The best Robo-Advisors of 2022
Since the global financial crisis that began in 2007, savers' confidence in banks and their financial advisers has declined. More and more investors are not sure who they can trust with their money and which financial products they should invest in. Two US fintech companies (Betterment and Wealthfront) recognized this trend and began offering specially designed platforms in 2008 to suggest investors an investment strategy calculated using an algorithm.
Such an investment platform is calledRobo-Advisor. However, it is not a robot that makes the investment recommendations. Instead, experienced investment advisors and computer experts create a special program that takes over investment management entirely for the client or simply provides investment advice.
1.- Comparative table of the best Robo-Advisors of 2022
Betterment and Wealthfront are still around today and are pioneers in automated investment management. However, from 2008 until now many Robo-Advisors have appeared on the market worldwide. Also for Spanish-speaking investors there are currently more than one and two Robo-Advisors. But how to find the best Robo-Advisor? With this comparison you can find the most suitable for you.
Producto analizado | Cartera de fondos de inversión | Plan de inversión | Cartera de ETF | Carteras Profile | Carteras de fondos indexados | Carteras indexadas | "Cartera individualizada" | Invertimos por ti |
Tipos de activos | Fondos indexados | Fondos indexados | ETF | Fondos de inversión de gestión activa y fondos indexados | Fondos indexados | Fondos indexados | Fondos indexados | Fondos de inversión de gestión activa y fondos indexados |
Número de carteras | 30 | 5 | 10 | 6 | 5 | 5 | (completamente individuales) | 5 |
Aportación mínima | 3.000 € | 1.000 € | 5.000 € | 3.000 € | 1.000 € | 150 € | 2.500 € | 500 € |
Costes totales | Max. 0,66% | Max. 0,65% | Max. 0,71% | 0,77% | 0,62% | 0,447% | Max. 0,97% | Max. 1,03% + TER |
Rebalanceo | Desviación >2,5% de la distribución objetivo | Anual o desviación >20% de la distribución objetivo | Trimestral o desviación >3% de la distribución objetivo | Desviación >5% de la distribución objetivo | Trimestral | Semestral | Si | Si |
Entidad depositaria | Cecabank o Banco Inversis | Banco Inversis | Interactive Brokers | Cecabank | Bankinter | Andbank Wealth Management, SGIIC, S.A.U | Banco Inversis | Banco Santander |
Accesibilidad (Países) | Suiza, UK y Unión Europea (menos Chipre, Malta y Gibraltar) | Unión Europea (excepto Gibraltar) | Todos salvo EEUU, Japón, Hong-Kong, Australia y paraísos fiscales | España | España | España | Todos | España, Holanda, Portugal y Alemania |
Test de tolerancia al riesgo | Si | Si | Si | Si | Si | Si | Si | Si |
Promoción | 10.000 € sin comisión de gestión durante 1er año | 12.000 € sin comisión de gestión durante 1er año | 50 € de regalo al empezar a invertir | 50 € de regalo al empezar a invertir | Sin comisión de gestión el 1er año y hasta 300€ por traer a tus amigos |
Robo-Advisor | Producto analizado | Tipos de activos | Número de carteras | Aportación mínima | Costes totales | Rebalanceo | Entidad depositaria | Accesibilidad (Países) | Promoción |
|---|---|---|---|---|---|---|---|---|---|
Cartera de fondos de inversión | Fondos indexados | 30 | 3.000 € | Max. 0,66% | Desviación >2,5% de la distribución objetivo | Cecabank o Banco Inversis | Unión Europea (menos Chipre, Gibraltar y Malta), Suiza y UK | 10.000 € sin comisión de gestión durante 1er año | |
Plan de inversión | Fondos indexados | 5 | 1.000 € | Max. 0,65% | Anual o desviación >20% de la distribución objetivo | Banco Inversis | Unión Europea (excepto Gibraltar) | 12.000 € sin comisión de gestión durante 1er año | |
Cartera de ETF | ETF | 10 | 5.000 € | Max. 0,71% | Trimestral o desviación >3% de la distribución objetivo | Interactive Brokers | Todos salvo EEUU, Japón, Hong-Kong, Australia y paraísos fiscales | 50 € de regalo al empezar a invertir | |
Carteras Profile | Fondos de inversión de gestión activa y fondos indexados | 6 | 3.000 € | 0,77% | Desviación >5% de la distribución objetivo | Cecabank | España | 50 € de regalo al empezar a invertir | |
Carteras de fondos indexados | Fondos indexados | 5 | 1.000 € | 0,62% | Trimestral | Bankinter, S. A. | España | ||
Carteras indexadas | Fondos indexados | 5 | 150 € | 0,447% | Semestral | Andbank Wealth Management, SGIIC, S.A.U | España | Sin comisión de gestión el 1er año y hasta 300€ por traer a tus amigos | |
"Cartera individualizada" | Fondos indexados | (completamente individuales) | 2.500 € | Max. 0,97% | Si | Banco Inversis | Todos | ||
Invertimos por ti | Fondos de inversión de gestión activa y fondos indexados | 5 | 500 € | Max. 1,26% | Si | Banco Santander | España, Holanda, Portugal y Alemania |
Sources: Data obtained from the official pages of each entity dated 03.13.2022. Data without guarantee.
