A look at how automation is revolutionizing the industry.

Insights: AI in Finance

[MUSIC PLAYING] LISA MARCHESE: AI is a much used term and I think everybody has a bit of a different definition of what it is. AMBER BALDET: A lot of the applications that we see today are really machine learning or even something that's a bit of a precursor to a robust machine learning program, but still very insightful. They offer new kinds of business analysis. SALLIE KRAWCHECK: AI can be a very exciting future for financial services. You think about its use in investing versus what the human brain is able to do. Through the use of technology, we can have more customized investment portfolios better suited to individuals needs, that don't panic in downturns, that I think can do potentially a better job than so many active managers have done for investors today. ADAM WHITE: So using AI well to me is just like any tool. It has to have the right application for the right purpose. And you have to do it in an endeavor to have a better outcome for the customer. Things like machine learning are going to be core to how we develop a product that suits our customer's needs. SIGAL ZARMI: AI has been proven to be a powerful tool. And the way we think about artificial intelligence and machine learning is really across all of our businesses. Not just in our sales and trading operation, but also in our wealth management and investment management operation. MARIE WIECK: I think the whole notion of machine learning accelerating and augmenting human intelligence and learning from patterns quickly is something that we're seeing help in multiple industries. So that you can really add nuance, but with a body of fact. AMBER BALDET: We need to remember, though, that those systems are created by people and inherit the biases thereof. And so we can't simply trust what comes out of a so-called AI system as though it's inherently smarter than us. And we need to constantly be checking that with our view of reality and the world we'd like to create. SALLIE KRAWCHECK: The challenge where AI and one of the things we're addressing, challenge with all technology, and one of the things we're addressing at Ellevest is the inherent bias. GREG BECKER: Machine learning and AI basically looks at historical data. And if historically speaking, industries have been discriminatory, you could end up perpetuating that discriminatory behavior if that's what it's learning from. SIGAL ZARMI: We need to be really careful with what we are asking the machine to do and how we are thinking and evaluating what the machines are doing. HIKMET ERSEK: I think AI information has to be also regulated. I mean, I'm not talking about overregulation. I mean, don't understand me wrong. But it's really misuse of the information has to be regulated in sake of the people. [MUSIC PLAYING]

Insights: How A.I. Continues to Impact Financial Services

Uncategorized

Executives from big financial institutions explain.

A.I. Continues to Impact Financial Services

Executives from some of the world's biggest financial institutions explain.

I much term, and I think everybody has a bit of a different definition of what it is. A lot of the applications that we see today are really machine learning or even something that's a bit of a precursor to a robust machine learning program, but still very insightful. They offer new kinds of business analysis. A. I can be a very exciting future for financial services. You think about it used in investing versus what the human brain is able to dio through the use of technology. We can have more customized investment portfolios better suited to individuals needs. Don't panic in downturns that I think Indio potentially a better job So many active managers have done for investors today using Aye aye well, for me is just like any tool. It has to have the right application for the right purpose, and you have to do it in an endeavor. Thio have a better outcome for the customer. Things like machine learning are gonna be court to how we develop a product that suits our customers need Hey is improving to be a powerful tool, and the way we think about artificial intelligence and machine nothing is really across all of our businesses. No, just in ourselves and trading operation, but also in a wealth management and investment is real information. I think the whole notion of machine learning accelerating and augmenting human intelligence and learning from patterns quickly is something that we're seeing help in multiple industries so that you can really add nuance, but with a body of fact way. Need to remember, though, that those systems are created by people and inherit the biases thereof. And so we can't simply trust what comes out of a so called a I system as though it's inherently smarter than us. And we need to constantly be checking that with our view of reality. And the world would like to create the challenge with a I and one of things we're addressing, I tell you, with all technology and one of the things we're addressing elevates is the inherent bias machine learning it, eh? I basically looks at historical data, and if historically speaking industries have been discriminatory, you could end up kind of perpetuating that discriminatory behavior. If that's what it's learning from, we need to be really careful with what we are asking. The machine to do and how we are thinking and evaluating what the machines doing. I think I information has to be able to regulate it. I mean, I'm not talking about overregulation, right? I mean, you just don't understand the ground, but it's really misused off. The information has to regulate that in sake, off the people.

