What does AI make of DIY investors?
So while robo-advisers have been around for a while (and, to coin the late, great Ian Taylor, “involve neither robots nor advice”), the more traditional world of real-people financial advice has been making the news recently.
First, Vanguard announced that is closing its less-than-two-years-old financial advisory service. It seems their low-cost, low-frills service wasn’t generating much traction in the UK – even at an attractive 0.50% annual ongoing fee.
Secondly, Citi recently downgraded Hargreaves Lansdown to a ‘Sell’ rating, citing concerns about whether will be able to retain high-value customers “without a meaningful advice offering.”
So it would seem that even sophisticated DIY investors need financial advice, but there are fewer and fewer options available to them. We recognise the contradiction here – DIY investors are often the most cynical about the value created by advisers. Hence, we thought we’d ask the undisputed and impartial fountain of knowledge – ChatGPT – about when DIY investors might benefit most from seeking professional advice. Here is what it said: