Category Archives for General News

The Robo Report – Q1 2024

Condor Capital Wealth Management recently released their Robo Report for Q1 of 2024.  As with all other years we have investigated, the Robo Advisors continue to perform very poorly, compared to the overall stock market.  

In the middle of the Report is a table showing the main Robo Advisor performance for the past 5 years, 3 years, 1 year and Year to Date (Q1).  

Focusing on the SOLID GREEN line, we can see the average annual gain over the past 5 years was only about 6.5%.   

By contrast, the market was up an average of about 14% per year over the past 5 years, which is more than DOUBLE the Robo Returns. 

Here's an image of the Dow Jones Industrial ETF, DIA.

Year after year, the evidence continues to suggest you would be better off buying ANY market index ETF, such as SPY, QQQ, or DIA compared to investing in pretty much any Robo Advisor.  

Once again, we see that Robo Advisors consistently under-perform the major market indices.   As we say here at IFM,  "Returns Matter."  Because they do.

Download The Robo Report:

Visit Condor Capital Wealth Management for archived Robo Reports going back to 2017.  You can also click the link near the top of the page to download the latest edition. 

The Future of the Robo Advisors: ‘A Variety of Investing Styles

Download article from RoboAdvisorsPro.com

In Top 11 Trends of the Robo Advisor Industry (September 2016), industry experts discuss the current trends that are developing in the Robo Advisor space. Some are obvious – the rising impact of regulations in the wake of the Department of Labor’s new fiduciary rules and the move to mobile devices for the delivery of account information and user interaction. And, some are not so obvious, yet, just as impactful. Dr. Kenneth Gustin of Chartis Research Ltd. Says,

“

… in the future, you’ll find a variety of investing styles available from the Robo Advisor, not just a passive, index-fund investment approach. Greater sophistication in the technology for trade analysis, plus back-testing of strategies, will drive these styles forward.”

We agree with Dr. Gustin. Today, nearly all Robo Advisors engage in a passive index-fund approach for their clients. In our experience, this rather simple method has often underperformed the market and led to significant drawdowns in client accounts.

OmniFunds is focused on Probability-Based Investing through the analysis of chart data and inter-market relationships. This focus has already created fund management approaches that significantly out-perform the portfolios offered by most Robo Advisors.

We believe that returns matter to clients a lot more than most Robo Advisors seem to be willing to admit. As users scrutinize their returns, Robo Advisors will begin attempting to gain an edge. It is our belief that the only way to consistently out-perform the market is to carefully select securities that have a high probability of upward movement in the next timeframe (month, quarter, etc.).

Nirvana Systems, Inc., the research and development organization that is building the OmniFunds technology, is currently testing Artificial Intelligence Probability metrics designed to maximize gains and minimize “pullbacks” also commonly known as “draw downs” even more than current methods. These new funds are expected to be available early in Q1 of 2017.