A Robo Advisor is a digital platform that provides automated financial planning and investment management advice without the use of human financial planners.
It uses algorithms, based on the user’s input regarding their financial situation and future goals, to offer advice and/or automatically invest the client’s assets.
In this article, we have grouped together the best platforms for investing through Robo Advisors.
To compile the ranking, we have taken the following factors into account:
- The quality of the robo advisor platform
- The investment possibilities offered
- The fund management fees
What are the best robo advisor platforms?
Below our curated list of the best robo advisor platforms, with details of features and characteristics.
Trading 212
For a flexible robo advisor experience
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Regulations:
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Avg. EUR/USD Spread:
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Platforms:
About Trading 212
Trading 212 is a global online broker founded in 2004, offering commission-free trading on stocks, ETFs, forex, and CFDs. Trading 212 provides proprietary web and mobile platforms. Trading 212 is regulated by multiple authorities including FCA, CySEC, and FSC. Trading 212 is known for its user-friendly interface, educational resources, and fractional share investing. Trading 212 serves over 2 million clients worldwide. The Trading 212 CEO is Mukid Chowdhury since 2024.
Trading 212 Features
The features of Trading 212 are listed below.
- Robo-advising on Trading 212 is done through the creation and sharing of customised portfolios.
- Trading 212 portfolios, called aerograms, can be built by adding stocks and ETFs.
- Once an aerogram has been created on Trading 212, you can automate it according to time and money parameters and even rebalance it according to your preferences.
- Your aerogram can be copied by others, or you can copy those of professionals for a robo-advising experience.
Trading 212 Pros and Cons
Advantages of Trading 212
The advantages of Trading 212 are listed below.
- User-Friendly Interface
- No Commission Trading
- Wide Range of Assets
Disadvantages of Trading 212
The disadvantages of Trading 212 are listed below.
- Limited Research Tools
- High Forex Spreads
- Lack of Advanced Features
Interactive Brokers
Large number of robo advisors to choose from
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Regulations:
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Avg. EUR/USD Spread:
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Platforms:
About Interactive Brokers
Interactive Brokers is a global electronic broker founded in 1978, offering trading in stocks, options, futures, forex, bonds, ETFs, and cryptocurrencies across 150 markets in 33 countries. Interactive Brokers provides advanced trading platforms, low commissions, and access to a wide range of financial instruments. Interactive Brokers is known for its sophisticated technology and serves both retail and institutional clients. Interactive Brokers is regulated by multiple top-tier authorities worldwide. The CEO of the Interactive Brokers Group is Milan Galik.
Interactive Brokers Features
The features of Interactive Brokers are listed below.
- Interactive Brokers offers Robo Advisors through their Interactive Advisors section.
- You can start investing in IB’s Robo Advisors with $100.
- IB makes available over 30 Robo Advisors on 7 different markets and factors.
- By answering a few questions, IB will also allow you to create a customised Robo Advisor for the user.
- Asset management fees range from 0.05% to 1.5%.
Interactive Brokers Pros and Cons
Advantages of Interactive Brokers
The advantages of Interactive Brokers are listed below.
- Low Trading Fees
- Advanced Trading Tools
- Wide Market Access
Disadvantages of Interactive Brokers
The disadvantages of Interactive Brokers are listed below.
- Not user-friendly
- No MetaTrader Support
- Additional Fees
Saxo
Robo advisor for professionals
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Regulations:
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Avg. EUR/USD Spread:
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Platforms:
About Saxo
Saxo is a Danish investment bank and online trading platform founded in 1992. Saxo offers trading in forex, stocks, CFDs, futures, options, and other financial instruments across global markets. Saxo provides proprietary trading platforms and white-label solutions for institutional clients. Saxo is regulated by multiple authorities including the Danish FSA and UK FCA. Saxo serves retail and institutional clients in over 170 countries. The Saxo CEO and co-founder is Kim Fournais.
Saxo Features
The features of Saxo are listed below.
