Note from the Publisher: Market share, market share, market share. All these robos started with high minimum requirements to open a new account, and have rapidly had to lower those minimums in the face of competition from the likes of WiseBanyan ($1 minimum) and Acorns, which literally enables users to invest spare change through its app, and has over a MILLION users signed up at present. Now, pennies in an account doesn’t seem like a big deal, until you realize these are millennials using these apps and as they build brand loyalty and personal wealth, will continue to invest in these platforms as they grow older. So kudos to the robos mentioned in this piece for lowering their minimums, but they may already be way behind the curve. Now profitability……that’s a whole ‘nother conversation.
“LPL Financial’s $5,000 minimum for robo-advisor accounts available through its independent-advisor network highlights a trend that may soon have minimums on robo platforms disappear altogether, InvestmentNews writes.
But industry insiders disagree whether this will benefit or hurt advisors, according to the publication.
LPL is testing its advisor-driven robo, Guided Wealth Portfolios, run on BlackRock’s FutureAdvisor. But lowering minimums began last year with Vanguardwhich cut its minimums in half to $50,000, says InvestmentNews. Since then robo pioneer Wealthfront has followed suit, lowering its minimum from $5,000 to $500, as has Personal Capital, dropping its ante from $100,000 to $25,000.”