Betterment has recently announced that they are collaborating with Fidelity to provide RIAs a digital robo-advisor platform. This partnership creates a potential link between the algorithmic asset allocation services of Betterment and the personal relationship services of nearly 3,000 registered investment advisor firms.
Betterment has created a new product called Betterment Institutional which is a white-label version of Betterment's robo-advisory services. They have since teamed up with Fidelity Institutional Wealth Services (IWS) which is a business unit of Fidelity Investments®. IWS provides custodial, brokerage, and trading services to nearly 3,000 RIAs.
This is big news for the robo-advisory industry as it signals the first attempt at offering robo services to the broader investment advisory community. Betterment's thought is that it can sell the service of automated asset allocation to investment advisors, freeing them up to spend more time on the most important part of their business - their relationships. If an advisor was able to spend more time cultivating relationships as opposed to focusing on asset allocation, this could be a valuable proposition.
It remains to be seen how successful this venture will be, but this relationship should further increase the visibility of robo-advisors to the financial community as a whole.
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There are many roboadvisors to choose from; each with distinct characteristics and a wide variety of services offered. We break down the similarities and differences between these firms here at The List.