Percentages preceded by "Max." They must be understood as maximum percentages that can decrease depending on the volume of investment managed, the permanence or the types of financial assets.
2.- What is a Robo-Advisor?
The term Robo-Advisor is made up of Robo and Advisor. Robo logically comes from Robot, that is, from automaton and Advisor is the English word that means adviser. From here we can pretty well intuit what a Robo-Advisor does, he is aautomatic investment adviser. This means thata robot or an algorithm is in charge of advising and sometimes even managing, instead of an individual such as a bank adviser or a financial adviser, with which emotions do not come into play, which are basically the main reason, which makes investors lose money.
3.- How does a Robo-Advisor work?
Robo-Advisors work in the same way on most platforms:
1.- To start you have tofill out a questionnairewith which the Robo-Advisor can verify your risk tolerance. The questionnaire usually has between ten and thirty questions, which you must answer truthfully. The number of questions depends on the different Robo-Advisors but this process will not take you more than 5-10 minutes.
2.- Once the risk test has been carried out, the Robo-Advisor will be well informed about you and your financial situation and will be able to prepare apersonal risk profile.
3.- For each risk level, the Robo-Advisor assigns asolo portfolio, that is, a kind of shopping cart with various financial products. This can be conservative, in which, for example, you have a large part of low-risk fixed-income investments, such as deposit accounts or government bonds. Or it can be aggressive, that is, oriented towards profitability, where you have a very large part invested in equities or raw materials.
4.- After making atransfer of at least the minimum contribution, the Robo-Advisor buys the proposed financial products and you can now stop worrying about the investment. Many Robo-Advisors offer the possibility of making periodic contributions and automatically investing them in your portfolio.
4.- Robo-Advisor Full-Service or Self-Service
Within the Robo-Advisors it can be differentiated into two categories:
Full-Service Robo-Advisor
These Robo-Advisors offer a service ofdelegated management of your investment portfolio. This means that the Robo-Advisoradopt discretionary and individualized all decisions related to the management of your securities portfolioand you can make the decisions you deem most convenient at any time in order to achieve the best profitability/risk for your portfolio. Among these decisions are the selection of assets, the execution of operations and the rebalancing to restore the original distribution of the different asset classes of your portfolio.
Self-Service Robo-Advisor
The “Self-Service” Robo-Advisors they simply adviseand they recommend what you can buy, but the purchase itself, you have to execute yourself in your securities account. This service is offered for examplejust-ETFfree up to a certain point from which you have to switch to the Premium version, which is paid or other platforms such asMyCapitaleitherFeelCapital.
In this article we focus from now on Full-Service Robo-Advisors.
5.- Criteria for choosing a Robo-Advisor
Now that we know what Robo-Advisors are, we are going to see what are the important points when deciding on one or the other.
Security
The fact that many of the Robo-Advisors are relatively young does not affect the safety criteria. The Robo-Advisor isjust an intermediarybetween you and the depositary bank, which means that all the financial assets you buy through that Robo-Advisor are deposited in a bank that meets all security standards. At no time does Robo-Advisors own the financial assets purchased. This means that it isjust as safe as buying the stocks or ETFs yourselfand deposit them in your securities account.
All Robo-Advisors based in Spain are authorized and supervised by the CNMV and the Bank of Spain. Furthermore, by this very fact, they areattached to the Investment Guarantee Fund (FOGAIN) and the Deposit Guarantee Fund (FGD), with an amount of up to €100,000 per holder and account.
