Commercial Bank Dubai (CBD) has a vision to be ‘default digital’ as it wants to be ahead of the advancements in mobile apps and data analytics that are changing the banking sector. Its CBD Investr robo-advisory solution is one such example, which helped it win the Most Effective Investment Service Offering at the MENA Banking Excellence Awards 2022. The CBD Investr app automates client advising and investment recommendations. It was developed in partnership with InvestSuite, a wealthtech company in Belgium, and is powered by smart algorithms that actively manage investment portfolios to deliver optimal risk adjusted performance, using real-world market data from the past 10 years.
The algorithms have been extensively back tested with data from the past decade, outperforming the market benchmarks over that time span. For instance, the High Growth portfolio, which allocates 100% of the investment to equities, has theoretically returned over 12% per annum on average over the past 10 years. The returns evidence suggests a strong performance should be achievable allowing customers to get automated maximum returns. There are four risk profiles to choose from the last decade, with their respective performances demonstrated below. Depending on the risk appetite of investors you can be:
Conservative (4.9%),
Balanced (8.2%),
seek Growth (11.3%),
or High Growth (12.2%).
and personalized portfolios of stocks, bonds and other asset classes using low-cost exchange traded funds (ETFs). These portfolios are tailored based on customer’s specific goals, risk appetite and investment time horizon and are actively monitored and optimized based on changing market conditions to deliver the best possible performance over the long term. The back tested data from the last decade shows when markets fall, as they inevitably do, the losses will be less on the app, and when they rise returns will be maximized.
Portfolios are actively monitored on a daily basis and the algorithms reallocate underlying assets when needed to optimize performance, as what worked yesterday won’t necessarily work again. The robo advisor investment platform has:
An entry level investment of $500,
An annual management fee of 1%.
Transparency in pricing with no hidden fees, or lock-in periods, plus no contractual agreements for monthly or regular investments. Customers can withdraw funds at their convenience with no withdrawal fee.
Further enhancements include a Self Investr option, which gives access to an easy-to-use digital trading experience. CBD Self Investr users can buy and sell over 8000 shares and ETFs in real-time themselves with free streaming data feeds showing live market prices. Free local transfers in Emirati Dirhams (AED) are also on offer. Customers can start trading from as low as $50 and there are no withdrawal or penalty fees.