Robo-adviser investment solution launched in SA
LANCE SOLMS ItransactGO creates personal low cost investment portfolios or retirement annuities that track the market and automatically rebalance
Independent low-cost investment platform Itransact has launched a robo-adviser investment tool in South Africa that anyone can use to invest in exchange-traded-fund- (ETF-) based market portfolios, says Itransact head Lance Solms.
The ItransactGO solutions can be accessed on Itransact’s main site with a smartphone, tablet or PC. Users provide detailed investment information based on modern investment portfolio theory and behavioural science, after which the system performs the calculations and creates a personal investment portfolio to help investors achieve their goals.
The investment tool is an automated tool that invests the subscriber’s money into publicly traded companies based on the information and objectives supplied to the robo-adviser. It is suitable for self-help investors and financially disadvantaged investors and serves as a way for investment managers to gain many new clients and provide investors with services at a lower cost.
“The tool does not rely on any investment house or adviser, and invests users’ money based on the market values, trade statistics and asset classes of the stocks on stock exchanges. This also makes the Itransact robo-adviser completely independent,” says Solms.
The robo-adviser is available to any person, and the investor does not need permanent access to connected devices and can use another person’s phone or connected device to subscribe and invest. The application process is easy and can even use photographs of documents to meet compliance requirements.
Additionally, the ETF model is a low-cost investment model, which means that clients pay very low investment fees, and larger investments will lead to even lower fees, he explains.
“The National Treasury and government have repeatedly called on the investment industry to make low-cost index investing available to all citizens. We listened and have developed this low-cost solution that makes investing in blue chip, institutional-grade savings plans available to everyone.”
The mathematical algorithms that are used by the robo-adviser were created by Itransact’s in-house asset manager and are designed to determine the best assets to match a user’s objectives and investment criteria and then invest in various combinations of ETF funds, typically top 40 index-tracking funds that track the markets.
“After receiving users’ information about their investment goals, the robo-adviser operates autonomously and will reassign investments to the appropriate asset classes if market conditions change.”
Meanwhile, Itransact will use social media, its partner network of financial advisers and brokers and low-cost marketing to advertise the solution, helping to ensure the lowest costs for the low-cost model.
“Our solution is an extra arrow in the quiver of financial advisers and brokers to attract and serve new customers cheaply, as well as for individuals to gain easy access to a low-cost investment service.”
ItransactGO opens new investment possibilities for individuals by making the investment process simple and easy, as well as providing investors with instant professionally managed investment strategies.
The solution provides financially disadvantaged investors, who cannot afford basic financial direction and guidance, with a low-cost, affordable option to participate in blue chip, institutional-grade savings plans.
Further, ItransactGO also offers a free retirement annuity option where investors only pay for the investment solution. Total fees and charges for all the services of the platform, such as investment management, administration, online and call centre services will never be more than 1.14% a year including value- added tax. Larger investments will attract even lower fees, and could even be as low as 0.56%, including value-added tax, concludes Solms.
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