Charles Schwab President and CEO Walt Bettinger was one of the keynote speakers on day one of the 30th Annual Morningstar Investment Conference in Chicago.
Jeff Ptak, Global Director of Manager Research at Morningstar, sat down with Bettinger at the conference to discuss many of the conference themes, including enabling technologies and automating decision-making.
Ptak asked Bettinger about its Schwab Intelligent Portfolio and related solutions and who’s the most eligible client for that type of solution.
“The genesis of intelligent portfolios was research that we did with existing self-directed clients of Schwab,” Bettinger said. “What we did is we sat down and showed them data about their financial results compared to other individuals who are getting professional investment advisory services. In general, they under performed. So we said, ‘What would it take for you to consider professional advice to get better outcomes?’ They said, ‘Well, I want a lot of diversification, I want automatic rebalancing, tax loss harvesting. I want the fees to be very low in terms of ETFs, and oh by the way, I’m not going to pay for it, with an explicit advisory fee.'”
Bettinger said the Schwab team took that information, went out and built intelligent portfolios.
“I think even today, it’s still targeted toward people who otherwise might be self-directed investors,” he said. Watch the full interview here:
For more information about the Morningstar Investment Conference, click here.