In fact, security is one of the most important criteria for Explorador Financiero and we would not present here any Robo-Advisor that was not authorized by the competent body and attached to a guarantee fund.
Minimum initial investment
When it comes to choosing the most convenient Robo-Advisor, the minimum amount of investment must also be taken into account. If you want to invest less than the minimum initial investment of the Robo-Advisor, logically you will not be able to choose that Robo-Advisor.
The minimum initial investment to be made in each of the different Robo-Advisors depends on the type of product selected and differs greatly from one Robo-Advisor to another. You can see the products selected in each Robo-Advisor in the comparative table of the first section. InBestMe is the one with the highest minimum initial investment with €5,000 for ETF portfolios. Then come IndexaCapital and Finanbest with €3,000 and Finletic with €2,500. Then come Finizens and PopCoin with a minimum initial investment of €1,000, only surpassed by OpenBank with €500 and by MyInvestor with €150, which adjusted its minimum initial investment in the first half of 2021 to also lead in this criterion and In this way, lower the barrier even more to be able to invest and become the most accessible Robo-Advisor in Spain.
Sources: Data obtained from the official pages of each entity dated 03.13.2022. Minimum contributions depend on the type of product. See color table section 1. Data without guarantee.
asset types
The financial instruments used by Robo-Advisors are mainly indexed investment funds orETFs, since these are very cheap financial products and precisely the low costs are one of the main arguments of Robo-Advisors.
Some of the Robo-Advisors have hybrid management and invest in both index funds andinvestment funds actively managed, the latter almost always associated with fixed-income investment funds. This active management is reflected in commissions that are somewhat higher than those of other Robo-Advisors.
Commissions and costs
It is important to differentiate the costs, sinceOn the one hand we have the management commissions and the depositary commissions, which are the ones that the Robo-Advisors and the depositary bank charge you directly for their management and custody respectively. Generally, the more money you invest through Robo-Advisors, the lower these commissions will normally be.
On the other hand, we have theintrinsic costsof assets, TER (Total Expense Ratio), which logically depends on the assets managed by the Robo-Advisor and which generally cannot be known for sure in advance.
Here you can see that Robo-Advisors are somewhat more expensive than when we create our portfolio ourselves, since we have to pay the commissions plus the TER, while in the case of creating our portfolio ourselves we only pay the TER.The total costs of the Robo-Advisorsthat we show you nextare in the order of 0.5% to 1% of the total capital invested (VAT included). Even so, Robo-Advisors are much cheaper thaninvestment fundsactive management. They are also cheaper than when you let yourself be advised by an independent financial adviser or one employed by a bank that, even if it is free, will always charge us high commissions when carrying out the transactions or will try to sell you the products of its own bank, which they are not always the best for you or the best performers.
In the following table you can see in detail the management commissions and depositary commissions that Robo-Advisor will charge you in addition to the cost of the assets, which are not charged by Robo-Advisor but are discounted in the price of the assets. It is worth mentioning that in this table we have put the maximum commissions and costs. These may be less than what appears in the table. Thus, for example, the management commission decreases the greater the volume of managed capital. In Finizens it not only decreases with more volume but with the years of membership. In turn, the cost of the assets is also a maximum value and may decrease depending on the assets in the assigned portfolio. Thus, the portfolios with the greatest weight in equities are generally somewhat more expensive than the most conservative ones.
Entity
depository commission
Total
Link
Max. 0.147%
+
0.15%
+
0.15%
=
Max. 0.447%
0.13%
+
0.49%
+
-
=
0.62%
0.12%
+
Max 0.41%
+
0.12%
=
Max. 0.65%
Max. 0.11%
+
Max. 0.43%
+
0.12%
=
Max. 0.66%
0.19%
+
Max. 0.41%
+
0.11%
=
Max. 0.71%
0.27%
+
Max. 0.39%
+
0.11%
=
Max. 0.77%
Max. 0.13%
+
Max. 0.726%
+
0.12%
=
Max. 0.976%
Max. 0.23%
+
Max. 1.03%
+
-
=
Max. 1.26%
Sources: Data obtained from the official pages of each entity dated 03.13.2022.
Percentages preceded by "Max." They must be understood as maximum percentages that can decrease depending on the volume of investment managed, the permanence or the types of financial assets
From this comparative table it is worth highlighting MyInvestor with commissions and total costs below 0.5%, which currently makes them extremely competitive.
rebalancing
The rebalancing or also called automatic readjustmentis responsible that you always have your portfolio very adjusted to your investment profile. In this way, it sells the funds that have risen and buys the funds that have fallen, in relative terms, put more simply,sell “high” and buy “low”.
