In recent years, much of the growth has been concentrated among robo-advisors that are owned by major distributors. Currently, around 14 brokerage firms have their own digital-advice platforms, up from six at the start of 2017, says Sean McDermott, a project manager at Corporate Insight. Of the 10 firms on Ignites’ list, three fit this description.
“Incumbents saw how successful Schwab and Vanguard were and decided that this was something they wanted to get involved in,” McDermott adds. “It’s become a relatively low-cost, cost-efficient way to tap into a new business model and new customer segments.”