[MUSIC PLAYING] JEN WIECZNER: Tally specializes in financial automation. You also do some debt repayment. Can you tell us a little bit about how that works? JASON BROWN: Yeah, well, so we're a financial automation company, which means that we are building a service that can do all of your financial thinking and your financial work. And so we started about found and a half years ago building what is now the first and only automated debt manager. And it helps people get out of credit card debt faster and save money along the way. And then we recently added an automated saving service that helps people save towards a goal or build a rainy day fund. And ultimately, what we're working towards is to be able to do all of the financial thinking and work for consumers, so that they can set really big objectives like, I want to be a homeowner. And along the way we're getting rid of their card debt, saving a down payment, improving their credit score, and then eventually financing a home. So it's about being able to really take that emotional and cognitive load off of consumer shoulders and do that in an automated fashion with software. JEN WIECZNER: So walk us through exactly how this works. JASON BROWN: So with Tally, you just download the app, scan in your cards. And then we actually take responsibility for paying your cards for you and then you pay Tally. And the advantage there is anytime we detect you're getting charged interest by the cards, we actually sweep over your balances overnight and move them over to Tally at a lower rate. And we guarantee you're not going to have any late fees. The way our algorithms manage your cards, they get you out of debt quite a bit faster. And our average customer saves over $5,000 in interest. So it's really about taking that burden away, but also making people better off financially. There's really three waves of consumer fintech. The first wave was post financial crisis. And this was the emergence of the online lenders, student loan lenders. And after that came mobile tools. And that's really where we're at right now. So that's where you've got Credit Karma, a lot of the neobanks, online stock trading. And these are just really easy to use mobile tools that you can open up the tool box and do your financial work. The place that it's going is it's going to a world where there's an intelligence service that actually is doing that thinking and work for you. And instead of you having to spend your time and figure out what should I do, it has already figured that out based on your goals. So you just communicate in human language about what you as a person want and then it actually does those things for you. So our view is very strict which is automation means we do all the thinking and work. ROBERT HACKETT: I'm interested in this shift you describe toward full financial automation. But one of the major issues we see in technology right now is you've got these companies like Facebook and Google, and they've got these black boxes. They serve you recommendations and whatever they like. And you don't really know exactly what they're doing, whether it's in your interests or in their interests. So when it comes to financial automation, how can someone be certain that a startup such as Tally is providing the best possible recommendation for them. Same thing for robo-advisors and people making investment choices on behalf of other people. JASON BROWN: Yeah, well, I think it really starts with the business model. I mean, when you have an ad-supported business, your customer is really advertisers and the product is the consumer. And that puts you in a difficult situation because you're not always going to do what's best. If you shift it and say, well, the customer is my customer and I will align my business model with delivering them value, then you bring the incentives in line with each other. So again, taking a look at Tally cards, we only can make money if we're actually saving a customer money on interest. So people who are using Tally that, let's say, don't have any interest charges, they get to use Tally for free and they get all the benefit which we're fine with. But anytime we can see, hey, we can save you money, we're going to do so and then Tally will actually earn revenue. So I think it has to do with just the general focus around what is best for the consumer mathematically and doing that. And I think that's the power of having computers do your financial work. Because let's just take a real human financial advisor. They're supposed to be doing what's best for you, but are they getting fees and incentives from different financial products to nudge you in one direction or another. Whereas, Tally effectively has an auditable log. And every decision that the system made on your behalf, we can justify why mathematically that was the best thing to do at the time. And even 100 years from now when I'm dead and gone, if let's say auditors want to come in and look at what happened, there's actual trail on every single move. So that's one of the things that I get excited about is moving actually away from human advisors into computer systems where you have that kind of mathematical accountability. Because at the end of the day, computers optimize towards goals. And if the goal is make this customer better off, then you really shift the power, if you will, to the consumer. [MUSIC PLAYING]

Insights: How Automation is Ushering in the Third Wave of Fintech

Tally believes it's the future of financial technology.

Automation is Ushering in the Third Wave of Fintech

Jason Brown, cofounder and CEO of Tally, stops by the Fortune studios to discuss the future of financial technology. (November 2019)

specializes in financial automation. You also do some debt repayment. Can you tell us a little bit about how that works? Yeah, well, so we're a financial automation company, which means that we are building a service that could do all of your financial thinking and your financial work. And so we started about four and 1/2 years ago, building what is now the first and only automated that manager. And it helped people get out of credit card debt faster and save money along the way. On Ben, we recently added an automated saving service that helps people save towards a goal or build a rainy day fund. And ultimately, what we're working towards to be able to do all of the financial thinking and work for consumers so that they can. You know, that really big objective, like I want to be a homeowner. And along the way we're getting rid of their card debt, saving it down payment, improving their credit score and then eventually financing a home. So it's about being able Thio really? Take that that emotional and cognitive load off consumer shoulders and do that in an automated fashion with software, so walk us through exactly how this works. So with Sally, you just download the APP scan in your cards, and then we actually take responsibility for paying your cards for you, and then you pay tally and the advantage there is. Any time we detect, you're getting charged interest by the cards. We actually sweep over your balances overnight and move him over. Thio tally at a lower rate, and we guarantee you're not gonna have any late fees. The way our algorithms manage your cards, they get you out of that quite a bit faster. And our average customer saves over $5000 in interest. So it's really about, you know, taking that bird in a way, but also making people better off financially. There's really three ways of consumer fintech. The first wave was post financial crisis, and this was the emergence of the online lender student loan lender. And after that came mobile tools, and that's really where we're at right now. So that's where you've got creditkarma. A lot of the neo bank's online stock trading and these air just, you know, really easy to use mobile tools that you can, you know you can open up the tool box and do your financial work. The place that is going is going to a world where there's an intelligence service that actually is doing that, that thinking and work for you. And instead of you having to spend your time and figure out what should I deal? It has already figured that out based on your goals. So you just communicate in human language about what you as a person once, and then it actually does those things for you. So our view is very strict, which is automation means we do all the the thinking and work I'm interested in this ship you describe toward full financial automation. One of the major issues we see in technology right now is you've got these companies, like Facebook and Google on they've got these black boxes. They serve your recommendations and whatever they like, and you don't really know exactly what they're doing, whether it's you know, in your interests or in their interest. So when it comes to financial automation, how can someone be certain that, uh, start up just stallions providing, you know, the best possible recommendation for them? The same thing you know, for robo advisers and people making investment choices on behalf of other people. Yeah, well, I think it really starts with the business model. I mean, when you have an ad supported business, your customers really advertisers and the product of the consumer, and that puts you in a difficult situation because you're not always going to do what's best if you shifted and say, Well, the customer is my customer and I will align my business model with delivering them value than you. You you bring the incentive in line with each other. So again, taking a look at Calais cards we on Lee can make money if we're actually saving a customer money on interest. So people were using tally that Let's say I don't have any interest charges. They get to use tally for free and they get all the benefit which were fine with. But any time we can see hey, we can save you money, we're going to do so and then Tally will actually earn revenue. So I think it has to do with just the general focus around what is best for the consumer mathematically and doing that, and I think that's the power of having computers to your financial workers. Let's just take a real human financial advisor, right? They're supposed to be doing what's best for you, but are they getting fees and incentives from different financial products to kind of nudge you in one direction or another? Where's tally effectively? Has an auditable log in every decision that the system made on your behalf weaken justify? Why mathematically, that was the best thing to do at the time and even 100 years from now, when I'm dead and gone. If you know, let's say auditors want to come in and look at what happened. There's actual There's actual trail on every single move. So that's one of the things that I get excited about, it moving actually away from human advisers into computer systems where you have that kind of mathematical accountability because at the end of the day, computers optimized towards goals. And if the goal is to make this customer better off than you, really shift the power, if you will to the consumer

[MUSIC PLAYING] JEN WIECZNER: You were once a DJ for Jennifer Lopez. How do you go from that to running a fintech company, Acorns? NOAH KERNER: That's a good question. So I was a DJ as a kid and I worked with a bunch of artists and then Jennifer Lopez, when I was really young. And then after college, I went on and started three different companies, a web company, and music company, and then a product development agency. And after the product development agency got acquired, I started looking at interesting startups in the world that were doing things that I thought were pretty profound. And Acorns was one of those companies. JEN WIECZNER: Tell me what Acorns actually is and how does it work. NOAH KERNER: Yeah, so what Acorns does on a better big picture level is it helps you set aside and invest small amounts of money that you wouldn't have otherwise set aside and invested. So we do that in a couple ways. We do it with our feature called Round-Ups. So every time you make a purchase, wherever you make a purchase, Acorns rounds up the purchase to the nearest dollar and invests the spare change into a portfolio that you've been selected into in our product. You can also set a recurring investment by the day, by the week, or by the month. And so if let's say you do $5 a day, it gets pulled from your bank account. And so it sets aside another small amount of money. We just rolled out a program called Found Money where we partner with specific retail brands and they invest in you as a reward for shopping with them. So if you become an Airbnb host, meaning you're going to rent your apartment as an Airbnb customer and you use the card you have link to Acorns, Airbnb invest $50 into your Acorns account. JEN WIECZNER: For everybody? NOAH KERNER: For everybody. If you sign up for Blue Apron, Blue Apron invests $30 into your Acorns account. Every month, you shop with Dollar Shave Club, Dollar Shave Club invests 10% of the purchase price into your Acorns account. JEN WIECZNER: And do millennials versus older people use it differently or save differently? NOAH KERNER: I mean, so older people tend to have a little more income, so they may contribute a little more. I mean, that's you know-- but we like to get people started as early as possible. Because, of course, the earlier you start, the better off you are in the long term. JEN WIECZNER: Steve Cohen, the legendary hedge fund manager and trader invested $2 million. What has it been like working with Steve Collins from Point72? NOAH KERNER: Point72 has been particularly helpful on the Found Money retail brand outreach, connecting us to people. And we're proud of the fact that someone like Steve Cohen who's a legendary investor would invest into our company. I think it says something about the company. JEN WIECZNER: So is there any research that shows people are more likely to save or that it's easier to invest small amounts of money, just pennies, versus, I don't know, $100? NOAH KERNER: Best research I have is the uptake of our product. We've seen a whole segment of people starting to do things like invest that they hadn't done before. I think some people are thinking about how to digitize parts of the industry that exist. We're thinking about creating a whole new opportunity for a market that didn't have opportunity before. We're in the sort of 75% of America that makes under $100,000 household income. That's who Acorns appeals to. That's the audience that, I think, generally sometimes feels disenfranchised, maybe is overlooked by the financial services industry that tends to focus more on the kind of 1%. I think when you think about what's happened in the country, which has a lot to do with economic inequality or feelings of economic inequality, we're trying to help that group, which is most of America. [MUSIC PLAYING]

Insights: How Acorns Turns Spare Change into Investments

The robo-advisor is run by Jennifer Lopez's former DJ.

How Acorns Turns Spare Change into Investments

you were once a deejay for Jennifer Lopez. How do you go from that To running a fintech company? Acorn? That's a good question. So I was a deejay, is a kid on? I work with a bunch of artist and then Jennifer Lopez when I was really young and then after college, I went on and started three different companies Web Company, a music company and then a product development agency. And after the product of Roman agency got acquired, um, I started looking at interesting start ups in the world that we're doing things that I thought were pretty profound. And acorns was one of those companies. Tell me what acreage actually is. And how does it work? Yes. So what acorn does on a big picture level is it helps you set aside and invest a small amount of money that you wouldn't have otherwise. That is, I didn't invested. Do we do that in a couple ways? We do it with our future called roundup. Um, so every time you make a purchase, wherever you make a purchase, acorns, rounds of the purchase of the nearest dollar and invested spare change into a portfolio that you've been collected into a product. You can also set a recurring investment by the day by the weaker by the month. And so if let's say you do $5 a day gets pulled from your bank account. So it sets aside another small amount of money. We just rolled out a program called Found Money, where we partner with specific retail brands, and they invest in you as a reward for shopping with them. So if you become an Airbnb host, meaning you're gonna rent your apartment, Azan Airbnb customer and you use the card you have linked acorn Airbnb. Invest $50 into your account for everybody, for everybody. If you sign up for blue apron blue apron, invest $30 into your acorns account. Every month you shop with Dollar Shave Club Dollar Shave Club, invest 10% of the purchase price into your account and do millennials versus uh, older people use it differently or save differently. I mean, so older people tend to have a little more income, so they may contribute a little more than that, you know, But we like to get people started as early as possible. Of course, earlier you start the better off you are in the long term. Steve Cohen, the legendary hedge fund manager and trader, invested $2 million. Ah, what has it been like working with the going firm? 0.72 point 72 has been particularly helpful on the found money retail brand outreach, you know, connecting up to people. And we're proud of the fact that someone like Steve Cohen, who's a legendary investor, would invest into our company. I think it's something about the company. So is there a research that shows people are more likely a favor, that it's easier to invest small amounts of money, just pennies versus I Don't know, $100? Best research I have is the uptake of our product. We've seen the whole segment of people starting to do things like Invest that they hadn't done before. I think some people are thinking about how to digitize part of the industry that exist. We're thinking about creating a whole new opportunity for a market that didn't have opportunity before. We're in the sort of 75% of America that makes under $100,000 household income that two acres appeals to. That's the audience, You know that. I think generally somebody feel disenfranchised. Maybe is overlooked by the financial services industry that tend to focus more on the kind of 1%. Um, I think when you think about what happened in the country, which is a lot to do with economics, economic inequality or feelings of economic inequality, we're trying to help that group, Um, which is most of America?

[MUSIC PLAYING] JEN WIECZNER: Betterment now advises 17.9 billion in assets. It's what some might call a robo-advisor. So this is kind of like set it, forget it investing. You invest, go into ETFs, and it's kind of automatically rebalanced. You are also launching into some new products. So tell us a little bit about that. JON STEIN: Right, so what we've been known for is bringing the very best technology to money management, starting with your investments. Everyone knows that we help our customers make the most of their long-term money. But as we've gone down this journey, we've heard from so many customers that to get them further down there, it would help if we could better manage their everyday cash, their everyday money. And if we can help them save a little bit more, that's super impactful. So we're launching both a savings account and a debit card with a checking account attached that I believe will be the best in market of both of these products. The savings account is going to have what is the highest rate in the market. Today, it's yielding 2.69% which makes it by far the highest yielding savings account. The debit card is going to have no fees at all whatsoever, no minimum balance, no fees on any ATMs, no network restrictions, nothing like that, internationally free ATMs as well. So really market-leading products for all of our customers who are looking to make the most of their everyday cash. One of the things that we've done is really intelligently structure this product. So we've negotiated with multiple banks. We're working with a range of banks on the back end just like we do on the ETF side. We're able to choose the best ETF from multiple providers to give the very best value to our customers. And as an independent advisor, we're always working for our customers. We're always working to make the most of your money. A bank only makes money if they pay you less. We're able to get the very best rates in market and we pass all of that onto our customers. And that I believe is extraordinary value that we can provide as the market-leading smart money manager. JEN WIECZNER: So you're not collecting a spread on this? JON STEIN: That's right. We're just passing all of it to you, the customer. JEN WIECZNER: OK, so whatever the bank is paying you, you're then paying the customer. JON STEIN: Correct. JEN WIECZNER: How are you able to commit to it being the highest? Because I think the highest rate on the market right now is offered by your competitor Wealthfront, but you can commit to it being higher than that no matter what even if the Fed lowers rates. JON STEIN: So interest rates are interesting, and they're set by the Fed-- short-term rates are anyway. And all the banks kind of key off of these. And long-term interest rates also key off where people think short-term rates will go over the long term, naturally. Most of the large banks haven't really raised their rates at all even as interest rates have been coming up. They've just been banking that as profits. We're going out with a market-leading rate above the current Fed rate. And even if the Fed moves their rates, our rate will continue to be above that Fed rate. That's how we've structured the contracts which is unique. It's a commitment that we've made to providing the best in market rate for our customers. ROBERT HACKETT: lot of big companies, a lot of big banks, they've been releasing their own robo-advisors. We've seen Fidelity, Schwab. JPMorgan just recently came out with one. And they've been slashing fees left and right. JPMorgan doesn't charge you, I believe, it's on the ETF fees. It waives those fees. So with all of these fees coming down to maybe zero across the board, how will that affect the fees that you take out in your product? JON STEIN: So we haven't seen zero yet. So I think there's a difference between zero and something. The JPMorgan product is at 35 basis points which is more expensive than ours even after you factor in ETF costs. And remember, we're able to choose the best ETFs from all of the providers out there. We don't have any backdoor deals to make money off of ETFs. Every other competitor in the market is either double dipping by offering you their own funds, which they make more money on and which aren't in your best interest, or they have some kind of payment system that's not in your best interest. We only make money on that advisory fee. And that independence means that we're always acting in your best interest in giving you the very best funds. [MUSIC PLAYING]

