Barnes' firm launches roboadvice offer

A new roboadvice solution targeted at investors who do not want to pay for advice is being rolled out in Australia by a firm with links to a New Zealand-based businessman.

Tuesday, July 28th 2015, 6:00AM

by Susan Edmunds

The Australasian Wealth Investments-owned InvestSmart platform was brought to the market last week.

InvestSmart managing direct Ron Hodge said it had a subscription base of 200,000 investors and $1.7 billion in funds under management.

But he said he expected the new offering to grow that significantly.

He said a lot of roboadvice providers were just "product wizards" but InvestSmart wanted to automate the investment planning process.

It includes investors' current assets in any asset allocation calculations.

"We have a strongly held view that roboadvice should not be about selling investment products but rather be a holistic investment management tool that educates investors so they can take control of their own financial destiny and improve their own financial outcomes," he told Australian media.

AWI's former chairman is Andrew Barnes, who is also managing director of Complectus and Perpetual Guardian in New Zealand.

But although he has that New Zealand connection, an AWI spokesman said there were no plans yet to offer the roboadvice product in this country.

"We are all about consolidation in Australia as opposed to going across the Ditch at this stage," he said.

Hodge said the advent of roboadvice offered promise for delivering low-cost accessible investment planning tools to mainstream consumers.

But he said much of what was available internationally so far fell short on delivery, ignoring the client education aspect of advice.

"Excessive focus on the end product and lack of a broader educational component are all issues that can limit the value of robo-advice for self-directed investors – or at the very least mean it should be taken with a significant health warning.”

Barnes could not be reached for comment.

Tags: Perpetual Guardian roboadvice