Not every robo-advisor is equally suitable for your investment strategy and wealth goals. Some of the digital asset managers differ greatly from each other in their offerings. We therefore explain some critical points that you can use to find the right offer for you.

Active or passive

As already mentioned, a distinction is made between active (full-service) and passive (half-service) robo-advisors.

Full service means that the robo-advisor really takes care of everything. This also includes automatic rebalancing in the event of market changes.

In half-service, this option either does not exist or you have to agree to every change beforehand. This makes the robo-advisor less flexible, but you have more control over your capital.

    Full-service providers: Scalable Capital, Quirion, OSKAR or Ginmon.
    Half-service providers: Growney or Easy Folio

Payment options

This does not so much include the deposit methods offered, as these usually hardly differ from each other. Often PayPal, SOFORT Überweisung or Skrill are offered in addition to bank deposit and credit card. It is more about the possible rotation, i.e. the intervals at which money can be deposited, and the minimum deposit amounts.

The normal frequency is one month, but some providers like https://exnesslatam.com/ also allow payments every two or three months. One-time investments range from EUR 500 to EUR 10,000 and the minimum deposit for savings plans is EUR 25 to EUR 100.

Fees

The fee structure in particular must be viewed critically, as in bad market phases the fees can easily neutralise the entire return.

The fact that two fees are charged by the robo-advisor is normal, since the investment software and the fund/ETF issuer both charge fees. An important distinguishing feature, however, is the form of fees charged by the robo-advisor. Here, either a fixed service fee or a variable performance fee can apply.

Costs based on performance should be viewed critically, especially in high-yield years, as up to 10% of the return can be retained at the end of the year, depending on the provider. Service fees, on the other hand, allow a secure calculation.

Strategy

Most robo-advisor providers weight the individual shares or bonds and regularly reset the portfolio on this basis. This rigid rebalancing, in which the risk of the securities is kept constant, results in a variable risk factor of the portfolio.

Only a few providers, such as Scalable Capital, take the opposite approach and keep the risk of the portfolio constant. For this purpose, the individual securities are weighted differently based on their current risk factor.