Goldman building robo-adviser to give investment advice to the masses
Goldman building robo-adviser to give investment advice
to the masses
By Olivia Oran Tue Mar 21, 2017 | 9:41am EDT
Goldman Sachs Group Inc (GS.N), known for advising the
world's richest and most powerful, is building a so-called robo-adviser geared
to mass affluent customers, according to a job listing posted Monday on the
bank's website.
A Goldman spokesman declined to comment.
The job posting for employees to help build the platform
(See the job ad here http://www.goldmansachs.com/a/data/jobs/46404.html
) comes as Goldman is looking at ways to broaden its customer base outside the
super wealthy, including making deeper inroads into new consumer-focused
businesses.
The bank last year launched Marcus, its first major foray
into consumer lending, as well as a complementary deposit-taking platform after
acquiring GE Capital's online bank. It also acquired Honest Dollar, an online
retirement savings platform for small businesses and startups.
The robo platform would sit within the bank's rapidly
growing investment management division, according to the ad. The unit, which
Goldman has been trying to build out in recent years to diversify its revenue,
posted a record $1.38 trillion in assets under supervision at the end of 2016.
Goldman has for years grappled with how to tap into the
mass affluent segment, broadly defined as those with less than $1 million in
investable assets, without diluting the brand of its private wealth business
which is considered a jewel within the bank, according to people familiar with
the matter. Goldman's U.S. private wealth business typically advises clients
with an account size of around $50 million.
Goldman has in the past considered expanding Ayco, a
wealth advisory firm it purchased in 2003, as a way to push more deeply into
the mass affluent segment, the people added.
While the robo-advice market was initially developed by
startups such as Wealthfront and Betterment with ambitions of upending the
traditional financial advice sector, large firms such as Charles Schwab Corp
and Vanguard have launched similar services.
Other large firms are partnering with or buying existing
players.
UBS Group AG and Wells Fargo & Co are partnering with
online financial adviser SigFig Wealth Management, while BlackRock Inc acquired
FutureAdvisor.
Morgan Stanley is launching its own robo-advisor later
this year, primarily for the children of its existing clients. CEO James Gorman
has said that firms which combine digital and human advice will be more successful
in the future.
(Reporting by Olivia Oran; additional reporting by Anna
Irrera in New York; Editing by Cynthia Osterman)
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