Date Posted: 
Monday, May 11, 2015

At the swipe of a fingertip on a mobile device or the click of a mouse on a desktop computer, investors can access a broad range of automated investment tools.

These tools can range from personal financial planning tools (such as online calculators) to portfolio selection or asset optimization services (such as services that provide recommendations on how to allocate your 401(k) or brokerage account) to online investment management programs (such as robo-advisors that select and manage investment portfolios).

Many financial professionals have used automated investment tools for decades to help customers build and manage their investment portfolios, and a growing number of these tools are now available directly to investors from a variety of sources.

While automated investment tools may offer clear benefits—including low cost, ease of use, and broad access—it is important to understand their risks and limitations before using them. Investors should be wary of tools that promise better portfolio performance.

To learn more about the risks of these automated tools, investors should review the investor alert recently issued by the Securities and Exchange Commission and the Financial Industry Regulatory Authority, Inc. (FINRA).

View the alert at: http://www.investor.gov/news-alerts/investor-alerts/investor-alert-automated-investment-tools.