Having spent 25 years at the sharp end of servicing hedge funds, heading up global prime finance for the most successful banks and funds at the time, Nicholas Roe is back in the city with a FinTech launch, SelfieWealth, a robo-adviser aimed at investment professionals.
Roe (pictured) is CEO of the new firm whose founder is Edoardo Narduzzi, a self-described serial technology entrepreneur. This is the first pure robo-advisory programme to be authorised by the FCA.
The firm was initially launched in Narduzzi’s native Italy last year and has 2,000 users in Italy, while early April’s launch in the UK has seen what Roe describes as ‘a pile of people going through the registration process’.
Explaining his motivation for moving into robo-advice, Roe says: “It was partly driven by intellectual curiosity because it was something I had never done before. Being part of a pure start-up was an exciting prospect.”
The target audience consists of professional investors, under the FCA guidelines, trading their own money and institutions looking for technical research in a post MIFID environment.
The service is based on a subscription model and includes news plus access to the algorithm or robot, nicknamed Alphie, who is the brain at the centre of the business, running every day across 70,000 securities representing every asset class. Alphie is recalibrated every week.
“We say: ‘Ask Alphie, let the Robot do the work!’” Roe says.
Alphie is based on time series data and machine learning functionality to remove any possibility of human bias or behaviour in creating an artificially intelligent process. Alphie is self-learning and can work with a client to understand a personal investment style and suggest top picks across a variety of different asset classes or markets.
There is a particular focus on small stocks, due to market research revealing that is something of key interest to institutions and professional investors.
Roe reports other interest from institutions who want a business to business version of Alphie to use for research or a white label version, embedded in their own web sites or in day to day trading.
Another suggestion is to have Alphie as a common sense check on fund managers’ trading signals.
“Alphie is based on two years’ worth of price data run on a daily basis,” Roe says. “The price and trading patterns and trading momentum allows predictions on where prices are going across 15, 30 or 90 days.”
For institutions, the pricing of Alphie is based on the development time and service provided but for professional investors looking to use the robot as a pure robo-adviser, the subscription model comes in at GBP20 a month for one market a year and GBP50 for three, while full functionality in every market under the sun, to quote Roe, comes in at GBP1200 per annum.
