MutualFundWire.com: Roboadvice Plus Mutual Funds? Bettinger Says It's Coming

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Wednesday, November 11, 2015

Roboadvice Plus Mutual Funds? Bettinger Says It's Coming

ETFs dominate inside roboadvisor portfolios, yet Walt Bettinger sees mutual funds breaking in, at least when it comes to Charles Schwab's direct- and advisor-friendly take on roboadvice.

Walt Bettinger
Charles Schwab
President, Chief Executive Officer

"There is opp with that engine," Bettinger, president and CEO of Schwab, said in Boston in the opening session this morning at the RIA custodial giant's 25th IMPACT conference. "We can take that engine and build it such that you can use MFs."

Bettinger was being interviewed onstage by Bernie Clark, executive vice president of advisor services at Schwab, in front of the more 1,800 advisors and more than 1,500 sponsors at the conference.

Bettinger said he even sees individual securities becoming a part of Schwab's roboadvice programs, Charles Schwab Intelligent Portfolios and Charles Schwab Institutional Intelligent Portfolios (which launched earlier this year). Yet he said he also wonders if the impact of roboadvice has been more overstated than anything in recent years. He even mused that part of the fuss over Schwab's roboadvice programs came from Schwab no longer being a potential buyout option for the other roboadvisors out there.

"There are aspects of that kind of platform that make sense for some clients ... and may make sense helping many of you," Bettinger said. "It's just been so overhyped."

Roboadvice interest is also on the rise among the RIAs that Clark and his team support.

"Last year, 50 percent of you shared that you could see a role for digital advice in your business," Bettinger said. "Today it's 70 percent."

Yet Schwab's RIA allies don't expect roboadvice to take over their business models either. Bettinger said that the 70 percent of RIAs who see a role for roboadvice in their practices only see it as making sense for about 10 percent of their clients.

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