What Is Robo Investing And Why It Might Be Right For You?

They make investing affordable

If your opting for a traditional wealth management service, or anything actively managed, fees are likely to be quite high. This is because a person has been employed to oversee your investments and monitor the market. Robo investing platforms use predominately computers to look at market data, although this could be alongside a small team. So this means costs and fees associated with these platforms are relatively low.

By eliminating human labor you can expect to be charged an annual flat fee of around 0.2-0.5%. This compares to a typical rate of 1-2% for human financial planners.

The platforms are easy to use

You don’t need to know a lot about investing or finances to use a robo investing platform. The robot experts will do all of the hard work for you, from building a plan and making changes that may be needed.

The cons of robo investing

You can’t choose your own investments

Typically these platforms don’t give you a bespoke plan so you can’t choose your own investments. Instead the algorithm will choose where your money is investments. But this isn’t to say you have no choice or input. You can choose which investment product to get including Stocks & Shares ISAs and ethical plans. Or if you’re investing for a child: Junior Stocks and Shares ISAs.

You can also pick the risk level that suits you as well. The experts will build you a plan with investments suitable to your risk appetite, and you can change it if your situation or mindset changes.