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Hougan, Lydon Talk ETF Growth, Robo Advisors

ETFtrends.com

ETF.com President Matt Hougan joined ETF Trends Publisher Tom Lydon at the ETF.com Inside ETFs conference in Hollywood, Fla. to discuss the growth of the ETF industry and the up-and-coming robo advisor wave.

“Think about the service they’re offering,” Hougan said of robo advisors. “You get a well-diversified portfolio customized to your risk tolerance managed by Burton Malkiel at Wealthfront that’s tax-loss harvested, rebalanced and they charge you 25 basis points. If that’s the value of asset allocation, you (advisors) have to build other services around your business to maintain that 1% margin.

In 2014, Charles Schwab announced Schwab Intelligent Portfolios, a digital advice platform that the company plans on making available to its retail investors starting this year.

Hougan and Lydon also discussed the advantages of currency hedged ETFs and how advisors can prepare for the possibility of an interest rate hike from the Federal Reserve.

Watch the video below to see the full interview.

To view past video interviews, visit our video section.