Some traditional firms embracing digital are choosing approaches that are designed to be less threatening to advisors.

Pershing, for instance, is offering a robo service for advisors, cast as a tool that will help them automate aspects of their business. 

Meanwhile, Capital One’s newest digital advice service is Capital One Investing, a robo-hybrid advisor platform combining automated service with experts clients can speak to.

Pershing, a BNY Mellon subsidiary, is promising several more digital innovations to come this year, says Michelle Feinstein, director of Pershing Client Technology Solutions. “Financial services have been greatly impacted by the pace of technology. We have to make sure all our customers keep pace with all that change.” 

For Capital One investors, they can access the already existing tool belt of digital offerings such as the company’s Sharebuilder, PortfolioBuilder, and RetireMyWay. Clients can also tap a team of financial advisors at a new advice center that is launching in the fall. There are different tiers of service within the new product offering: people would need to invest a minimum of $25,000 for managed accounts while others can invest $200 if they open an online account on Capital One’s PortfolioBuilder.

“There is a clear need for advice -- accessible, transparent, affordable advice -- that complements digital tools and technology. That's what we aim to deliver with Capital One Investing,” says Yvette Butler, president of Capital One Investing.

“Our research has shown most investors don’t fit into one single category (automated, self-directed, advisor-based) and that most want a combination of solutions. We're aiming to provide that in an accessible and affordable way,” Butler says.

For financial advisors who use Pershing’s product, they will have access to a robo advisor that offers rebalancing of portfolios, automated risk profiling and allocation, and other digital advice features, Feinstein says. The robo advisor can be used out of the box or customized according to the their needs.

In addition, Pershing is offering enhanced digital analysis tools, mobile ready apps and a content management platform where clients can read finance articles and advisors can write and publish their own content.

“We have a pretty broad digital strategy. Digital advice is just a small part,” Feinstein says.

For Pershing’s robo advisor, they tapped New York-based Marstone, a financial services business, to provide the tool, Feinstein adds.

“We decided to start with Marstone. One is the flexibility of their technology. We like their clean approach to design and user experience."


As to what's next in automated advice options from Pershing, the company says potential providers are currently being screened.

As to why they are looking to offer multiple robo advisors, Feinstein says it is because Pershing has 1,500 to 1,600 clients and they all have different needs that may be fulfilled by a range of robo advisor providers.

Other established firms have launched their own digital wealth management sideshoots with some of them offering a robo-hybrid model.

These include Vanguard Group’s Personal Advisor Services, which has a $50,000 minimum and has an annual fee of 0.30% of assets under management. Investors have access to a rotating team of financial advisors. Earlier this year, Charles Schwab launched Schwab Intelligent Portfolios, which has no advisory fees and requires only $5,000 to invest. But it has been criticized for hidden costs, most notably by Wealthfront CEO Adam Nash.

Other robo advisor hybrids include upstarts such as Personal Capital and LearnVest, which was recently acquired by Northwestern Mutual.

These developments are in response to the often cited intergenerational shift of wealth from baby boomers to millennials in the next coming decades. User friendly digital interfaces, low prices, and transparency in wealth management offerings are what appeal to millennials, according to several surveys.

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