Passive Robo-Advisors: Betterment, Wealthfront, Schwab Intelligent Portfolios
Advisor Robo-Advisors: Personal Capital, FutureAdvisor, SigFig
Active Robo-Advisors: Hedgeable, Hedgwise, Huygens, Alpha Architect
This is relevant and interesting:
[quote=http://www.aaii.com/computerized-invest ... ns-capital]McClellan: Yeah, we’ve talked a lot about the volatility over the last couple months.
Vester: Sure. It’s been the thing that’s been on everybody’s mind. I’m curious as you follow the robo-advisers… What has been your read on how they handle volatility like this? Have they handled it well?
McClellan: I read some articles saying that customers were panicking when markets became volatile and, to make matters worse, they couldn’t call in to someone to have their concerns put to rest. Phone lines were busy and calls weren’t being returned. Some robo-advisers, like Wealthfront, turned to social media to ease concerns about market volatility and sent email updates to clients before the worst of the storm began.[/quote]
The Robo-Advisor Files
Moderator: Global Moderator
-
MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
The Robo-Advisor Files
Last edited by MachineGhost on Fri Dec 04, 2015 7:30 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
-
MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: The Robo-Advisor Files
The newest one, Huygens, just came out this summer. $20K minimum and 1.25% fee. (They may have lowered it to $10K already.)
[img width=800]http://i.imgur.com/IpfWGv6.png[/img]
[quote=http://www.aaii.com/computerized-invest ... ns-capital]McClellan: Can you summarize how your system switches, using recent market volatility as an example?
Vester: We just went through a period of pretty severe volatility in the equity market. There was the devaluation of the yuan, which started around August 17 or 18, and it caused a burst of volatility that led to that very rapid sell-off in late August.
Our system went defensive after the market close on August 21, which was a Friday, so pretty much in line with when volatility was really getting severe. And then it maintained its defensive positioning up until October 6.
During that period of volatility when nobody really knew if the market was going to sell down another 10% or what it was going to do, when markets were up 2% one day and down 2% the next day, our system was defensive, meaning that it was not moving anywhere near as much as the equity market. So it was delivering reduced volatility during a highly volatile period. When the market is getting nutty like that, just get the client out of it and wait until the storm passes.[/quote]
[img width=800]http://i.imgur.com/IpfWGv6.png[/img]
[quote=http://www.aaii.com/computerized-invest ... ns-capital]McClellan: Can you summarize how your system switches, using recent market volatility as an example?
Vester: We just went through a period of pretty severe volatility in the equity market. There was the devaluation of the yuan, which started around August 17 or 18, and it caused a burst of volatility that led to that very rapid sell-off in late August.
Our system went defensive after the market close on August 21, which was a Friday, so pretty much in line with when volatility was really getting severe. And then it maintained its defensive positioning up until October 6.
During that period of volatility when nobody really knew if the market was going to sell down another 10% or what it was going to do, when markets were up 2% one day and down 2% the next day, our system was defensive, meaning that it was not moving anywhere near as much as the equity market. So it was delivering reduced volatility during a highly volatile period. When the market is getting nutty like that, just get the client out of it and wait until the storm passes.[/quote]
Last edited by MachineGhost on Fri Dec 04, 2015 7:29 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
-
MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: The Robo-Advisor Files
[img width=800]http://i.imgur.com/C9ImkG8.png[/img]
Last edited by MachineGhost on Fri Dec 04, 2015 9:35 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Re: The Robo-Advisor Files
Thank you for posting this info. Huygen's performance vs the S&P looks great. I wonder if one can verify it.MachineGhost wrote: Passive Robo-Advisors: Betterment, Wealthfront, Schwab Intelligent Portfolios
Advisor Robo-Advisors: Personal Capital, FutureAdvisor, SigFig
Active Robo-Advisors: Hedgeable, Hedgwise, Huygens, Alpha Architect
This is relevant and interesting:
http://www.aaii.com/computerized-investing/article/an-active-approach-to-robo-advising-huygens-capital wrote:McClellan: Yeah, we’ve talked a lot about the volatility over the last couple months.
Vester: Sure. It’s been the thing that’s been on everybody’s mind. I’m curious as you follow the robo-advisers… What has been your read on how they handle volatility like this? Have they handled it well?
McClellan: I read some articles saying that customers were panicking when markets became volatile and, to make matters worse, they couldn’t call in to someone to have their concerns put to rest. Phone lines were busy and calls weren’t being returned. Some robo-advisers, like Wealthfront, turned to social media to ease concerns about market volatility and sent email updates to clients before the worst of the storm began.
Are you investing with any of these firms?
-
MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: The Robo-Advisor Files
Notice that Huygen's performance is backtested. The recent live performance so far isn't impressive. I think they're charging too much also, but at least they are equity-only as opposed to diversified so there's a better chance of actually seeing outperformance after such a big fee.flagator wrote: Thank you for posting this info. Huygen's performance vs the S&P looks great. I wonder if one can verify it.
Are you investing with any of these firms?
I have checked them all out, but I am only invested with Hedgeable. They offer you a choice of different portfolios, though it takes a bit of finagling with the Investment Profile to see them all. You can have conservative, all weather, equity heavy, yield focused or even socially responsible (pay heed, jafs!). They do have a glaring spot in that they don't provide a higher returning equity heavy portfolio that's multiple tilting diversified. For some reason the one that does has poor relative returns not much better than the simpler PP. I just switched out of the all weather to their riskiest portfolio which holds individual tech stocks (not my first choice, but it is all they offer until you reach $100K+). Part of this was because I'm now re-adopting the PP as my strategic portfolio allocation so I didn't need an all weather portfolio in my Prosperity space (pay heed, Reub!). But the other is that the subpar live returns for all portfolios except the riskiest or so since QEternity started in 2011 doesn't cover their yearly fee and/or beat their corresponding indexes. The live outperformance of the riskiest is $70K terminal wealth vs $5K terminal lwealth for all weather, or $20K terminal wealth with the 100% domestic equity which was just tracking the market indexes like a closet indexing fund. That is a gaping difference! And finally, the live MaxDD for all portfolios are essentially the same since they all use the same constant proportion portfolio insurance for downside risk management.
Last edited by MachineGhost on Sat Dec 05, 2015 3:20 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
-
MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: The Robo-Advisor Files
It is a mobile app, automated investment platform for investing in stocks that are in the top 5 of 10 of these guru screens:MangoMan wrote: What is Baton? I don't see that mentioned anywhere else in this thread.
http://www.validea.com/stocks/mp.asp?ty ... portfolios
I believe it is a "grey box" so you cannot see the screening rules to verify that the guru behavior is implemented properly. The performance certainly seems to have been below that of similar screens from AAII:
http://www.aaii.com/stock-screens
DIY with RobinHood once a month is way cheaper if you wanna do that kind of thing.
Last edited by MachineGhost on Sun Dec 06, 2015 6:53 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!