Robo Advisor Vs. iFlip's A.I. SmartFolio
The Difference In Stock Market Investment Accounts
Many people have asked, "What is the difference between iFlip's A.I. SmartFolio and Robo Advisor company products like Betterment, Wealthfront, Wealthsimple...etc?" The answer is that iFlip is NOTHING like these robo advisors or index funds. Robo Advisors use a strategy called rebalancing that utilize algorithms to rebalance your account, which essentially means it performs an automated adjustment of funds...these algorithms they use require no intelligence whatsoever. This type of function would perform the same if a college intern did it. It is just a repeatable algorithm.
iFlip uses A.I. technology to analyze and trade the market for you. What does that mean? In essence the difference is comparable to using a Tesla or a Honda Civic. The Honda Civic can use cruise control, which would keep your car going at a certain mph...but the Tesla would completely drive, protect and control the speed of the car. A.I SmartFolios are like driving a Tesla and Robo Advisors are like driving a Honda Civic. We'll go into the details below.
Explore Our A.I. SmartFolios
What iFlip A.I. SmartFolios Technology Does - Risk Management For Stock Trading Apps
iFlip's A.I. SmartFolio technology uses a complicated analysis on your stock positions (DAILY). This type of machine learning can make decisions to trade on your behalf based on risk and profitable future results. The A.I. SmartFolio acts with intention. It uses the A.I. to analyze risk and will then perform a buy, sell or hold if it sees long term profitable results. This is a done for you solution and does not require customers to understand how the stock market works.
For example, iFlip’s A.I. predicted a dip at the beginning of 2020. Back in the month of November 2019 the A.I. SmartFolio automatically sold a large portion of iFlip's customer positions in the S&P 500 (SPY) as shown in the graph. This saved customers a large portion of their investments because of the sharp losses that took place in the month of February 2020. The S&P500 (SPY) so a -32.72% loss.
What happened? The A.I. SmartFolio "Tactical Model" started to see red flags in the market, meaning risk was increasing at a high rate. This prompted the A.I. SmartFolio to make a decision to sell a large portion of its positions. This sell took place in November and the stock crashed 3 months later in February.
The A.I. SmartFolios are designed to see volatility and risk. Based on the analysis of these factors, it will then buy, sell or hold A.I. investment positions. We do not believe in a crystal ball or knowing EXACTLY what a stock will do in the future. However, we've shown in historical results, it's possible for our A.I. SmartFolios to get close enough to avoid large crash losses. Robo Advisors and index funds rely on the market increasing overtime, which is good if you're okay with mediocre returns and high fees.
On March 17th, 2020, after the crash, iFlip's A.I. SmartFolio bought back into the market when it started a sharp recovery. This shows that the A.I. was able to foresee the market would create a "V" shaped recovery. Where did this A.I. SmartFolio technology come from? The short answer is, this A.I. has been developed over the last 20 years, using over 4 Billion dollars of investment funds. . Kelly Korshak, CTO & Co-Founder of iFlip, along with his team are the architects and genius behind the machine learning systems.
Read more about Kelly Korshak
What Robo Advisors Do - Strategy Called Rebalancing
Companies that use Robo Trading Advisors use a strategy called rebalancing to grow their wealth. This type of strategy uses diversification. They put your money into different groups of stocks to give you a portfolio that is balanced (some bonds and tech stocks). By diversifying your money these companies hope that over time you will make money as the stocks grow in value. Rebalancing comes in when some of your stocks grow more than others. When this happens the Robo Advisor will automatically buys and sells stocks portions in order to get your portfolio back to its original diversified portfolio. Here's an example of rebalancing. This type of strategy doesn't try to avoid risk through analysis or any kind of intelligence.
To Better Understand Rebalancing, See The Following 3 Steps.
Step 1. You invest $200 | $100 in Portfolio A (50% of Investments) and $100 in Portfolio B (50% of Investments).
Step 2. Wait One Month | Portfolio A grows to 150$ (60% of Investments) and Portfolio B stays at $100 (40% of Investments).
Step 3. Robo Advisor Rebalancing | Robo Advisor automatically sells $25 in Portfolio A, changing it to $125 (50% of Investments) and buys $25 of Portfolio B changing it to $125 (50% of Investments).
*Result. Investments are rebalanced | Both portfolios are back to a 50% split of total investment value.
iFlip doesn’t believe that rebalancing is an effective tool to preserve, protect and grow wealth. The key to good returns is investing in what is successful and managing the risk for higher returns. Robo Advisors don't do any of that that.
This is why robo advisors under perform. Currently, iFlip is the only software that gives individuals the ability to use A.I. SmartFolio technology to protect and grow their wealth through automation. It has the power to actually manage the risk for your investments based on A.I. SmartFolio decision making.