Tag: Digital Advice
Posted on October 13, 2020
Welcome to the Backend Benchmarking company update. In this article, we share news of our Research team preparing to write the Q3 Robo Report and testing our application for bugs, our Development team getting closer to the finish line, Backend’s media appearances since the Barron’s feature, and exciting news on a partnership with an Ivy League university professor.
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Posted on September 27, 2019
The term “Robo-Advisor” has become commonplace to describe a new breed of digital investment management solutions. Although there is not an official definition for the term, robo-advisors share a few key characteristics. Mainly, they are automated platforms that provide investment and financial planning services. Created in response to the lack of access to traditional advisors amongst less affluent investors, robo-advisors lower the cost and ease of investing in a professionally managed, globally diversified portfolio. They do this by leveraging algorithm-driven technology in the client management and investment selection process.
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Posted on September 24, 2019
Vanguard is piloting and is expected to soon release a new digital planning and automated-investing product called Vanguard Digital Advisor, according to a document filed with the SEC. Vanguard Digital Advisor will have a $3,000 minimum and an all-in fee of 0.20%, placing it in direct competition with providers targeting less affluent investors. In doing so, Vanguard will undercut incumbents Fidelity and JP Morgan, who both have all-in costs—management and underlying fund fees— of 0.35% and independents Wealthfront and Betterment, who have all-in costs of around 0.33% and 0.36%, respectively depending on the portfolio chosen.
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Posted on September 21, 2019
When digital investing was first introduced, platforms quickly began accumulating assets. Digital advisors were labeled industry disruptors, as talks of fee compression, the commoditization of professional asset management, and disruption of the investment advice industry ran rampant. Digital advice providers had the advantage of emerging during a historic multi-year bull market. Over the last four years, the market has continued to mature, adoption has spread across major financial institutions, and new consumer trends have emerged. An increasing number of companies are battling for market share and institutions have developed their own offerings. In the race to achieve scale, the largest independent advisors continue to expand product offerings to stay a step ahead of incumbent players and maintain impressive rates of asset accumulation.
Posted on September 4, 2019
After faltering at the end of last year, U.S. and global markets have returned to a period of strong growth in 2019, with the S&P 500 returning 4.30% in the second quarter. While this was considerably less than the first quarter’s return of 13.65%, due largely in part to markets rebounding sharply following a December selloff, the combined return marks the best first half-year performance for domestic markets since 1997. Many trends from the first quarter continued through the second quarter, as mid-cap continued its outperformance and growth once again outperformed value. Growth has experienced a multi-year dominance, outperforming value YTD, as well as over the trailing one-, two-, and three-year periods.
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Posted on May 30, 2019
SoFi has been making headlines this month, as they have recently introduced two proprietary ETFs. The funds are as follows:
- SoFi Select 500 (SFY) tracks the performance of 500 of the largest U.S.-listed companies weighted based on a proprietary mix of their market capitalization and fundamental factors
- SoFi Next 500 (SFYX) tracks the performance of the 500 smallest of the 1,000 largest U.S.-listed companies weighted based on a proprietary mix of their market capitalization and fundamental factors.
SoFi continues to diversify their offerings, as they have also recently announced a partnership with two fintech insurance firms. SoFi now plans to offer homeowners and renters insurance through Lemonade and auto insurance through Root. This has been a busy month for Sofi, as they are rumored to be working on an additional round of funding, estimated as $500M. This funding round, reportedly led by the Qatar Investment Authority, is expected to be at a similar valuation to their last round in February 2017.
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