Robo Advisors

Robo Advisors

Last Updated: June, 2020

Robo Advisors Canada

A Robo Advisor is an online investing platform. Robo Advisors use software algorithms to help guide clients and balance their portfolio. Robo Advisors generally offer a selection of set portfolios you can choose from.

When you sign up with a Robo Advisor, you answer a set of questions about your age and investment goals. Your answers help the Robo Advisor determine the best portfolio for you.

Robo Advisors

Robo Advisors are popular with younger investors, comfortable completing daily tasks online. They also have low investment requirements. This makes them popular with low-income investors as well.

One of the most significant advantages a Robo Advisor offers is low fees. A traditional brokerage can charge up to 2% or more in fees. A Robo Advisor charges less than 1%.

Robo Advisors do not offer a wide variety of investment options. They offer a set range of exchange-traded funds (ETFs). This limits your investment choices but helps keep costs low.

If you want to make your investment selections, then a Robo Advisor would not suit you. You cannot self-manage your money with a Robo Advisor.

As well, Robo Advisors are not considered to be a fully managed solution. With managed money, a money expert is making investment choices on your behalf.

There are some major Robo Advisors in Canada. Among the biggest, are Wealthsimple, JustWealth, WealthBar, BMO SmartEase, and RBC InvestEase.

They all offer low fees – none of them charge higher than 0.7%. Several Robo Advisors charge even lower fees.

They offer a varied ETFs you can choose from. These ETFs offer the advantage of covering several sections of the market. You can select the ones that suit your risk tolerance and investment goals best.

Think about your comfort level for investing online. Determine your goals and what’s important to you. Then do some online research to determine the best Robo Advisor for you.

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