What is Automated Investing?
Automated investing or Robo advisor is the use of digital platforms that make algorithmic trading decisions or financial planning.
Automated investing services or tools are utilizing the methodologies that make it easy to invest inexpensively and efficiently. These services take the hassle and uncertainty out of the investment and process.
How to choose a Robo Advisor?
Most of the robotic or automated investment services look identical, usually, an investor needs to choose the stock and the tools do the rest as little to no human effort is needed.
But still, there are some factors that can be considered while selecting and differentiating an investment robot. Have a look at the following:
- Management fees: The cost of using a Robo advisor. A must factor to compare among various automated investing tools.
- Service offerings: Comparing the service offering can help in increasing your return. Some of the services can be auto-rebalancing, harvesting tax loss, and portfolio allocation based on the risks and goals.
- Custody: Whether you have to transfer money to a custodian or to some well-known brokerages.
- Investments: Taxable and IRA retirement accounts are offered by all but SEP-IRA for the self-employed are not offered by all.
- Stocks: Option to invest in individual stocks.
- Taxes: There can be tax-loss harvesting features in a Robo advisor.
Best Automated Investing Tool
Our pick for the best automated investing tool is Unhedged, a simple to use mobile app that lets Australian users invest in US markets easily by utilizing the complex algorithms at the backend which makes the use of sophisticated trading algos feasible for a common investor.
Some Salient Features offered by Unhedged include:
- Creation of portfolio in no time
- Automate your investments
- Easy investment performance monitoring
- Transparent pricing
- Referral based fee free monthly usage
Process For Roboinvesting
- Download the Unhedged app
- Signup and create a portfolio by selecting pre-build or custom portfolio
- Add your funds
- Autopilot investments are setup and Unhedged algorithms are in action
Pros and Cons of Using a Roboinvesting Tool
Let’s have a look at the pros and cons of using any robo advisor.
|Low Cost||Personalization is limited to some extent|
|Nobel Prize-Winning Investment Models are in Action||Lowering the pricing by the financial advisors|
|Increasing the financial advice market||Limited human interaction|
|Rebalancing and tax-loss harvesting|
|Low minimal balance limits|
|No emotional decisions|
|Easy to white label for financial advisors|
You dont need to be rich for using robo advisors as they offer really low minimum investment. Also you don’t need to have expertise in financial services to participate in this hybrid investment model. And Unhedged is a good option to start the autoinvestments’ journey.