Edelman Financial Engines faces a credit negative outlook following Vanguard Group's announcement of its new robo-adviser service, a report from Moody's Investor Services says.
Vanguard Digital Advisor, an automated, digital-only financial planning service for 401(k) accounts, will charge a net advisory fee of 15 basis points, according to Vanguard's Sept. 16 initial disclosure filing with the SEC, and the Moody's report said the fee is a credit negative for Edelman Financial Engines Center LLC, which targets between 20 and 120 basis points to manage workplace accounts.
Edelman Financial Engines has a current Moody's credit rating of B2 stable. Financial Engines was purchased by private equity firm Hellman & Friedman in 2016 and merged with private wealth management and investment advisory firm Edelman Financial Services.
Edelman Financial Engines officials could not be immediately reached to provide comment.