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Financial Advisor, Robo-Advisor or No Advisor?

Earnest, a financial advisor powered by Artificial Intelligence (AI), has been bought by a prominent online investment company. MoneyFarm, a major player in the digital finance industry, revealed that they had bought the personal finance chat robot on the 6th October 2017 and believe that the acquisition will improve the services that they offer. The integration of human and artificial intelligence, envisioned since the publication of Alan Turing’s Computing Machinery and Intelligence in 1950 and the emergence of the earliest conversational software in the 1960s, may revolutionise the way in which financial service providers interact with their customers.

Independent Financial Advisor (IFA).

Navigating the world of finances can be a daunting task for the uninitiated and a lack of knowledge of how the system works can lead to unwise investments, loss of earnings and complications with taxation. Independent financial advisors, regulated by the Financial Conduct Authority and operating without bias or restriction, are available to guide inexpert investors through the financial marketplace and to help their clients make informed investment decisions. Investors who understand the financial market, persons that are unable to afford an IFA or individuals who do not know which financial service provider is most able to meet their needs may opt to make financial decisions without professional guidance.


Automated technology has evolved to the point that a chat robot, or chatbot, can provide financial advice and portfolio management services to investors. Robo-advisors, managing accounts for less money and offering cheaper investment products, can provide financial assistance at a lower cost than their human counterparts. A recent report, drawing on research conducted by BI Intelligence, predicts that AI technology will manage around 10% of the world’s investable assets by 2020. Financial technology is still at an early stage of its development and there is still a way to go before robo-advisors can perform sophisticated tasks such as estate planning, tax management or trust fund administration.

No advisor.

The Global Financial Crisis, occurring between the years 2007 and 2008, led to a lack of confidence in the investment industry and a distrust of financial advisors. Recent research, conducted by Minerva Lending and reported in The Actuary, suggests that investor confidence has not improved in the decade that has passed since the Global Financial Crisis. Few people, however, will be able to navigate the labyrinthine world of investment without the guidance of a financial advisor in either human or digital form. Investment management, like many other industries, may be transformed as artificial intelligence supplants human intelligence in the provision of financial services.


Some investors, feeling more at ease within the framework of a traditional financial services company, would rather have their investments managed by a human than by a robot. Automated financial technology may become the driving force of the investment industry in the coming decades and younger investors, disillusioned by the traditional financial industry, may choose to reject the systems of the past for the technologies of the future.


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