The first generation of robo-advisors use a method known as “passive portfolio management” to buy and hold a fixed balance of exchange-traded funds. This method relies on price averages in order to match market returns. Vancouver-based online investment service Responsive aims to outperform this first generation of robo-advisors using a data-rich Artificial Intelligence approach.
“Passive investing is a good start, but it ignores the data”, Responsive CEO Davyde Wachell explains.
Google’s AlphaGo AI has been racking up wins against humanity’s best Go players. Go, a chinese board game, was long considered by AI-experts as a watermark test for AI superiority. Responsive intends to use the same technology to succeed in the financial markets, where robo-advisor platforms such as Wealthfront, Vanguard Personal Advisor Services, and Schwab Intelligent Portfolios currently dominate.
“Investors are asking, ‘If Amazon can recommend me products, Apple has a digital assistant, and Google makes self driving cars, then why can’t my investments be AI-driven?’” says Wachell.
Responsive AI-driven investment service is opening a private beta and will be available this August to the public.
“I’m excited to democratize access to AI-driven investing,” says Responsive CIO Thomas Holloway. “With complex market volatility, you have to use machine intelligence in your strategies to make a difference in long-term portfolio value.”
The Responsive AI platform is used by partner Genus Capital to help manage over $1.2 billion of institutional and private wealth.