Robo-adviser to reduce 'human error' in investing

Robo-adviser to reduce 'human error' in investing

The co-founder of Gumtree has launched an online investment platform aimed at providing a low cost robo-advice service to investors with smaller sums. 

InvestEngine launched this week with a flat fee of 0.45 per cent per annum and average annual fund costs of 0.17 per cent, with the provider promising no further charges in the hope of challenging competitors in the current robo-advice market. 

Rival Nutmeg charges between 0.45 - 0.75 per cent a year on investments up to £100,000 and 0.25 - 0.35 per cent above £100,000, plus fund costs of an average between 0.17 - 0.19 per cent. 

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Wealthify charges an annual fee of between 0.4 - 0.7 per cent depending on the size of investment, with an average fund charge of 0.22 per cent per year.

The platform is the brainchild of Gumtree co-founder Simon Crookall and his sister Joanna Crookall, chief executive of investment management firm Ramsey Crookall, which backs the new robo-adviser. 

InvestEngine has entered the market championing itself as a competitive option for those with as little as £2,000 to invest, offering a bespoke portfolio and with an accompanying app set to launch in the coming weeks. 

The robo-adviser claims to be the only automated investment manager in the UK which uses a "buy and hold" approach, where an investor buys stocks and holds them over a longer period of time regardless of variations in the market, hailing it as a means to reducing the capacity for human error. 

Mr Crookall said: "After selling my tech businesses, I gravitated back to financial services and I could immediately see there was a real opportunity for a lower cost solution for people with smaller sums.

"Everyday people simply weren’t able to access the same level of money management as people with larger sums."

Mr Crookall said InvestEngine gives investors a "regulated, low cost and easy solution" for taking control of their own investment into "high quality market trackers where all the hard work is done for them".

He said: "We deal with carefully selected exchange-traded funds combined with proven methodology and innovative technology tracking global markets to deliver diversified investment portfolios across countries and markets – essentially people don’t have all their eggs in one basket." 

Mr Crookall added: "The vision for InvestEngine is to become the ultimate destination for investors and savers.

"Over time our offering will diversify and expand to include services like investment advice, pensions, Isas, SME business accounts, current savings accounts, cash management tools as well as ethical investing options with truly green portfolios."

Investors with InvestEngine answer questions about their aims, how much they wish to invest and their preferred level of risk, with the platform then selecting a portfolio of stocks, bonds and other assets. 

There is also an option of topping up an investor's portfolio with monthly instalments.

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