Tuesday, February 2, 2016

Worried Investors Are Calling Their Robo-Advisors

Ritholtz smiles.
From the Financial Times:

‘Robo-advisers’ try to calm investor nerves
The biggest “robo-advisers” are relying on old-school call centres and blog posts to calm anxious investors, trying to persuade them that there is no need to abandon the algorithms in times of heightened volatility.

Automated investment services have expanded rapidly in the US in recent years, attracting mostly younger customers with the promise of managing pots of their money at a fraction of the cost of a human being. Yet almost all of that growth has been achieved in a gently rising market — prompting some traditional rivals to predict that once prices drop and tensions rise, clients will no longer be happy to be guided by software.

Charles Schwab, which has raced to about $5.3bn in assets under management since launching its robo service last March, says that it has asked staff to work longer hours to cope with a roughly one-third increase in calls from customers since December. Online chats have picked up too, as customers have sought advice on rebalancing portfolios and optimising tax bills amid the rougher environment of the past few weeks....MORE