Robo-Advisors: Exploring and Leveraging the Competition

Centre for Financial Planning Studies, 2020

17 Pages Posted: 1 Mar 2020

See all articles by Prince Sarpong

Prince Sarpong

The University of Free State; Centre for Financial Planning Studies

Date Written: January 30, 2020

Abstract

There are lot of talks about robo-advisors taking the jobs of human financial advisors. Amid the excitement or anxiety about robots doing better than humans in many aspects, there is little discussion on the potential limitations of machines in taking over certain aspects of the financial planning process. What are the technologies behind robo-advisory systems, what are the pitfalls, and will they really replace human advisors? In this paper, I review recent literature on robo-advice and conclude that human advisors adopting robo-advisors into their practices will enhance their practices even further and deliver better outcomes than either standalone robo-advisors or human advisors.

Keywords: Robo-Advisors, Machine Learning, Artificial Intelligence, Asset Allocation, Modern Portfolio Theory, Cognitive Technology

JEL Classification: G10, G11, G20

Suggested Citation

Sarpong, Prince, Robo-Advisors: Exploring and Leveraging the Competition (January 30, 2020). Centre for Financial Planning Studies, 2020, Available at SSRN: https://ssrn.com/abstract=3528174 or http://dx.doi.org/10.2139/ssrn.3528174

Prince Sarpong (Contact Author)

The University of Free State

School of Financial Planning Law
P O Box 339
Bloemfontein, 9301
South Africa

Centre for Financial Planning Studies ( email )

South Africa

HOME PAGE: http://www.cfps.co.za

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