The streamlining of robo-advisors continues as two more firms have consolidate their respective platforms to better target the retail market.
Earlier this month, New York-based Morgan Stanley announced that it would be moving all of its Access Investing robo-advisor business into its E*Trade from Morgan Stanley side of its business.
Chad Turner, head of E*Trade from Morgan Stanley, said the move will place all of Morgan Stanley’s robo-business under the umbrella of E*Trade from Morgan Stanley’s Core Portfolios.
“You will have all of the digital prowess and capabilities that [E*Trade] brought to the deal and then you have all of the wealth management sophistication and capabilities...and really putting them together,” he said. “We’re using the E*Trade platform as the chassis but then eventually over time we will leverage some of the capabilities of Morgan Stanley.”
Over the next few months, clients will begin to migrate over to the E*Trade brand with Access Investing closing to new customers in December. Turner said it will take time to integrate the Access Investing clients into the new consolidated robo-advisor. He said the firm will unveil a more detailed timeline in the new year.
Many of the unique services that the Morgan Stanley platform offers, such as tax-loss harvesting, will eventually make their way to the E*Trade plan, Turner said. He declined to say how many clients either platform had nor how many assets the robo-advisors manage.
Morgan Stanley’s move follows a similar one by Boston-based Fidelity Investments, which announced last month that it was bringing together its Fidelity Go and hybrid Personalized Planning & Advice robo-advisors. That move takes effect on Nov. 1.
“At Fidelity, we are always evolving our offerings to meet customer needs,” the firm said in a statement. “With this change, we will extend the benefits of Fidelity Go for younger and emerging investors through no advisory fee for accounts under $25K, and provide the coaching and planning of Personalized Planning and Advice at a new lower price for investors with accounts over $25K.”
David Goldstone, manager of investment research at Martinsville, N.J.-based Condor Capital Wealth Management, said the Fidelity move is a consolidation of the brands, whereas the Morgan Stanley move is more indicative of an ongoing trend.
“These firms are looking to really expand the types of products and the type of clients that they can attract,” he said. “Many of these firms have historically been for higher net worth clients [and now] they are trying to acquire or build out a retail investing product suite and that’s where robo-advice fits in.”