Insights: Robo-Advisor Betterment Lowers Cost of Investing

The company has a high-yield savings product, too.

Robo-Advisor Betterment Lowers Cost of Investing

The company hopes to entice new customers with a high-yield savings product, too.  (July 2019)

Betterment now advises $17.9 billion in assets. It's what some might call a robo adviser. So this is like said it. Forget it, investing. You invest going T APS, and it's kind of automatically re balanced. You are also launching into some new products, so tell us a little bit about that, right? So what we've been known for is bringing the very best technology to money management, right? Starting with your investment, everyone knows that we help our customers make the most of their long term money. But as we've gone down this journey, we've heard from so many customers that get them further down there. It would help if we could better manage their everyday cash, their everyday money and if we could help them, save a little bit more that super impactful. So we're launching both a savings account and a debit card with a checking account attached that I believe will be the best in market of both of these products. The savings account is going to have what is the highest rate in the market today. It's yielding 2.69% which makes it by far the highest yielding savings account, the debit card is going to have no fees at all whatsoever. No minimum balance, no fees on any A T m, no network restrictions, nothing like that. And internationally create Hamza's well, really market leading products for all of our customers who are looking to make the most of their everyday cash. One of the things that we've done is really intelligently structure this product. So we've negotiated with multiple banks were working with a range of banks on the back end, just like we do on the side, right? We're able to choose the best DTs from multiple providers to give the very best value to our customers and as an independent advisor were always working for our customers always working to make the most of your money. A bank on Lee makes money if they pay, you left were able to get the very best rates in market, and we pass all of that on to our customers. And that, I believe, is extraordinary value that we can provide is the market meeting Smart money manager. You're not collecting a spread on this. That's right. We're just passing all of it to you. The customer. Okay, so whatever the bank is paying you, your than paying the customer correct. How are you able to commit to it being the highest cause? I think the highest bid on the market right now is offered by your competitor Well, front. But you can commit to it being higher than that, no matter what, even if the Fed lowers rates. So interest rates are interesting and they're set by the Fed. Uh, short term rates are anyway, and all the banks kind of key off of these in long term interest rates. Also key up where people think short term rates will go over the long term. Naturally, most of the large banks I haven't really raised their rates at all. Even if interest rates have been coming up, they've just been banking that its profits were going out with a market leading rate above the current Fed rate. And even if the Fed moves, their rates are right, will continue to be above that fed rate. That's how we've structured the contracts, which is unique. It's a commitment that we've made to providing the best and market rate for our customers. A lot of big companies, a lot of big banks. They've been re releasing their own robo advisers. We've seen Fidelity Schwab TV. Morgan just recently came out with one and even slashing fees left and right. J. P. Morgan doesn't charge you. I believe it's on tthe e e t f waves those keys. So with all of these fees coming down to maybe zero across the board, how will that affect the fees that you take out in your product? So we haven't seen zero? Yes. Um, uh, So I think there's a difference between zero and something. The GP Morgan product. Is it 35 basis points, which is more expensive than ours, even after you factor in e t f costs. And remember, we're able to choose the best E t f from all over the providers out there. We don't have any backdoor deal to make money off of E. T. F. Every other competitor in the market is either double dipping by offering you their own funds, which they make more money on and which aren't in your best interest. Or they have some kind of payment, you know, system that's not in your best interest. We only make money on that advisory fee, and that independent means that we're always acting in your best interest in giving you the very best fund.

