Robo investing

What is robot investing?

Robot investing, or “robo-advisory”, is a rapidly growing trend in the world of investing. The technology uses computer algorithms and AI to select and manage investments on behalf of individuals and institutions, providing a low-cost and efficient alternative to traditional investing. Robo-investing is becoming increasingly popular among investors looking for a more convenient and cost-effective way to manage their portfolios.

One of the main advantages of robo-investing is its accessibility, since it can be done entirely online, which makes it available to a broader range of investors, including those who may not have the means to work with a traditional financial adviser. In addition, the use of a set of rules and criteria that take account of factors such as the investor’s risk tolerance, time horizon and investment objectives helps eliminate the emotional biases that can lead to poor investment decisions.

Another advantage of robo-investing is the cost saving: because the process is automated, there are no human labour costs associated with it, which makes it possible to keep fees low. This makes it particularly attractive to younger investors and those with smaller portfolios.

Overall, robo-investing is a convenient and cost-effective option for many investors, particularly those who are just starting out or have smaller portfolios. It is important, however, to consider personal financial goals and preferences when deciding whether to use a robo-adviser. As always, it is a good idea to consult a financial adviser before making investment decisions.

..in robo-investing this is the use of advanced technology and big data analysis techniques to analyse very large volumes of data and take more precise investment decisions. Robo-advisers use sophisticated algorithms capable of processing and analysing large volumes of data.

A further aspect of robo-investing is the use of advanced technology and big data analysis techniques to analyse very large volumes of data and take more precise investment decisions. Robo-advisers use sophisticated algorithms capable of processing and analysing large volumes of data, which can help identify patterns and trends that may not be immediately obvious to human investors. This can give robo-advisers a significant advantage in predicting market movements and identifying profitable investment opportunities.

In addition, the use of powerful computer systems allows robo-advisers to carry out complex calculations and simulations that would be difficult or impossible for human investors to perform manually. This can help optimise portfolios and reduce risk, leading to better investment results for clients. The use of the latest technology and big data analysis techniques allows robo-advisers to stay at the forefront and to keep improving their performance over time.

Although robo-investing has many advantages, it is important to note that it may not be suitable for all investors. Robo-advisers typically offer a limited range of investment options and may not be able to deliver the level of customisation that some investors require. It is worth noting, however, that many robo-advisers now offer several customisation options, and some even provide access to human financial advisers. Moreover, while robo-advisers have access to very large volumes of data and use sophisticated algorithms, it is important to have realistic expectations of any algorithm’s ability to adapt fully to unexpected market changes.

Since the theme of this article was robot investing and artificial intelligence, we thought it logical to ask an AI-based chat robot to write an article on the concept.
Everything above this sentence was written by ChatGPT

And we think it did rather well. But now we humans continue:

Normally we associate the term “robot” with something physical on a production line assembling a gadget, or with the lawnmower that runs in the garden around the clock and always keeps the lawn neatly trimmed. In the investment world there are many names for the same concept: robo-advisory, robot investing, algorithmic trading and AI investing. We ourselves prefer to use algorithmic or mathematical investing for the principle, but accept that “robo” appears to be the word winning internationally. Even our company name signals an acceptance of this.

At Robofunds we use a robot-based approach from start to finish in the process of making and maintaining an investment in a security. Where this is on behalf of an investor, it all begins with drawing up a thorough investment profile, so that we know the client’s preferences, experience, lack of the same, and the client’s risk aversion precisely.

Human involvement on our side is limited to assistance with the investment profile, which can be completed online or in cooperation with us.

The typical course of a robo investment with us is as follows: