lzrs

Well, actually a lot of these strategies are really hard to implement on your own. For example, in direct indexing you are buying hundreds of stocks in an attempt to replicate an indexing. You are also constantly rebalancing and tax-loss harvesting.

You could definitely just buy an index fund, but it's not exactly comparable.

Yes, completely agree. That happens when all of the other estate planning costs begin to vastly outweigh the cost of investment advising. I'm no expert, but I am under the impression that although these automated strategies are a smaller part of the whole picture for high net-worth individuals, the strategies are still the same.

I'm interested to see if UBS can add value in those ways you mentioned, while still using sophisticated automated strategies for cost savings purposes.

Also note that Vanguard, JPM, Schwab, Fidelity etc. are getting in the robo-advising/direct indexing game.

I've been researching robo-advisors quite a bit recently. They are really interesting and innovative.

I'll preface by saying that I have been talking to a lot of financial planners (at top-tier institutions). They basically set you up with a good set of ETFs, hedge funds, etc. and rebalance occasionally. Sometimes they do tax-loss harvesting. They also provide a few other nice little services. But at the end of the day, their fees are over 1% unless you have an ultra high net-worth.

In comparison, Wealthfront can automate huge strategies for a fraction of the cost (0.25%). For example:

- Direct Indexing (invest in an index by buying the stocks directly instead of a fund)

- Automatic investing, rebalancing, and tax-loss harvesting (including TLHing individual stocks within an index when paired with direct indexing)

- Coordinating trades between retirement and taxable accounts for optimal tax savings

- Smart beta (a custom weighted indexing algorithm)

Yes, a financial planner can do all of this (although most don't). But when they do, they just use automated software to do it. It would be impossible to implement these strategies manually. So why even go with a financial planner when Wealthfront does the same thing, but better/cheaper?

Absolutely correct. I propose a solution at the end of the essay.

Under my proposed system, apps are installed into a group. So you bring all of your social graph and data.

Alice could invite Bob and Carole to a group. From the group, instead of a chat UI, there would be an app launcher. They could launch into a chat app, a game, or any sort of social/multiplayer experience.

Essentially, there is never a bootstrapping problem for any app because the platform itself provides the social graph. There is also no interoperability problem because versions are consistent across the group (although you could run two forks in parallel, but they would never talk to each other).

Not all apps can be built on this platform, but a large number of useful apps can.

Thanks for the pushback here.

You cite a great example of central planning gone wrong. They had a creative strategy to run the company and it clearly didn't work.

What if someone could "fork" Sears and have the exact same business, except take things in a different direction (in parallel). Of course, that is impossible since Sears is not a digital product operated by a DAO. However, that is precisely why I claim "DAOs change everything". I lay out what I believe are the necessary conditions for this to work toward the end of the essay.