Ritholtz Wealth files for new robo-advisor

Ritholtz Wealth Management has launched a new automated digital advice platform, according to documents filed with the Securities and Exchange Commission.

The new robo, called Good Advice Automated Wealth Management, guides clients through the entire investment process, encompassing asset management and financial planning, according to the SEC filing. Good Advice requires a minimum $15,000 balance and will charge a maximum fee of 0.50% of assets under management.

Like other robo-advisors, Good Advice clients will complete an online personal risk-tolerance assessment and provide information about their financial goals to determine an appropriate model portfolio. Portfolios will consist of exchange-traded funds, mutual funds and “other similar equity-related index funds, stocks or investment products.” Good Advice will also provide active tax-loss harvesting.

The regulatory description of the new robo is nearly identical to that of Liftoff, the robo-advisor Ritholtz first launched in 2015 using Upside Financial before relaunching in 2019 using Betterment for Advisors.

One difference is that Liftoff doesn't require a minimum account balance. Both services charge a maximum fee of 50 basis points, but Liftoff’s fee is split between the firm and Betterment, while Good Advice doesn't mention any other firm.

It's not clear when the product will be publicly available, or why Ritholtz Wealth Management is launching a second robo-advisor. Will the two run alongside each other as distinct products, or will Good Advice replace Liftoff? A spokesperson for the firm declined to comment.

The SEC filings also give no indication that Betterment is in any way involved with the new product. Betterment did not respond to a request for comment.

The filing was first reported by Citywire RIA.

In February, Ritholtz agreed to acquire the retail accounts managed by FutureAdvisor, BlackRock’s digital advice product. According to a Form ADV filed on March 30, FutureAdvisor managed nearly $649 million in assets, less than half of the $1.76 billion reported in April 2022.

Good Advice could let Ritholtz combine the existing Liftoff business with the newly acquired FutureAdvisor clients, said David Goldstone, manager of investment research at Condor Capital, which publishes a quarterly study on robo-advisors.

However, digital advice services launched by advisory firms like Ritholtz have struggled to attract clients, he said.

"Ritholtz will need a clear marketing and client acquisition strategy to grow a robo advice business and compete with established fintech players like Betterment and Wealthfront and major incumbents like Vanguard and Schwab," Goldstone said in an email. "The robo advice space has become crowded and highly competitive over the years."

Ritholtz Wealth Management manages $2.94 billion in assets, according to the firm’s most recently filed Form ADV.