Robo advisor is an automated program that provides financial advice. It manages your investment through a computerized algorithm without a person monitoring them. Some aspects of financial planning are personal only trading, monitoring, and trade execution function through this digital portal. It is essential to understand how much-personalized service is needed before opting for this program.
Why this program is the best and affordable?
It is essential to understand the limitations of the program to reduce costs and risks. It is crucial to understand the difference between Robo advisors and traditional financial advisors. There are some human elements like comfort, reassurance, encouragement, or perseverance, which only a person can provide.
One should evaluate their costs before opting for any one. With proper communication, one can also combine both as boundaries shift very frequently in this volatile market; it essential to communicate when the machine or the person must step up.
There are two main features of Robo advisors-
- Portfolio Management: Robo advisors create optimal portfolios based on consumer preferences. A variant of modern portfolio theory is used to create a portfolio that focuses on allocating funds to stocks that are not perfectly correlated.
- Tax-loss harvesting involves the sale of securities at a loss to maintain the portfolio allocation and gain profits from an upturn in the market. Robo advisors help in increasing profits by automation.
There are many advantages of Robo advisors-
- Cost-effective: Robo advisors are less expensive than your traditional advisors. They offer their financial management services at a low cost.
- Easy to use and secure: Robo advisors are convenient for the consumer as they can be used from anywhere with the internet. They are also secure as only the authorized personnel are allowed to access the customer’s account.
- Customized: The financial plan made by these advisors cater specifically to consumers’ need and requirements.
- Transparency: Investors can demand their financial transactions at any time from financial services. As the dealings are digitized, there is no space for corruption.
- Efficiency: As all the transactions occur without paper and pen, the computations are very efficient.
Robo advisor white label are advising the consumers on white label products. White labelling refers to a process wherein a company uses the expertise of another company to make a product and then puts its personal touch on it. It has many benefits. Firstly, it saves a lot of resources. As the expert company is making the product, all the raw materials and processing cost is being paid by it. This keeps a lot of resources. Secondly, companies benefit from each other’s experiences. Thirdly it helps the desired product to get to the market faster, overcoming the administrative hurdles.