The company has acquired FutureAdvisor, with the aim to provide financial institutions with high quality, technology-enabled advice capabilities to improve their clients’ investment experience. No fees were disclosed for the takeover.
FutureAdvisor was described in the buy out statement as being capable of “personalised advice that can look holistically across clients’ brokerage, tax- efficient portfolio management; mobile and web applications; online account enrolment; and multi-custodian support”.
Blackrock said it was “a leader in digital wealth management”.
Tom Fortin, head of retail technology for BlackRock, said: “As demand for digital wealth management grows, we believe that our combined offering will accelerate our partner firms’ abilities to serve the mass affluent in a convenient, scalable way.”
Robert Goldstein, chief operating officer and global head of BlackRock Solutions, said: “BlackRock Solutions has a history of offering technology and advisory services to a broad range of institutions. The acquisition of FutureAdvisor is an extension of BRS’ mission to help clients solve their most complex investment challenges through technology.”
Bo Lu, chief executive officer and co- founder of FutureAdvisor, said: “BlackRock has dedicated enormous effort over the years to improving financial outcomes through its leading active and passive investment offerings as well as innovative retirement planning tools including its CoRITM Retirement Indexes. We look forward to integrating and delivering this expertise to investors in partnership with financial institutions in the months to come.”
What do Financial Planners think of robo-advice?
Nicola Watts CFPCM, director of Jane Smith Financial Planning, recently told Financial Planner Magazine: “Whatever your opinion, I think that automated services are going to grow, and let’s be honest if they are a solution that works for certain consumer groups, then let’s embrace them.
“If technology and automated advice can help in filling this gap, then it has to be welcomed. What worries me is that whilst it will almost certainly be suited to certain people, others with more complicated issues will inadvertently be led down routes which they shouldn’t be taking.
“The complicated nature of their affairs won’t be fully addressed and they won’t be receiving the “bespoke” advice that they need. Will these systems be able to identify these cases?”
Martin Bamford CFPCM, managing director of Informed Choice, believes the technology has great potential.
Asked if artificial intelligence ever replace a human Financial Planner, he said: “Never say never when it comes to technology. Based on current tech, I would have to say no, but the speed at which technology is being developed means we shouldn’t rule out artificial intelligence which is far superior to a real-life Financial Planner, probably within a much shorter space of time than we expect.” He added: “That said, enough clients will want the experience of a human Financial Planner to continue to make this a profession in demand.”