Due to price fluctuations in the market, the prices of different assets evolve differently, some increase, lose or maintain their value. In a long-term strategy, it is important to frequently restore the original asset allocation. Let's take a simple example to understand it better:
-
Suppose we have a portfolio made up of 70% equity ETFs and 30% fixed income ETFs. After a certain period of time, let's say a year, the return of the variable income ETF has been greater than that of the fixed income ETF and now the weight of both in our portfolio is 80% / 20%.
-
The rebalancing in this case would consist of selling the remaining 10% of the variable income ETF and passing it to the fixed income ETF to rebalance the portfolio.
Rebalancing is not only important to maintain the initial risk level of our portfolio, but also because there are studies that show that the total return of the portfolio increases in the long term.
Accessibility (Countries)
accessibility, that is,from which countries it is possible to open an account and invest in the different Robo-Advisors, is surely an important criterion for our Spanish-speaking community, who not only reside in Spain.
And it is that we have a few Robo-Advisors such as Finanbest, Popcoin and MyInvestor that only allow the opening of the account being residents in Spain, but we have others that are somewhat more international. Openbank, for example, offers the same product in Germany, the Netherlands and Portugal as well as Spain. Then we have Finizens who offer the Robo-Advisor within the European Union with the exception of Gibraltar. Likewise, Indexa Capital is also available in the European Union except Malta, Cyprus and Gibraltar, but includes Switzerland and the United Kingdom. Now, without a doubt, the most international are InBestMe, through which it is possible to invest from all countries in the world with the exception of the United States, Japan, Australia and countries considered tax havens. Finally, the most international is Finletic, which allows you to open an account regardless of the country where you reside. Both InBestMe and Finletic are excellent options for all those Spanish-speaking investors who reside outside the European Union, such as all Spanish-speaking countries in the Americas, and who want to enjoy the security of regulated and supervised entities in Europe.
Sources: Data obtained from the official pages of each entity dated 03.13.2022. Data without guarantee.
Choosing a Robo-Advisor is a very personal decision. Apart from the criteria that we show you here, you have to see for yourself if it meets what you are looking for, if you like its monitoring panel, if it shows you detailed information on the instruments in which you invest, if you want the Robo-Advisor also has an app where you can follow the evolution of your portfolio on your mobile.
6.- Advantages of Robo-Advisors
Straightforward and simple to use
You sign up, do the risk test, transfer money and that's it. In theory you do not need to know or research where to invest and although we always recommend getting a little information before investing money, the truth is that Robo-Advisors eliminate from the equation the complicated factor of deciding which assets or financial products to invest in.
automated
They eliminate the human factor and emotions that are sometimes so dangerous in the investment world. In addition, they perform automated tasks that we would have a hard time doing on our own, such as portfolio distribution tracking and rebalancing.
economic commissions
Low fees compared to actively managed funds and are substantially cheaper than funds marketed by traditional financial institutions.
Access to the institutional class of investment funds
They have access to funds with very favorable conditions that individuals could not access directly unless we invested a very high amount.
independent entities
They are independent entities, which always look for the best options for your risk profile, which leads them to work with the most favorable funds for the investor.
Regulated
Robo-Advisors are supervised by the competent bodies in their country of origin, in the case of Spain, by the CNMV and the Bank of Spain.
Professional investors with great experience
Behind the Robo-Advisor algorithms are professional investors whose goal is to offer the highest possible return with an acceptable level of volatility. For beginning investors, this means that you are in very good hands and that investing through Robo-Advisors decreases the possibility of making a bad decision due to inexperience.
7.- Disadvantages of Robo-Advisors
low flexibility
You cannot choose or modify the Asset Allocation of your portfolio to your liking. The Asset Allocation is fixed and is linked to the level of risk selected when doing the test. Of course, you can always change the risk you want to assume and a different Asset Allocation will be assigned to you.
Commissions not so low
Commissions are low, but they are higher than if you invested on your own. Although this is somewhat logical, because the professional automated management behind Robo-Advisor has to be paid for somehow.
At this point it should be noted that Robo-Advisors are not a protection against possible losses when investing. There are phases in which money is lost, which is why we recommend investing through Robo-Advisors with a long-term time horizon. Robo-Advisors are not worth it for short-term investments.