Wealthfront launches Bridgewater look-alike risk parity strategy

prnewswire.com

4 pointsblobbers2 comments

This is a big deal in the sense that wealthfront started out as a fairly dumb unsophisticated asset manager, but has since added tax loss harvesting, factor models and risk parity strategies at a fraction of the typical active management fees (2% AUM / 20%+ profit)

Some big pension funds / institutional investors are going to have to start asking themselves if it is worthwhile to pay the fees to some of these active managers if wealthfront is willing to implement these types of systems for free.

Note: there is a little fee so it is not quite free.

>>>Risk Parity will increase the weighted average annual expense ratio of your portfolio by about 0.08% annually. This reflects a reduction of your existing ETFs in your investment mix and the addition of Wealthfront’s Risk Parity mutual fund, which has an expense ratio of 0.50%. The allocation to Wealthfront ‘s Risk Parity mutual fund will not be greater than 20% of your portfolio. There is no change to Wealthfront’s 0.25% annual advisory fee

https://support.wealthfront.com/hc/en-us/articles/3600001180...

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