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Robo Investor: What Is A Robo-Advisor, And How Does It Work in 2023?

If you’re looking for someone to manage your investments, then a Robo advisor could be the answer. In this article, we’ll take a closer look at how Robo-advisors work and how the technology behind them is revolutionising financial management.
Robo and human sealing a deal

What is a Robo-Advisor?

A Robo investor, also known as Robo-advisor, is a type of financial advisor that uses technology to provide automated, algorithm-based portfolio management advice and services with little to no human interaction.
Robo-advisors have become increasingly popular in recent years as more and more people look for ways to save time and money when it comes to managing their finances. While they can’t replace the expertise of a human financial advisor, they can provide a cost-effective alternative for those who don’t need or want the personal touch.

How do Robo-advisors work?

When it comes to investing, there are a lot of options out there. You can go the traditional route and work with a financial advisor, or you can go the DIY route and invest on your own. But what if there was a third option?
Robo-advisors use algorithms to automatically select and rebalance investments in order to stay in line with your stated goals. Also, they take into account factors such as your age, risk tolerance, and investment time horizon to create a personalized portfolio that is designed to help you reach your specific financial goals.

How does a Robo-advisor work in practice?

Here’s a quick rundown:
First, you’ll need to create an account with a Robo-advisor. Once you’ve done that, you’ll answer some questions about your investment goals, risk tolerance, and time horizon. Based on your answers, the Robo-advisor will create a personalized investment plan for you.
Once your plan is in place, the Robo-advisor will automatically invest your money in a diversified portfolio of stocks, bonds, ETFs (exchange traded funds) and mutual funds that align with your goals and risk tolerance. And because these investments are made electronically, they can be managed quickly and efficiently – which means lower costs for you.
Art Robot

Current and Future Applications in Finance

There are a variety of different ways that Robo-advisors can be used in finance. For example, they can be used to help manage investment portfolios, create financial plans, and provide advice on saving for retirement. Additionally, many Robo-advisors now offer features such as tax-loss harvesting and direct integration with employer retirement plans.
Looking ahead, it is likely that robo-advisors will continue to grow in popularity and become even more sophisticated. This will provide new opportunities for individuals and families to receive high-quality financial advice at a low cost. Additionally, as more employers adopt robo-advisory services, employees will have access to an ever-growing suite of tools and resources to help them plan for their financial future.


A robo-advisor is a digital platform that provides automated, algorithm-based financial planning and investment advice. Robo-advisors use technology to provide these services in a more efficient and cost-effective way than traditional human advisors.
If you’re looking for help with your finances, but don’t want to pay the high fees associated with traditional financial advisors, a robo-advisor may be a good option for you. With a robo-advisor, you can get started on your financial goals without breaking the bank.
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Amândio Luís
Amândio Luís