FutureAdvisor isn’t just another financial investment manager, but instead a technology driven investment advisory firm that helps you manage existing IRA, Roth, and other accounts by using a combination of real people and robo-advisors to help automate portfolio management.
FutureAdvisor will help you gain a holistic view of your accounts by linking your different investment accounts and allowing you to view them all in one place. On top of that, the account stays in your name and FA simply manages it as a fiduciary.
By applying things like modern portfolio theory, the Black-Litterman model, and other tried and true algorithms, the robo-advisors are able to take away a bunch of the heavy lifting that was traditionally left to a financial advisor. FutureAdvisor will also use a proprietary algorithm to help monitor your portfolio daily for tax-saving opportunities. All of these things combined help give you comprehensive understanding of what is going on, while allowing FA to give advice based on the whole, instead of just individual parts.
With all of this tech, you need a strong team of programmers and engineers capable of bringing it all together. Ephrat Bitton is one such engineer.
Bitton is the Principal Scientist at FutureAdvisor and part of the team that makes everything possible on the robo-advising end of the company. I had a chance to talk with her about the company, find out what a Principal Scientist actually does, and discuss a bit about women in the tech field, and more specifically the engineering field.
Check it out below!
In a few sentences, can you describe your work at the company?
I am primarily responsible for designing, building, and maintaining the optimization model used to automate portfolio management for our clients. These days, much of my time is focused on working with partners to build custom versions of the model according to their unique outlooks and methodologies.
Until recently I was also the manager of the Portfolio Intelligence team, driving innovation on all systems related to portfolio management, such as trading, data sourcing, and analytics. In the next month or so, I will be transitioning into a more research-focused role that will give me the time and resources to implement some of the bigger ideas we have been wanting to build.
Do you have any particular parts of FutureAdvisor that you built or helped build that you’re particularly proud of?
I’m definitely most proud of the optimization model/algorithm that I built for portfolio management. I have a math background, not finance, so getting to this stage required a lot of on-the-spot learning, which was fun. The model is currently used to manage nearly a billion dollars of assets and has been operating reliably for years with very few issues. I even use it to manage my own retirement portfolio, which I think is pretty neat.
It’s great to see both FutureAdvisor and BlackRock supporting female engineers; what are some thoughts you have on how other companies could do the same?
Let’s face it: Engineering teams don’t usually become diverse organically. I think the only real way to support marginalized groups in engineering is to make it an actual priority. I’ve heard so many of my male engineer friends complain that “there just aren’t any females in the applicant pool.” The problem isn’t the applicant pool but where you’re sourcing from and how.
We decided early on to prioritize diversity. One way we did this was require there to be at least one female on every interview loop. This seems small but it keeps women involved in decision making. More importantly, it ensures new hires are comfortable interacting with women. We had open discussions on the issue, which helped cultivate a healthy and diverse culture.
Now that the company has grown substantially, we’re taking our diversity initiatives further. We’ve formed a variety of groups that are tasked with driving initiatives on improving our culture, ensuring marginalized groups can achieve and succeed in leadership positions, recruiting diverse candidates, and employee training. Each of these task forces have come up with specific metrics that they are tracking and they are meeting on a regular basis to report progress and determine the path forward.
Just like any organization, FutureAdvisor certainly has room for improvement. What’s special about this place, though, is that people genuinely care and want to see progress along these lines.
To make diversity a priority, make the effort to learn why you’re unable to source female applicants. Go to Grace Hopper and recruit there. Sponsor events in support of these groups. Make sure all employees, and especially executives, receive unconscious bias training. Make sure your job postings are gender neutral.
What is your history in tech?
I received my PhD in Industrial Engineering and Operations Research (IEOR) from UC Berkeley in 2011. IEOR provides you with the tools to model and solve complex, real-world decision problems. I was particularly drawn to the idea that you can use mathematical models to better understand the world, make smarter decisions, and that the same underlying techniques can be used in multiple areas: finance, air traffic control, robotics, even radiation therapy.
However, I realized that to be truly self-sufficient in making these models reality, I would need to be able to program. I took as many computer science courses as I could, and managed to pick up an additional Master’s degree in Computer Science by the time I graduated. I joined FutureAdvisor in 2012 as the fifth employee, which gave me the opportunity to help the company grow and to see all of the ups and downs a startup experiences on its road to success.
Where do you feel that fintech solutions like FutureAdvisor fit into the average person’s life?
I came to work at FutureAdvisor not only because I found the mathematical modeling challenges extremely interesting, but because I truly believed in the mission of the company. It’s become clear to me how lacking we are, as a society, in educating our youth on retirement planning and financial responsibility. Even worse, helpful resources have been traditionally out of reach for the majority of folks who just couldn’t afford the exorbitant fees.
I saw FutureAdvisor, and really fintech as a whole, as a way to make financial literacy more accessible and affordable. I hope that people will be able to leverage these technologies to help secure their financial futures. However, I think we’re only at the beginning of raising awareness about financial literacy and finding solutions that meet consumers’ needs.
I’d like to thank Ephrat for taking the time to answer some of my questions!
Photo creds: Unsplash and FutureAdvisor
This post is part of our contributor series. It is written and published independently of TNW.
This post is part of our contributor series. The views expressed are the author's own and not necessarily shared by TNW.