Take portfolio rebalancing, for example-it just makes sense to use technology to speed up the task of selling and buying when your investments drift out of balance from your target allocation. Yet even when the numbers are cut-and-dried, it helps to have a human touch to override the rules when necessary-for example, if certain investments are attractively priced, it might make sense to buy “on sale,” even if the allocation is not exact.
A human manager ensures the outcome occurs as intended-and that it occurs at all. (Most individual investors do not rebalance. They don’t like selling off some winners and buy the losers, even if it is in line with their long-term goals!) There is no question that automated apps and robo-solutions are huge drivers of innovation and cost-cutting in all industries, not just finance.