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UBS closes robo-adviser SmartWealth to new clients

tabletUBS has closed its robo-adviser SmartWealth to new clients.

A note posted on the Swiss bank’s website says that while existing clients can still log into the service, it would not be accepting any new customers.

The robo-adviser is one of the few in the market to offer regulated advice, placing investors into pre-packaged portfolios based on a user’s financial situation and a series of questions on risk backed by behavioural economics.

The minimum investment was set at £15,000. The total cost of stocks and shares Isa and general investment accounts including own brand funds ranged from 1.12 per cent to 1.29 per cent for a passive portfolio, and up to 1.93 per cent for an active one, according to Boring Money research.

A UBS spokeswoman says that after an assessment the decision was made to close to the service in the UK.

She says the company believes the “near-term potential” of the business is limited.

The spokeswoman says: “We are pleased, however, to have entered into an agreement to sell the intellectual property relating to UBS SmartWealth to SigFig – a financial technology firm that we have an equity stake in and with whom we’ve been working for two years in the US.”

The note posted by UBS on its SmartWealth page

Research from The Lang Cat also placed UBS at the top end of the direct-to-consumer platform market in terms of cost, though the Swiss bank does offer active management from human staff.

Financial News also reports this morning that SmartWealth co-head Shane Williams has been recruited by US quantitative investing house AQR.

Law firm DWF head of financial services regulation Robbie Constance wrote on LinkedIn today that “the next generation engagement play” from UBS made good sense but this was “farewell” for SmartWealth.

How banks are taking on robo-advice

The SmartWealth service came with an app and, speaking to Money Marketing late last year, co-head Nick Middleton backed the bank’s position of continuing to tell clients not to invest with the bank if it was not appropriate.

There were plans to launch a Sipp and Junior Isa account in addition to the five multi-asset strategies SmartWealth launched with.

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Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. Is anyone really surprised? I’m certainly no Luddite, but we all really need to wake up to the fact that not all problems can be solved by automation, IT and AI.

    Much of this is driven by silicone valley and what might work in the US does not necessarily work elsewhere.

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