- Saxo offers a Robo Advisoring service to its institutional clients and partners.
- The Robo Advisors offered are designed and constantly rebalanced on a client basis.
- Portfolios created by Saxo are created with insights from BlackRock, Morningstar, and NASDAQ.
Saxo Pros and Cons
Advantages of Saxo
The advantages of Saxo are listed below.
- Regulation and Trust
- Extensive Product Range
- Advanced Trading Platform
Disadvantages of Saxo
The disadvantages of Saxo are listed below.
- High Minimum Deposits for Premium Accounts
- Lack of Spread Betting Options
- Custody Fees in Certain Regions
Darwinex
For Robo Advisors created by users
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Regulations:
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Avg. EUR/USD Spread:
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Platforms:
About Darwinex
Darwinex is a global broker and asset management company founded in 2012, offering trading on forex, CFDs, stocks, and other financial instruments. Darwinex provides MetaTrader 4, MetaTrader 5, and proprietary platforms. Darwinex is regulated by the FCA in the UK and CNMV in Spain. Darwinex is known for its unique DARWIN assets, which allow investors to copy successful traders’ strategies. Darwinex recently launched Darwinex Zero, a subscription-based trading platform. The Darwinex CEO is Juan Colón.
Darwinex Features
The features of Darwinex are listed below.
- Darwinex makes it possible to create and share Robo-Advisors called Darwins.
- Users can create their own Darwins, and allow other traders to use them.
- The minimum deposit to start using Darwinex starts at $500.
Darwinex Pros and Cons
Advantages of Darwinex
The advantages of Darwinex are listed below.
- Access to Seed Capital
- Flexible Trading Environment
- Advanced Risk Management Tools
Disadvantages of Darwinex
The disadvantages of Darwinex are listed below.
- Monthly Subscription Fees
- Not user-friendly
- Performance-Based Limitations
Moneyfarm
- Moneyfarm offers an easy-to-use robo advisory service.
- You can start with as little as $100, and the money can be invested automatically in different portfolios.
- Moneyfarm charges commissions from 0.60% on the total value of your investments.
- A minimum of $5000 initial investment is required to start with Moneyfarm.
Tinaba
- Tinaba offers a robo advisory service in collaboration with Banca Profilo.
- To start using Tinaba’s Robo Advisors you need to invest at least $2000, and then at least $50 for the following deposits.
- In total there are 8 Robo Advisors on Tinaba built on portfolios containing ETFs.
- Robo Advisors take ESG factors into account.
- Tinaba charges fees ranging from 1% to 0.40% depending on the amount of money invested.
Gimme5
- On Gimme5 you can start investing with robo advisors from $5.
- Gimme5’s robo advisory service is offered in collaboration with Vanguard.
- The robo advisory solutions offered by Gimme5 take ESG criteria into account.
- Commissions on total assets start at 0.60%, while annual robo advisor fees range from 0.10% to 0.20%.
SoFi
- SoFi is a US SEC-regulated company that offers numerous investment options, including Robo Advisors.
- SoFi’s Robo Advisors can be chosen based on 6 risk parameters, from the most conservative to the most aggressive.
- SoFi’s Robo Advisor portfolios are updated and rebalanced quarterly.
- You can join SoFi for as little as $1.
Wealthfront
- Wealthfront is a US company specialising in long-term investments and robo advisors.
- Today it manages over USD 28 billion with over 490,000 clients.
- Wealthfront offers different portfolios and allows up to 3.30% interest per year.
- With a few questions Wealthfront will build a customised portfolio for each client based on their funds, goals and risk appetite.
- The fees are very low and are 0.25% per annum on funds.
How much money should be invested in Robo Advisors?
With the leading Robo Advisors, it is possible to invest sums of less than $100. However, the initial deposit required to activate the account may vary depending on the service.
| Robo Advisor | Minimum initial investment | Following investments |
|---|---|---|
| Moneyfarm | $5000 | $100 |
| Tinaba | $2000 | $50 |
| Gimme5 | $5 | $5 |
| Interactive Advisors | $100 | $100 |
(your money is at risk)
However, robo advisors are portfolios created to allow one to enjoy compound interest over the long term.
