Wells Fargo Launches Robo-Advisor To Attract Young Investors

In order to attract young investors, Wells Fargo & Company (NYSE:WFC) has launched Intuitive Investor — a new digital and low-cost option — aimed to help customers who prefer managing their investments themselves.

This new investment program is a blend of technology and provides access to professional advice from the company’s advisory department. It also seeks to target existing customers of Wells Fargo who are yet to open an investment account.

People can start investments under Intuitive Investor with a minimum of $10,000, which will be managed at a minimal annual advisory fee of 50 basis points (bps). The existing customers will be eligible for a discounted advisory fee of 40 bps upon linking their brokerage accounts with Wells Fargo’s relationship checking program, Portfolio by Wells Fargo.

The new technology will recommend portfolios based on customers’ response to a small questionnaire. Also, the robo-advisor would provide convenient, single-sign-on integration and money movement with Wells Fargo’s online and mobile banking services.

Jon Weiss, head of Wealth and Investment Management at Wells Fargo, said “Significant advancements in technology, changing consumer preferences and evolving demographics inspired us to provide this new, compelling investment experience for our clients.”

Prior to this, the company had introduced several other services this year. In July, it introduced an artificial intelligence chatbot on Facebook (NASDAQ:FB) Messenger, which serves customers’ query directly on social media. Also, in March, it introduced card-free ATMs across its entire network in the United States.

However, Wells Fargo’s Intuitive Investor is not new to the market. Similar products like Charles Schawb’s (NYSE:SCHW) Intelligent Advisory and Bank of America’s (NYSE:BAC) Merrill EdgeGuided Investing have existed for some time now and provide services at a cheaper rate.

Amid the pending investigations and legal hassles, Wells Fargo’s digital innovations might come as a silver lining and help it get back the reputation it once enjoyed.

Shares of Wells Fargo have gained 2% year to date, underperforming the industry’s rally of 13.2%.

Currently, the stock carries a Zacks Rank #4 (Sell).

A stock worth considering in the same space is Washington Federal (NASDAQ:WAFD) . The stock witnessed an upward earnings estimate revision of nearly 1% for the current fiscal year, in the last 30 days. Its share price has increased 2.1% in the past six months. The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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