Standalone robo-advisers ‘will not attract’ HNW investors

The research comes in the wake New York-based robo-adviser Hedgeable opting to shutter its business, and found that “robo-advisers by themselves do not attract assets under management”.

“In addition, high-net-worth (HNW) investors are not flocking to transfer their assets to standalone challenger platforms. GlobalData’s 2018 survey of wealth managers found that just 10 per cent of private wealth managers feared they would lose market share to robo-advisers over the next 12 months,” the research firm said in a statement.

However, GlobalData said that while robo-advice as a standalone service is unlikely to build assets under management, it will provide advisers with a competitive edge.

“Even though there is mounting evidence that standalone robo-advice alone will not attract affluent investors ... [but] it will offer competitive advantage to traditional wealth managers over competitors,” the business said.

“The survey found an enduring and growing demand for robo-advice, with 40 per cent of private wealth managers noting strong demand for the technology from their clients, more in the fast-growing Asia-Pacific region. Investors are increasingly looking at it as a tool that every wealth manager should be deploying on their behalf.”