Therefore, more than the initial amount, it is important to minimise commissions and commit to investing a fixed amount (even a low amount) in order to get the most out of the automatic portfolios offered by the platform.
Below you will find an example table that takes into account the average annual interest (APY) of 3%, and the compound interest depending on the monthly deposit from zero.
| Monthly Investment | After 1 year | After 10 years | After 20 years |
|---|---|---|---|
| $ 10,00 | $ 121,97 | $ 1.400,91 | $ 3.291,23 |
| $ 50,00 | $ 609,84 | $ 7.004,54 | $ 32.912,28 |
| $ 100,00 | $ 1.219,68 | $ 14.009,08 | $ 16.456,14 |
| $ 500,00 | $ 6.098,40 | $ 70.045,39 | $ 164.561,38 |
| $ 1.000,00 | $ 12.196,80 | $ 140.090,77 | $ 329.122,75 |
Robo Advisor vs Copy Trading: main differences
With Robo Advisors you automate one of the fixed strategies set by the investment platform, while with Copy Trading you copy the independent strategies of other traders and investors.
Another difference is the commissions. Robo Advisory services are like investment funds, in fact, they charge annual fees based on the total amount in the account. Sometimes they also charge commissions for rebalancing portfolios.
Through copy trading services, on the other hand, you copy other people’s trades and bring them proportionally back to your own investment account. Then commissions such as spreads or commissions for connecting to stock indices will be applied, as if the person copying was trading in the financial markets themselves.
Costs and taxes on returns from Robo-Advisor
Robo-advisors generally only charge a single fee for managing the assets and the robo advisory activity.
This commission averages 1% per annum on the funds under management and is used to cover various expenses such as the work behind the rebalancing of automated portfolios and the business infrastructure.
Choosing a platform that charges low commissions on robo advisors is important, as this type of business generates low returns on average compared to other forms of investment.
If on average, a robo advisor’s return hardly exceeds 3% per annum, charging commissions shrinks the profit margin even further.
For example, a 3% annual return on 1,000$ is 30$, but by applying a 1% commission on fund management, the gain would drop to 20$.
Furthermore, one has to consider that there’s the capital gain tax which depends on your country of residence. This means that at the end of the investment path, when the user wants to liquidate and withdraw the money from the platform, he or she will have to take into account that a certain percentage of that will be taxed.
If the robo advisory platform acts as a tax withholding agent, the percentages withheld could then be even higher than 1% because within that percentage will be not only the management costs, but also the taxes that the platform will have to pay directly to the state.
| Events | Gain/Expenditure | Gain/Expenditure (%) on yield |
|---|---|---|
| Initial investment | +1.000,00$ | – |
| Annual yield 3% | +30,00$ | +3.0% |
| Operating costs 1% | -10,00$ | -33,33% |
| Capital gains tax 26% | -5,20$ | -17,33% |
Taking commissions into account is therefore very important when investing in robo advisors, as annual management costs would add up.
As they add up, they not only affect the fixed annual costs, but also affect future returns because they reduce the amount of money on which compound interest works.
If we consider a monthly deposit of $1,000 for 20 years with annual interest at 3%, at the end of the investment path we would have invested a total of $240,000, which in purely theoretical terms becomes $329,122 with compound interest.
However, the 1% annual management costs would lower the total figure to $293,081 which corresponds to $36,041 in lost earnings.
If the management costs were much lower, such as 0.3% annually, the profit margin would be much higher as with the same dynamics one would lose “only” $11,121 in fees.
Pros and cons of Robo Advisors
Pros
- No trading skills required because they are managed by the platform
- Generally low start-up costs
Cons
- Relatively low interest compared to that which can be obtained by trading in person
- High average commissions in most cases