Revolut is an account, already used by over 35 million people around the world, to which it is possible to associate cards, both real and virtual, to pay both online and in physical stores. The account and cards can be obtained and managed conveniently from a smartphone. They also allow you to make payments abroad, send money with zero fees, execute and receive transfers and accumulate savings for your projects. The app, through which you can open the account and request the card, then allows you to view statistics on your expenses, carry out currency conversions and monitor international exchange rates. create virtual piggy banks, access cryptocurrencies and much more.
Now there is a new service launched in Italy too: the Robo-Advisor. The new product allows customers to automate investments based on their needs. Once a customer deposits money into their wallet, the Robo-Advisor automatically invests it in the market and continuously monitors and manages the client’s portfolio. The minimum initial investment amount to gain access to Robo-Advisor is very modest: 100 euros. The service is not free. Even if Robo-Advisor is a robot, like any self-respecting manager, it asks for a commission: i.e. 0.75% per year on the value of the managed portfolio.
Diversified investments in stocks, bonds and ETFs
“When customers use Robo-Advisor – explained Rolandas Juteika, Head of wealth and trading at Revolut – their money is generally invested in a diversified portfolio of stocks, bonds and other assets. The specific investments included in client portfolios will depend on their financial goals, risk tolerance and other factors they specify when creating their account. The Robo Advisor determines which assets the portfolio should have exposure. Once the asset allocation is determined, we evaluate which ETFs most effectively offer exposure to a particular asset, evaluating factors such as cost, liquidity, size, historical performance, risk and others. Typically, client money will be invested in 5-8 ETFs, depending on the portfolio selected.”
Semi-atomatic instrument but with “human” supervision of performance
Robo-Advisor is a semi-automatic tool that uses mathematical algorithms to evaluate the customer profile taking take into account factors such as risk tolerance, knowledge and experience, financial situation and investment objectives and then allocates the deposited money into suitable financial instruments. However, to ensure the full efficiency of the system there is also ‘human’ supervision that monitors performance.
Performance monitoring
According to Revolut, Robo Advisor is quite good at investing. Performances such as “average annual return”, “maximum withdrawal”, “standard deviation”, “accuracy ratio” are available on the site at the time of subscription. Obviously it doesn’t work miracles: in fact, it starts from 4.3% per year for the most conservative portfolios up to 8.8%. Customers can set up recurring transfers starting from 10 euros to grow your wallet. Robo-Advisor can automatically rebalance client portfolios based on the performance of assets within the portfolio by performing periodic reviews to maintain client risk tolerance and take portfolio allocation into consideration.
Trading Pro is the subscription for advanced traders
For those who don’t need advice there’s Trading Pro, a subscription for advanced traders with discounted commissions, higher order limits, advanced portfolio analysis and a desktop trading terminal. Revolut offers customers access to over 2,200 stocks listed in the US, over 220 stocks listed in the EU and 270 exchange traded funds (ETFs). As for the withholding tax payment, it is not handled. Customers must manage tax obligations independently, based on their country of residence.
This article has been prepared for informational purposes only and does not constitute consultancy or solicitation to buy or sell financial instruments. The information reported is in the public domain, but may be subject to change at any time after publication. We therefore decline any responsibility and remember that any financial transaction is carried out at your own risk.