What are the risks associated with Robo-Advisor?
If you invest with Robo-Advisor, in the event that Revolut Securities Europe UAB becomes bankrupt, up to €22,000 of your funds and securities will be protected by the Lithuanian Liabilities to Investors Insurance Scheme. This doesn't protect against market risks associated with investing. As with any financial instrument, using Robo-Advisor involves the risk of losing all or some of the money you invested.
Typically, the more risk in a portfolio, the greater potential for returns. However, the portfolio's value is also likely to fluctuate more significantly.
Revolut will use your answers in the suitability questionnaire to determine a portfolio that best matches your risk tolerance. The degree of risk will vary based on the results of the suitability questionaire.
Although returns can't be guaranteed, Robo-Advisor invests in multiple exchange traded funds (ETFs), and this diversifies the investment. In some, but not all cases, this might limit your losses.
By creating a diversified portfolio of assets, Robo-Advisor spreads risk across different asset classes, geographies, and sectors, which may help mitigate the impact of any individual market event or asset performance.
While diversification can help to reduce the overall risk of a portfolio, it doesn't protect against loss. For more information on the risks you should consider before using Robo-Advisor, please see our Risk Description.