micobo GmbH| Robo Advisory Update March 2019

English Version

01.03.2019 Key figures of the market leader Scalable Capital

At the end of 2017, Scalable had EUR 640 million assets under management. Of these 640 million euros, sales of 1.2 million euros were generated by fees. Turnover at the end of 2018 was approximately EUR 4 million, with around EUR 1.5 billion in customer funds under management.
However, due to the strong growth course, the company is still in deficit and has made a loss of about 14 million euros since its start and until the end of 2017, with a further loss of about six to seven million euros expected for 2018.
Other interesting figures include the estimate that 140 euros per new customer is spend as marketing expenditure, with an average investor investment of 35,000 euros generating around 126 euros in turnover for Scalable. Furthermore it is to note, that the business in Great Britain is relatively irrelevant with a turnover of only 65,000 euros in 2017.

Link to article

02.03.2019 Oskar as new Robo Advisor for children

Oskar is a new digital asset management solution that aims to provide an investment and savings opportunity for children. Savings plans are possible from 25 euros per month and one-off investments starting at 1,000 euros, whereby investments are made in a broadly diversified ETF/ETC portfolio. In addition, a free payout plan is to be offered in future.
Five different investment strategies are available, which invest in different proportions in equities, bonds and commodities. The compositions strongly influences risk and return, whereby a high proportion of equities implies a correspondingly higher risk. For example, 90 percent of the product Oskar 90 is invested in equities.
For children a special access can be used, which only helds reading rights. The portfolio can generally be viewed via browser or app.
Fees of 0.8 percent p.a. are charged for investments over 10,000 euros and 1 percent p.a. for investments under 10,000 euros. Additional external product costs amount to 0.14 percent p.a.

Link to provider

Note of the micobo editorial staff: In principle, such offers for wealth creation of children make sense and are welcomed. However, the question is to which extend these specialized providers differs from the others on the market. Oskar ultimately offers a simple ETF portfolio with five different investment strategies. Although the savings plan amount and the minimum one-time investment sum are relatively low, they can also be found with other providers. In addition, the costs charged for such a portfolio are comparatively high. However, we can praise the apparently high level of transparency, the specific access for children and the good contact opportunities.
It should also be mentioned that the asset management is taken over by Scalable Capital, to which a large part of the fees charged (0.325 or 0.425 percent of the investment sum p.a.) flows to.

18.03.2019 New products reduce fund costs at Quirion

The popular Robo Advisor Quirion of the Quirin Bank, which was rated very positively in various tests, reduces the fund costs of its portfolios — with corresponding positive effects on the potential returns of the investor portfolios. Without having to make significant changes to the orientation of the portfolios, the costs could be reduced from 0.23 to 0.29 percent to 0.20 to 0.22 percent p.a. by changing the composition of the products used. This means an overall reduction in fund costs of around 20 percent.

Link to article

29.03.2019 Prospery discontinues offer in Germany

At the end of May 2019, the Robo Advisor of the Dutch ABN Amro will withdraw from Germany and consequently no longer offer his asset management here. Even though the product is seen as competitive and innovative, it does not seem to have found a good distribution channel, so that the current growth in client numbers and thus the assets under management do not justify a continuation.
For an economic continuation of the offer in Germany considerable additional investments in sales and marketing would have been necessary, which, however, one would not want to raise for strategic reasons of the shareholder ABN Amro.

Link to the article

Note of the micobo editorial staff: Besides Prospery, Werthstein, N26 and Sina (Santander) have also discontinued their services in the recent past. The German market for Robo Advisory is thus at the beginning of a consolidation phase. Even if numerous new providers continue to enter the market, it can be assumed that ultimately only those Robo Advisors will survive in the long term which are particularly competitive, have unique selling points and can acquire sufficient new customers and assets

About micobo GmbH

micobo GmbH is a leading European software company for Security Token Offerings and Blockchain software development. micobo offers fully compliant software solutions for Security token Offerings and advises on the structuring of DLT- and Blockchain-based securities.

Kai Lorberg is a consultant at micobo GmbH. You can reach him by e-mail (kl@micobo.com)

Homepage: https://micobo.com

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