London, 12 September 2016 Scalable Capital, the European digital investment manager, is launching an ISA wrapper for its UK clients on 12 September. Under the new product, current and future clients will be able to access tax-free returns from investments with Scalable Capital for up to £15,240 for the 2016/17 tax year.
In parallel with the launch of the ISA wrapper, Scalable Capital is reducing the minimum investment threshold from £10,000 to £5,000, in order to allow current and prospective clients more flexibility when allocating funds to their ISAs. The change will allow Scalable Capital clients the option to build up incrementally their tax-free savings, while ensuring that the company’s sophisticated algorithm can continue to deliver strong investment performance.
Adam French, Managing Director and Co-Founder of Scalable Capital, said: “The average cash ISA now pays under 1%, and with the launch of our ISA wrapper we want to help UK savers get better returns on their money. Those who are apprehensive of the risks of investing into the capital markets will appreciate our unique ability to give them a clear picture of the risk that they are exposed to in their investments, and to ensure this risk doesn’t exceed the level they feel comfortable with.”
Scalable Capital, unlike traditional wealth managers or other robo advisors, makes use of new developments in research and technology to provide a data-driven investment service that doesn’t have to rely on simplifying assumptions about the behaviour of capital markets. Its risk management technology analyses market data using cloud computing and thus assesses the risk situation of various asset classes. This allows the company to proactively adjust portfolios in order to maintain their risk level, and to offer personalised rather than standardised portfolios to investors, where every trade is made only if it makes sense for them. Until now, this personalisation has only been available to investors with enough assets to afford a private wealth manager.
Scalable Capital’s proprietary technology dynamically allocates each investor’s portfolio based on a quantitative measure of their risk appetite. The technology uses forward-looking projections, based on recent market developments, to measure the level of risk in the ETF products the client is invested in, and then reallocates their portfolio according to their risk limit. In contrast to traditional wealth managers, Scalable Capital adopts a fluid approach to the weighting of asset classes in its portfolios. This allows investors to capitalise on markets where risk is rewarded, and limit exposure to excess risk in more volatile conditions. This state-of-the-art technology is an institutional class investment product, available, for the first time, to retail investors, at a fraction of the cost.
The UK team consists of Adam French (formerly Executive Director of Goldman Sachs’s Trading Division); Simon Miller (formerly Vice President at Barclays Capital) and Dr. Ella Rabener (formerly Founder and CEO of Westwing Russia and Associate Partner at McKinsey & Company).
Its unique risk management technology was developed in close collaboration with Professor Dr. Stefan Mittnik, Director of the Chair of Financial Econometrics and Director of the Center for Quantitative Risk Analysis at the Ludwig Maximilian University in Munich.