity to a target date fund or index ETF.
There's utility in automating anything you do manually the exact same way repeatedly and regularly
Earlier quoted context omitted.
I suspect you are on to something. Maybe they were waiting for valuations to return to earth? The make versus buy decision was much harder when these platforms were richly valued. I could a lot of acquisitions in the coming months as capital moves out of growth at all costs fintech space and startups need a lifeline.
I think the "build" can be considered a clear failure at this point, it would take 10min on the JPM "platform" to see that. Not acquiring ShareBuilder was a major loss, especially given that CapitalOne purchased ShareBuilder, took the customers, and killed the platform. Not sure why the platform couldnt have been spun off to JPM (?except perhaps competition?) GS purchased FolioFN, which was a lesser player, but still…
I wouldn't count JPM out though. I'd imagine they have been bulking up on cash by taking on debt for future acquisitions while interest rates were/have been low. They know this game well.
Now that interest rates are starting normalize - they can now go pick the best of the best them - be it HOOD, SOFI, etc. at more reasonable valuations (or at least 50%+ of their 2021 peaks).
Does HOOD at $50B make more sense or maybe just wait until it hits $8B. Plus the DAUs are more stabilized now that the hype has died down. And you get Dodd Frank compliant/audited accounting data instead of VC style EBITDA/DAU only data?
In addition they can pick based on who's app is actually the most sticky/metrics and get to see all the apps internal metrics while doing "due diligence for a potential aquisition".
Sorry for the possible off-topic, but can anyone explain to me how the robo-advising is different/better/worse than constant passive investing into popular ETFs, e.g. $SPY, $BND, $VOO, etc.?
Super interesting. Wealthfront has approximately $27 billion USD in AUM according to this article [0]. Meanwhile the leading robo-advisor in Canada, WealthSimple recently raised funds at a $5 billion CAD valuation, on a $7.7 billion USD AUM [1]. I have felt for a while like the robo-advisory market is in roadrunner mode - has run past the edge of the cliff but hasn't quite yet fallen. Maybe this is the first sign tha…
Wealthsimple now has in house advisors who email and call you to discuss your account. There is nothing 'robo' about the business model anymore and instead they are just focused on growing AUM by talking to people and convincing them to move more of their savings/TFSA/RRSP over to them.
I'm honestly shocked at how primitive the big firms' offerings are. For example, JPMChase's bank account is smart enough to see a payroll deposit and give you a comment modal suggesting that you invest the money with JPM's investment platform (YouInvest/whatever) Log into the investment platform and you're back in 1993. They literally have no drip-investment style offering. They want to charge you 100bps to "manage"…
Honestly it’s probably a good thing. Chase is pretty awful at basic retail banking. Really only makes sense if you live in Manhattan or something where there are like 3 mega banks in every corner.
Anyone know of any other product offer that will take excess after direct deposit and invest it for you? I've called Fidelity and Betterment and both do not offer an automated way like wealthfront does. Really sad to see wealthfront being the only player in that space. Edit: by automated I mean something like "everything over $10k after bills, invest". It takes a couple of clicks per month manually, but it's been pre…
Maybe I'm misunderstanding, but nearly every bank I've ever used offers this feature. I currently have auto-transfers and auto-investments set up in Fidelity. If you receive a paycheck, you can easily set up Fidelity so that it automatically transfers $xxxx dollars per month to whatever account you like. You can also set up each account to automatically purchase $xxxx dollars worth of whatever equity you want.
really interesting takeaways from the Wealthfront landing page[0]: * every example is shown as a smartphone app - not a single "desktop-oriented" screenshot to be found. I guess we are finished with the days where every service has an app. Now, every service is an app. * In the first example, an investment portfolio is shown where roughly 10% of the holdings is in a group called "single stock bets." Yikes! Though may…
Don't read too much into marketing materials.
It's likely that they surveyed a lot of potential customers and found a significant number were afraid that Wealthfront wouldn't allow them to choose individual stocks. So that factoid filtered its way over to the graphics design department, who were told to prominently display something about how you can still buy individual stocks.