Moneysense’s Jason Heath writing about risk and robo-advisors…
Robo-advisors are not safe. Nor are they risky. A robo-advisor is simply a type of investment company. Like mutual fund companies. And sometimes people irrationally think mutual funds are either safe or risky as well. They are. And they are not.
I’ve been asking myself how robo-advisors clients will react when the next market crash will strike us. I like robo-advisors but I definitely think a lot of people wrongfully think robo-advisors are safe and not prone to market crash.
It’s not the robo-advisor or human advisor who decides how risky your investment is, its your risk profile ! Risky profile = Risky Investments whether they are managed, unmanaged with an advisor or with a robot.
The robo-advisor or the human advisor invest according to your risk profile.
