Login Request account
Reset your password

Investing puts capital at risk

Where do you want to sign in to?

Or your simulation account

Small data, big difference

June 2nd 2017

I think the reward for conformity is that everyone likes you except yourself.

Rita Mae Brown

We are often asked what makes ETFmatic different. Offering asset allocation as an investment solution is after all incredibly common. In fact most, if not all, wealth managers do exactly that. Furthermore using ETFs to implement said asset allocation takes another step away from any active management and further standardises ones offering. So if everyone is doing asset allocation and using ETFs your service has become commoditized. The only way, most firms think, is then to compete on costs and here is where roboadvisors tend to have the edge over the traditional firms. Using technology, we as an industry, have unbundled many of the costs of traditional firms and have passed the savings onto the consumer. However, if all roboadvisors are doing the same thing and incumbents are fiercely writing big cheques to buy or build technology is this not just a race to the bottom in fees? How can one possibly standout in your offering?

Remember to always be yourself. Unless you suck.

Josh Whedon

Most investment firms offer you one of five portfolios and then fiercely market themselves as offering tailored investment solutions. In fact most firms, both traditional and even some roboadvisors, even charge you high fees for this “tailored solution”. The way ETFmatic was created and still continuously evolves, is to develop a technology stack that offers truly bespoke investment solutions. This is evident in our three portfolio management styles that allows our customers to create and have managed any asset allocation that they can come up with. However we also believe that using technology around an investment solution is not enough. Yes, it can be used to unbundle costs for the benefit of the consumer, however technology can also be used to build truly personalised individual experiences. We are staunch proponents of both the former and the latter.

Big data is all the rage these days. We often find ourselves at events and conferences speaking with management consultants and investment analysts who like to add this jargon to their arguments. [We are not entirely convinced they know what the term means, have created the most basic array to iterate over a few lines of data in any programming language or have actually read any papers on it. However we digress]. Therefore we will refrain from using big data in this post. However, we wanted to highlight how we at ETFmatic use data to enhance your investment experience with us.

If you are not paying for it, you're not the customer; you're the product being sold.

Andrew Lewis

You are not our product

First it is important to address the elephant in the room. Investing and dealing with money is extremely personal for all of us. Combining these emotions with the idea that our usage is being tracked, monitored to be profited from can be, and rightly should be, anathema to most people. Most free digital service that we use today do have business models that offer your data (personal, professional, actions, decisions and interests) as a way of making money. Advertising to you or selling your data earns large amounts of money for many firms.

It is important to note ETFmatic is a discretionary investment manager. We expressly and solely earn money by charging you a straightforward investment management fee for managing your money. We are completely transparent in what and how we charge you. Therefore, any information we gather and use to provide you with better information, data, rewards, prompts and assistance is solely aimed to improve your investment experience. We like to to think of this as small data. Rather than big data which is often mined to be profited from, we use this small data to create unique and tailored experiences for you. Therefore not only offering tailored portfolios at the lowest fees possible, but also providing a truly personalised online experience is where we think we differentiate ourselves.

In order to be irreplaceable, one must always be different.

Coco Chanel

Serving clients in 32 European countries is a huge privilege. We see incredibly interesting data from the many regions and nationalities that use our service in a variety of different ways. Below are just a few of the ways we use this data to help create a personalised investment offering for you:

  • We publish periodic customer insights to help you understand how your peers and contemporaries are investing their money to assist you in making your own investment decisions
  • We started “Learn to Earn” - rewards for education by offering three months of free investment fees for users in simulation portfolios by:
    • Watching videos at our academy
    • Reading our articles in our investor's corner
    • Inviting friends and linking their LinkedIn profile
  • We personally reach out to you to help you fund your account
  • We prompt you with warnings when the base currency of the real portfolio you are creating is different from the base currency of your home country
  • We offer financial understanding and personal investor profile questionnaires to help determine your personal understanding, willingness to take risk and assist you in determining which of our three portfolio management styles you want to use
  • We prompt you if the asset allocation you selected is outside of your indicated risk tolerance
  • We track how far your live asset allocation is outside of its tolerance bands and your chosen target asset allocation
  • We periodically prompt you to review your chosen asset allocation to ensure that it still matches your long term investment objective
  • We personally speak with many of our customers to find out how we can make their investment experience better and answer any questions they might have
  • We send out periodic surveys to find out what we can build to improve our service
  • We continuously update your onboarding to highlight and answer the most frequently asked questions we receive in our help section

The tip of the iceberg

This is just some of the data that we gather and use to improve your experience. But it is only the tip of the iceberg. We are improving to provide more personalised information, education and data to you. Here are just three things you can look forward to shortly:

  • Today we launched additional payment information in your personal dashboard to help you fund your account
  • We will be updating our reporting soon to reflect more information in your returns
  • We're developing customised help based on your investment experience

The fact of the matter is that roboadvisors by their very nature have taken a commoditized product (investment management) and have unbundled the costs and made them more commoditized. There are a few ways to differentiate oneself and most firms focus on fees. We would make the argument that we lead the pack on this metric. We also serve 32 European countries in three currencies and offer truly personalised asset allocation. However as important as the above, if perhaps not more so, is that we are constantly building in prompts, education and information to serve you with a truly personalised investment experience online.

If we want to differentiate ourselves in any way. Then this would be it.

With all investments your capital is at risk and the value of your investments and the income deriving from it can rise as well as fall. Past performance is not a guide to future performance.