As turbulent markets and inflation test digital advisers along with the rest of the fintech landscape, the first two quarters of 2022 have shown some robos to be particularly resilient.
Automated investment algorithms that allocated toward value stocks and specific inflation-protection-themed assets stood out from the pack, according to the latest Robo Report from Condor Capital Wealth Management. A classic Wealthfront portfolio and a Morgan Stanley inflation conscious-themed strategy were the best-performing robo-advisers in the year-to-date period ending June 30.
The Robo Report bases its rankings on accounts it has opened with robo-advisers, and the Wealthfront portfolio that performed best is an account it funded in 2016.
Wealthfront’s allocation to the Vanguard Energy ETF (VDE) and Morgan Stanley’s allocations to a commodities ETF and a pipeline ETF were standout contributors, wrote David Goldstone, manager of the investment research at Condor Capital.
Condor’s Personal Capital portfolio also did well in the first half of 2022 thanks to allocations to gold and commodities, the report found.
The worst-performing robos during the first two quarters were Wells Fargo’s Intuitive Investor and TD Ameritrade SRI, according to Condor Capital’s data.
“The most prudent investment one may make is to combine growth-oriented robos with those that have higher allocations to value stocks and inflationary assets,” Goldstone said in a statement.
While 2022 as so far been one of the worst years in history for fixed income, Condor Capital found Marcus Invest, Goldman Sachs’ robo-adviser, took three of the top four year-to-date fixed-income performance spots thanks to a combination of low-duration bonds and municipal bonds, said Thomas Leahy, senior financial analyst at Condor Capital.
While allocations to growth stocks have performed better over longer periods, Wealthfront has outperformed growth-oriented robos over three-year and five-year periods thanks to a 10% allocation to energy. Wealthfront also allocated significantly to municipal bonds, which have helped performance in 2022.
Investment performance along with the digital experience for investors, online planning tools, customization with direct indexing and low fees all contributed to Condor Capital's naming Wealthfront the second-best overall robo-adviser.
"Our investment allocation always takes a long-term view, and the goal is for clients to grow assets steadily and tax-efficiently through various market conditions," a spokesperson for Wealthfront, which was recently acquired by UBS, said in an emailed statement.
However, top honors went to SoFi for including bank accounts, credit cards, mortgages, insurance, self-direct investing, crypto trading, student loan refinancing and digital advice all in its package. SoFi also now offers free access to human financial planners. SoFi did not respond to a request for comment.
Integrated Partners is adding a mother-son tandem to its network in Missouri as Kestra onboards a father-son advisor duo from UBS.
Futures indicate stocks will build on Tuesday's rally.
Cost of living still tops concerns about negative impacts on personal finances
Financial advisors remain vital allies even as DIY investing grows
A trade deal would mean significant cut in tariffs but 'it wont be zero'.
RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.
As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.
