What Drives Robo-Advice?

The promise of robo-advisory firms is to provide low cost access to diversified portfolios built in accordance with the academic literature on normative portfolio choice. The authors investigate the latter claim. How much normative advice does robo-advice contain? For this purpose, they web-scrap portfolio recommendations for 151,200 investor types (input combinations from an online questionnaire) for one of the largest US robo-advisors. 

Results show that the type of investment goal and the length of time horizon are dominating inputs with significant influence on recommended equity allocations. Merton type hedging demands play no role at all.