Irish Times Feature re Roboadvice

[Gordon Gekko]

Interesting piece in today's Irish Times around the advent of roboadvisers, and great to see our own Steven Barrett featured.

https://www.irishtimes.com/business...e-robo-advisers-are-coming-1.3029009?mode=amp

My own takeaways are that the 0.85% that was mentioned (albeit as an upper limit) isn't cheap and that the psychological side of investing is huge; when the roboadvised investor has long since pulled up stumps because he/she couldn't hack the volatility, the human-advised investor should generally be still hanging in there.

An interesting article though.

 

[Steven Barrett]

I had a look at the ETFmatic's offering and didn't find it a whole lot different than what is already available.

There will always be DIY'ers who are perfectly happy and confident enough to invest themselves. Then there are people who can't invest with confidence and those who would simply prefer to outsource it and pay someone else to manage their finances.

What the introduction of robo advisors will do is bring up awareness about charges. It will put pressure on salesmen who earn massive commissions on products with high charges for very little advice.


Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)

 

[Boyd]

IMO as long as the gibberish tax laws on UCIT ETFs exist, all of this stuff is a moot point.

 

[Sarenco]

Judging by the ETFs that make up their sample portfolios, I would argue that this offering is actually inappropriate for Irish resident investors. The tax calcs would be nightmarish.

 

[fistophobia]

So, by default these people are wasting their time promoting robo-advisors in Ireland.
Revenue has fixed it for the pensions industry. Makes it so tax punitive to invest in funds outside of any pension tax wrap.
If you have any money to invest you must be wealthy already - tax it at 41%.

 

[Steven Barrett]

So, by default these people are wasting their time promoting robo-advisors in Ireland.
Revenue has fixed it for the pensions industry. Makes it so tax punitive to invest in funds outside of any pension tax wrap.
If you have any money to invest you must be wealthy already - tax it at 41%.

It's a government that sets the 41% tax on gains, not the Revenue. And remember, up until last Budget, DIRT was 41% too although they are not planning to reduce this gradually down to 33%. It's easy pickings for the government as obviously only rich people save money . If they reduced this tax, the austerity lot would be up on arms saying that money should be spent on social welfare.

Where the Revenue have messed up is the taxation of ETF's, taxing them as a mutual fund when they are in fact a tradable share and should be taxed under CGT.

Robo advisers of the scale of Betterment or Vanguard will reach these shores eventually. It's all a matter of scale though, they're not going to rush into a tiny market like Ireland until they are well established in larger markets. I wouldn't say Brexit has helped their cause in that regard.


Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)