Jeffrey Gundlach not impressed with robo advisers

He says 'one-size fits all' portfolios are a dangerous bet, especially in a market decline
JUN 23, 2017
By  Bloomberg

In the financial industry's battle of humans versus machines, billionaire bond fund manager Jeffrey Gundlach is betting people will prevail. "I don't believe in machines taking over finance at all," Mr. Gundlach, CEO of DoubleLine Capital, said Thursday night in a cocktail-hour interview before his induction into the Fixed Income Analysts Society Inc.'s Hall of Fame. Mr. Gundlach, 57, is a top-ranked money manager whose $54 billion DoubleLine Total Return Bond Fund has outperformed 90 percent of its Bloomberg peers over the past five years. He co-founded the Los Angeles-based firm, which managed more than $100 billion as of March 31, after being ousted by TCW Group in 2009. Mr. Gundlach singled out so-called robo-advisers, which provide online portfolio management using little human intervention, as a dangerous bet. "It's a one-size-fits-all financial solution," he said. "Everybody gets the same portfolio, which means everybody owns the same stock, which means when they all decide to get out you cause a crash." What's Mr. Gundlach's advice for beating machines? "Work hard," he said.

Latest News

RIA moves: True North adds $353M California RIA as SageView grows North Carolina presence
RIA moves: True North adds $353M California RIA as SageView grows North Carolina presence

Plus, a $400 million Commonwealth team departs to launch an independent family-run RIA in the East Bay area.

Blue Owl Capital, Voya strike private market partnership for retirement plans
Blue Owl Capital, Voya strike private market partnership for retirement plans

The collaboration will focus initially on strategies within collective investment trusts in DC plans, with plans to expand to other retirement-focused private investment solutions.

Top Commonwealth advisor to recruiters: Stop with the cold calls already!
Top Commonwealth advisor to recruiters: Stop with the cold calls already!

“I respectfully request that all recruiters for other BDs discontinue their efforts to contact me," writes Thomas Bartholomew.

Why AI notetakers alone can't fix 'broken' advisor meetings
Why AI notetakers alone can't fix 'broken' advisor meetings

Wealth tech veteran Aaron Klein speaks out against the "misery" of client meetings, why advisors' communication skills don't always help, and AI's potential to make bad meetings "100 times better."

Morgan Stanley, Goldman, Wells Fargo to settle Archegos trades lawsuit
Morgan Stanley, Goldman, Wells Fargo to settle Archegos trades lawsuit

The proposed $120 million settlement would close the book on a legal challenge alleging the Wall Street banks failed to disclose crucial conflicts of interest to investors.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.