Digital wealth management advisors – more commonly referred to as robo-advisors – are gearing up to feel the full force of a bear market for the first time ever.
Low risk, solid return
For people who have invested using robo-advisors, the advantages are fairly straightforward. The significant
This essentially means that an investor’s money will be automatically allocated to low-risk channels according to the information they offer. It also eliminates the possibility of panic sales. Another huge selling point for robo-advisors to date has been the very low or no-minimum requirement
A bear market
Every so often, the market hits the reset button and for a period of time (generally estimated to last a little over one year), optimism and confidence in stocks is replaced by pessimism and sales driven by fear.
More seasoned investors will probably share the wisdom of the old trading adage, “Bulls make money, bears make money, pigs get slaughtered.” It simply preaches calm and objectivity in the midst of extreme highs and lows. Robo-advisors and their digital base might be relatively new to the game, but the old rules still apply. Temperance is the most valuable asset in an upturn, and the same is true for audacity in a downturn.