Allianz Ventures, The German insurer’s technology arm, backed by Allianz Global Investors, has invested $7 million (€6.2 million) in robo-adviser MoneyFarm.
The deal indicates that low-cost automated online investment services are making headway in the asset management industry.
Allianz’s investment will help to accelerate expansion in the UK and across Europe, according to the firms, and they cited research by consultancy AT Kearney that predicts the digital wealth management market will grow to over $2 trillion in the US alone by 2020.
Expansion of the digital wealth management market, or robo-advice, is being driven by demands from consumers for one-stop wealth management services combined with the huge cost savings and service levels that wealth managers can achieve through technology, according to MoneyFarm.
While most robo-advisers tend to offer passive products such as exchange-traded funds, it appears that the two companies plan to distribute actively managed funds as part of their offering.
“User friendly technology is not enough without excellent portfolio performance and we are delivering on that count as well,” said Paolo Galvani, chairman and co-founder of MoneyFarm.
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