Applications of Robo-advisors in FinTech


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Robo-advisors are automated, algorithm-driven financial planning and investment tools. These automated services provide financial solutions after analyzing a customer’s financial goals and positions and managing risks.

The adoption of these advisors is on the rise due to their accuracy, planning, automation, and capabilities.

Let’s look at its booming applications, helping the financial industry to modernize.

Applications of Robo-advisors

1. Asset allocation

Robo-advisors help in asset allocation by using predefined algorithms. These determine the types of asset allocation and decide the most suitable technique based on predefined models.

These automated advisors also help rebalance asset allocation as customers’ investment plans and income can alter. This may lead them to update their investment figures. In such cases, robo-advisors can quickly help with re-aligning their asset allocations.

2. Balance Projection

The automated advisors can project the portfolio balance of users and create strategies according to their investment plans.

It also helps compare different investment strategies and establishes strong and action-driven strategies for users. Thus, users can build a data-driven approach with the use of Robo-advisors.

3. Offer Stock information for Customers

Robo-advisors can help select and offer stocks for portfolios according to the client’s requirement. These bots use AI technologies with a knowledge base to provide information on stocks accurately.

4. A cost-effective option for financial businesses

Financial businesses can become cost-effective by employing virtual assistants to handle all financial requests, both complex and simplified, more efficiently than human advisors. Businesses can use robo-advisors to respond faster to customer requests.

Also Read: Robo-Advisors in Wealth Management

5. Insurance planning

Robo-advisors in FinTech help simplify insurance procedures, from selecting insurance policies to issuing insurance claims. With the help of customer data and their requirements, robo-advisors can suggest personalized insurance policies.

If a customer has existing insurance coverage, robo-advisors can help switch to a similar insurance policy that has other beneficial options regarding funds.


TalkFintech Bureau
TalkFintech Bureau
TalkFintech is focused on the latest financial sector technologies and tools- covering all tech used by banks, investors, insurance, and wealth management sectors- and also conversations on retail financial management tools.


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