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German robo-adviser lands in the UK

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German robo-advice firm Scalable Capital has been granted FCA approval to operate discretionary investment management services in the UK.

Using ETF-based investment portfolios meeting a range of risk profiles, Scalable Capital will reweight the underlying asset allocation based on forward-looking projections and an assessment of ongoing market developments.

Charges will be 0.75 per cent of the average invested capital, including account management and custody fees, as well as all trading costs for portfolio transactions.

Portfolios will be built from a universe of 1,500 ETFs. They are currently constructed using 14 products, which track indices across the four main asset classes – equities, bonds, property and commodities.

Investors can join the waiting list on the Scalable Capital website before the service launches later in 2016. The firm has been operating in Germany since 2015.

Leading the UK team are former Goldman Sachs trading division executive director Adam French and Dr Ella Rabener, the former founder and chief executive of Westwing Russia and associate partner at McKinsey & Company.

Adam French, co-founder and managing director of Scalable Capital says: “Our unique and dynamic risk management technology takes the digital investment industry to the next level. Our technology not only provides cost-efficient access to capital markets products, but also offers UK retail investors a more sophisticated investment methodology.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. How is asset allocation and passive funds in isolation”advice”?

  2. What is the difference between this model others systems on the market?

  3. It still only caters for the already educated and knowledgeable client with experience of investing. Until it can have a personal educational conversation with a client about their own aims, fears, soft emotional influences and desires it is far more “robo” than “advice”…. but if its not execution only then….

  4. Hi gents. We don’t like the term robo-adviser either and would rather call ourselves a digital investment manager. You are right – we don’t offer advice. Unfortunately the industry has used the term robo-adviser as the umbrella term which encompasses a wide range of business models, including online discretionary investment management.

    With regards to our model, we are offering something unique from both the other digital firms as well as the traditional wealth industry. We use risk projections to dynamically adjust the individual client portfolios with the aim of keeping the explicit level of risk (expressed as Value-at-Risk) constant in all market conditions. This has been developed using technology which was previously unavailable to retail investors.

    Remember, as with other investing, your capital is at risk. If you are interested in learning more, please visit our website https://uk.scalable.capital

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