[MUSIC PLAYING] JEN WIECZNER: There's also robo-advisors. Actually, in the next session, we'll have the CEO of Wealthfront, a robo-advisor that now competes with you. But you also have your own-- OK, but we also have your own-- you have your own robo-advisors, Schwab Intelligent Portfolios. CHARLES SCHWAB: Yeah. JEN WIECZNER: I think it's still about 1% of your overall assets. And about half of your assets are managed by human advisors. So in the end who wins, the robots are the humans? CHARLES SCHWAB: Yeah, so just for clarity, probably about half of our assets are under some form of advisor relationship. But all of those are a mix of technology and people. None of it is pure people. I think the consumer probably wins at the end. Models like a Wealthfront or a Betterment do better for consumers than many consumers could get from an investment advisory model in years past. So I think that consumer wins there. I think programs like our Intelligent Portfolios do better than consumers could typically get in years past. I mean, it's amazing for me to think about the idea that somebody with just a couple thousand dollars can get a fully diversified portfolio, rebalancing, tax-loss harvesting, and have an all-in cost, at least under our program, that's probably measured in a couple tenths of a percent. That's amazing. Maybe it's just because I'm old and been in the business 37 years, but you couldn't even get that 25 years ago. And 10 or 15 years ago, it probably cost you 75 basis points or maybe even 1%. So I think the consumer is the ultimate winner. In terms of smaller firms starting up in the digital advisory space, this issue all just comes down to frame. What is the time frame you're playing on? It's not a matter of, I think, within the companies who wins and who loses. We're playing a long time frame. I mean, we bring in more net new assets every month than those firms have in total. So it's just a different time frame. If your business is financed by BC, there's an exit strategy. And so the frame might be until they're acquired or-- and I'm not saying any of these firms are for sale, but until they're acquired or until some other transaction takes place. That's not our frame. We're playing a multi-decade time frame and investing and trying to build our business under that. But the ultimate winner in all this is the consumer. And frankly, that's great. That's how it should be. 

Insights: Charles Schwab’s Keys to Staying Competitive

How the company incorporates robo-advising.

Charles Schwab’s Keys to Staying Competitive

CEO Walt Bettinger explains how the company incorporates robo-advising into their services. 

There's also robo advisers. Actually, in the next session will have the sea of, well, front row advisor that now competes with you. But you also have your own. Okay, but we also have your own. You have a robo adviser, Schwab intelligence portfolios. I think it's still about 1% of your overall assets and half about half of your assets are managed by human advisors. So in the end, who wins? The robots are the humans. Yeah, so just just for clarity. Probably about half your assets under some former adviser relationship. But all those are a mix of technology and people. None of it is, is your people. Um, you know, I think the consumer probably wins a t. The end models, like a well front or a betterment do better for consumers than many consumers could get from an investment advisory model in years past. Uh, so So I think the consumer wins there. I think programs like are intelligent portfolios do better than consumers could typically get in years past. I mean, it's amazing for me to think about the idea that somebody with just a couple $1000 could get a fully diversified portfolio re balancing tax, lost harvesting and have, you know, an all in cost, at least under our program. That's probably measured in, you know, a couple of 10 of a percent. That's amazing. Maybe it's just because I'm old and been in the business 37 years, But you couldn't even get that 25 years ago and 10 or 15 years ago, it probably cost you 75 basis points or maybe 1%. So So I think the consumer is the ultimate winner, you know, in terms of in terms of smaller firms starting up in the digital advisory space, this issue all just comes down to time frame. What is the time frame you're playing? It's not a matter of, I think, within the companies who wins and who loses. We're playing a long time frame. We bring in more money, more net new assets every month than those firms have in total. So it's just a different time. Frame it. If your if your business is is financed by BC, there's an exit strategy, and so the time frame might be until their acquired or and I'm not saying any of these firms are for sale but until their acquired or until some other transaction takes place. That's not our time frame. We're playing a multi decade timeframe and investing and trying to build our business under that. But the ultimate winner and all this is a consumer and frankly, that's great. That's how it should be.

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