10 Best Robo-Advisors: Q4 2022
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Larger, independent robo-advisors continue to experience strong growth and provide innovative features, according to the latest Robo Report, which includes the 10th Robo Ranking.
The report, which Condor Capital Wealth Management released Tuesday, noted that banks, brokerages and other traditional advisory firms have been adopting robo-advice technology, which offers customers significantly lower minimum investment and costs.
The Robo Report tracks the performance of 57 accounts at 32 different providers, and the Robo Ranking Winter Edition looks in depth both at the robo platforms‘ qualitative factors and underlying account performance.
The ranking grades robo-advisors on more than 45 metrics, scoring each on high-level categories such as features, financial planning, customer experience, access to live advisors, transparency and conflicts of interest, size and tenure, account minimums, costs and performance.
“These analyses come at a time when according to some historians, 2022 was the worst year for bonds in over 250 years,” Ken Schapiro, Robo Report publisher and Condor Capital Wealth Management founder, said in releasing the report.
The best overall robo-advisor, an innovation leader, offers a top-tier digital experience that “strikes an impressive balance between simplicity, functionality and customization,” Condor Capital’s investment research manager, David Goldstone, said.
The runner-up, meanwhile, has expanded its financial product offerings in recent years, giving members free access to live financial planning services, as it aims to compete with national banks for retail investing and banking customers, Goldstone added.
The report also cites winners in certain sub-categories, such as best for complex financial planning (Vanguard Personal Advisor), best for digital financial planning (Personal Capital), best performance at a low cost (Wealthfront) and best for first-time investors (SoFi), and offers readers the chance to view detailed data on robo portfolio performance.
The Robo Report named Wealthfront, Schwab’s Domestic Focus and Morgan Stanley Inflation Conscious as the “decisive winning accounts” for the full year in terms of asset performance, and noted 2022 “will go down in financial history as one of the worst for the ‘60/40’ investor.” Allocations to municipal bonds have driven fixed income performance for three years, the report said.
The Robo Report started opening accounts at robo-advisors in 2015 to offer greater transparency on the industry. (Its main portfolio at Wealthfront, which led in performance for the past one-, three- and five-year periods, holds a dedicated energy allocation that contributed to its “fantastic outperformance” in 2022; newer Wealthfront accounts don’t include this allocation and other investors will not have seen the same results, the firm said.)
See the gallery for the top-ranked robo-advisors for the fourth quarter of 2022, per the Robo Ranking Winter Edition. These rankings cover investment performance for the three years ending Dec. 31, 2022.
(Image: Adobe Stock)
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