Robo-advisors, also known as virtual financial advisors, have surged in popularity as they offer a low-cost and an easy way to manage an investment portfolio. Additionally, they give you access to wealth management services previously reserved for the ultra-wealthy including access to a licenced financial planner and tax loss harvesting. Consequently, new firms are entering the market and established robo-advisors are increasing their service offering. This can make it difficult for you to choose the best robo-advisor.
In this post, we look at some of the top-rated robo-advisors you may want to consider:
Nutmeg is the largest digital advisor in the UK with more than £1 billion in assets under management. It invests in three asset classes – fixed income, equity and money markets. The robo-advisor offers two investment styles – fully managed portfolios and fixed allocation portfolios – all of which are diversified across asset classes, sectors, and countries.
Fully managed portfolios are built and managed by Nutmeg’s in-house investment team. Fixed allocation portfolios, on the other hand, are developed by the robo-advisor’s team but with no ongoing strategic intervention.
The company charges an annual fee of 0.25% to 0.75% of an investor’s portfolio value.
Wealthify, part of Close Brothers Group, is a robo investment service that uses low-cost investment options including mutual funds and ETFs. With this robo-advisor, you can invest with as little as £1 or as much as £1,000,000.
Similar to other robo-advisors, Wealthify requires you to complete a risk questionnaire to create your investment portfolio. Once the portfolio has been created, the robo-advisor employs a team of investment experts to manage it.
Wealthify charges an annual fee ranging from 0.4% to 0.7% of the total value of your investments.
This is another robo-advisor behemoth with more than £260 million in assets under management. It builds you a personalized, diverse portfolio based on your answers to a risk-assessment questionnaire. The investment portfolio consists of a mix of asset classes including equities, commodities, and bonds among others.
The portfolios are built and managed by a team of experts known as the Asset Allocation Team. The team tracks performance against your investment goals and rebalances your portfolio when necessary. The robo-advisor’s annual fees range from 0.4% to 0.7% of your portfolio.
4. Scalable Capital
Scalable Capital is a relative new fintech company based in London and Munich. It was established in 2016 and currently has £200 million in assets under management. It uses Exchange Traded Funds (ETFs) to invest in different asset classes including equities, bonds, stocks, real estate and commodities.
The robo-advisor allows you to open an Individual Savings Account (ISA) and/or a General Investment Account (GIA). It charges a fixed annual fee of 0.75% plus a cost of investing in ETFs which is 0.25% of your portfolio’s value.
5. Wealth Horizon
Wealth Horizon, a subsidiary of Aberdeen Asset Management, is one of the best robo-advisors in the UK for a good reason. It does not only build and manage your investment portfolio but also allows you to access a human financial advisor when you need financial advice. The robo-advisor invests in several asset classes including equities, bonds, stocks, and cash among others.
The company charges an initial fee of 0.25% and an annual fee of 0.93% of your portfolio’s value.
These are just some of the best robo-advisors in the UK. However, it is important to note that the best digital wealth management advisor will vary from investor to investor depending on their needs and financial situation.