B2B Robo Advisors – Concept, Technology, Practice, Examples, Comparison & more

A B2B Robo Advisor is ideally a digital automated portfolio management platform mainly used by financial advisors. It is popularly termed as “business-to-business Robo-advisor.

Both traditional brokerages and investment advisory firms offer automated investment platforms to improve the experience of their clients.

It is mainly done by integrating the investors in the digital space. Over the past few years, the B2B Robo Advisors have gained a lot of popularity.

Ideally, at first, the concept came up as B2C, and hence it quickly picked up the pace like the retail distribution review in which it made it nearly impossible for investors to minimize the value chain.

Besides this, thanks to the stunning technological development that the investors can now choose to self-serve and also get advisory planning services at a much lesser price as compared to the typical financial advisors.

You need to know the one that amid the wealth management sector even today, one thing plays a crucial role, and that is the concept of human relationship.

Ideally, the main idea here is to hire Robo Advisory services to develop and protect AUM.

Additionally, we cannot overlook the future revenue, so it is essential to retain clients by offering better use instead of replacing the human touch.

There is nothing surprising to know that service providers under this niche are planning to offer hybrid services. With the B2B model, the market is perfectly fit to throw the hats into the rings.

About B2B Robo Advisor

A lot of disruptive innovations are present in the financial industry, currently.

Robo advisory is one such revolutionary technology that aims to offer quick access to financial products at minimum costs to the clients.

The Robo Advisor technology mainly relies on an algorithmic system. It creates a portfolio automatically for its users on the basis of current income, time horizon, user’s risk tolerance, and some other metrics.

Under the investment portfolios, Robo advisors tend to manage taxable accounts and retirement accounts. They are most likely to be restricted to exchange-traded funds (ETFs).

Besides constructing an ETF portfolio, Robo-advisors also help in rebalancing the accounts. They also perform tax-loss harvesting measures for their users.

The initial B2C Robo advisor innovation to a new growing group of B2B Robo-advisor has emerged due to the increasing popularity of automated advisors.

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B2B Robo Advisors in Practice

Ideally, the B2B Robo advisors feature a network of RIAs and brokers, and their main plan is to take advantage of low-cost Robo advisory platforms.

Additionally, they pass on this benefit to their clients also.

The best part is that by incorporating Robo advisors, the typical financial advisors are also able to integrate their clients into the ruling financial industry.

The B2B advisory platforms tend to operate in a plethora of ways, like having a personalized platform that mixes with the operations and also with the requirements of the financial institutions.

The automated advisor is specially designed for the current non-discretionary platform, and it can again partner with financial advisors who can mix the B2B Robo-advisor into their routine operations.

Some Examples of B2B Robo Advisors

A few financial institutions that understand the importance of the great potential of Robo advisors tend to build their own B2B Robo Advisory platform instead of acquiring platforms.

Some of the media also automate tax-loss harvesting and portfolio rebalancing, which can be done regularly.

But the financial advisors do these tasks annually only as they tend to be time-consuming tasks.

B2B advisors tend to use RIAs which don’t have any account service fees, trading commissions, or custody charges.

Instead of competing with typical financial advisors, some of the B2B Robo-advisors are joining hands with the large financial institutions.

It is mainly done to improve the client’s investing experience in portfolios. On the other hand, some of the Robo Advisors choose to lease out some brokerages and advisory firms.

B2B Robo-Advisor vs. B2C Robo-Advisor

There is no hard and fast rule to the workings of B2B Robo advisor. Some companies tend to incorporate both B2B and B2C advisor.

On the other hand, some financial advisors choose to implement only B2B advisors as they charge meager fees from 0% to 0.5% of the account value.

Service and Customization for B2B Robo Advisors

The wealth managers currently are looking forward to hiring Robots which help them in delivering superior service.

No doubt self–service is available, but there has to be some conjunction with the relationship manager, and all the revenues are still given to the human personnel instead of the automated advisor directly.

The catch here is to complement the wealth manager; for example, the Robo advisor could offer unique algorithms to analyze the risk in the portfolio.

Additionally, customization is also a top priority on the list.

Technology and API used by B2B Robo Advisors

Technologies, including APIs and AI, are also playing a significant role in the wealth management Robo advisor platform.

The automated advisor can afford the technological prowess if the remit is extended.

Above all, you need to know that when it comes to using AI and machines to improve the core offering of the robot, then an individual needs to learn about a plethora of things.

Through machine learning, one can learn about assets that complement an individual’s portfolio.

Thanks to the stunning API’s that they can now reach several geographies at once now and also meet the different needs of different individuals.

Above all, one needs to have careful management and even an excellent knowledge of all the geographies. With Robo advisors, there are endless possibilities.

There will a time when external managers would want to feed into a manager’s central banking system, and it could be right in situations where speed and accuracy are essential.

Conclusion – B2B Robo Advisors

No doubt, the Robo Advisors have gained a lot of prominences mainly because they provide outstanding services, which often the financial advisors cannot deliver after it offers operational efficiency, which is making all the difference.

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