Is Delphia safe?
Delphia is a mobile-only automated investment advisory platform with no management fees, powered by AI. It promotes itself as using a strategy similar to a modern quantitative hedge fund, saying it plans to use its own model to apply information from users’ bank and Twitter accounts to shape its portfolios. The key term here is “plans to.” Even though its marketing suggests otherwise, Delphia does not actually use data it collects from linked bank or social media accounts to guide investments.
Also, 99 percent of Delphia’s assets under management (AUM) come from two large hedge funds it oversees, so its aims might not always match those of everyday investors.
Even if Delphia eventually followed through on its data-driven investing claim, it would still have a lot to prove about whether its unusual method can generate above-average returns. Although it seems new, straightforward, and logical on the surface, Delphia is concerningly unclear, and investors can and should find better places to put their money.
Is Delphia legit?
First, Delphia is not a brokerage. Customers cannot trade individual stocks or ETFs. Bonds,
options, and other products are not offered.
That said, Delphia is a real entity. Its parent company is listed with the SEC as an investment adviser, and its brokerage partners, Alpaca and Apex Clearing, are members of SIPC, so client assets are protected up to $500,000 per account — the same coverage offered at Charles Schwab, Robinhood, or any U.S. brokerage.
However, the SEC requires a note saying that “registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the entity by the Securities Exchange Commission.” In other words, even though Delphia is an authorized business, it doesn’t automatically mean its investment strategies beat the market or that its portfolios are right for all (or any) customers. It also does not confirm that Delphia’s goals and ethics match its claims.
Especially with newer automated investing services like Delphia, investors should do thorough research before handing over their funds to portfolios they cannot manage themselves.
What makes Delphia unique?
As stated on its Crunchbase page, “Delphia is building the world's first investment adviser that allows people to invest their data alongside their money in order to improve their investment returns.”
Delphia’s selling point is gathering and (supposedly) using user data to guide its investment choices. The app asks users to allow access to their data, including credit card records and social media content.
A video on the company’s website explains why people might let Delphia use their data:
“When you connect your data to Delphia, you join our community of investors, which lets our algorithm analyze everyone’s attributes and behaviors together in order to make predictions about you and everyone like you. So when enough people invest with Delphia, we can make predictions about the entire stock market.”
The bottom line: this is misleading, as we’ll discuss soon.
How does it work?
Delphia has four investment portfolio strategies that users can choose. The platform has no management fees and requires only $10 to start. It claims to feature “a Wall Street-caliber algorithm designed to help you achieve superior investment returns.”
The Flagship portfolio is an AI-based, actively managed U.S. stock portfolio that “uses consumer data to improve the predictions of companies’ performance.”
The other three portfolios — the low-risk Conservative, the medium-risk Balanced, and the high-risk Growth — rely on the firm’s “Passive Plus” Portfolio approach. Each one uses a different stock/bond mix from the same core strategy, with some combination of fixed income and (not necessarily U.S.) stock holdings.
It is worth noting that users can subscribe to only one strategy at a time. While some automated advisors let customers spread their portfolios among multiple strategies (like 10% in one, 25% in another, 65% in a third), Delphia customers must put everything into just one of the four portfolios.
Delphia updates its portfolios by trading in big batches, typically about once a month. For users with small balances, this means many trades of fractional shares at once. Clients in the Flagship portfolio now hold stakes in 200 stocks, so people should expect frequent trade confirmations and/or shareholder voting messages each week.
Strategies Overview
| Portfolio | Equities | Fixed Income | Inception | Theoretical Performance Since Inception | S&P 500 Performance Since Portfolio Inception |
|---|
| Flagship | 100% | 0% | August 2020 | +36.22% | +26.45% |
| Growth | 80% | 20% | June 2020 | +19.01% | +29.51% |
| Balanced | 50% | 50% | June 2020 | +10.30% | +29.51% |
| Conservative | 30% | 70% | June 2020 | +3.81% | +29.51% |
So what’s the problem?
Put simply, Delphia doesn’t do what it implies it does.
Fueled by a recent $60 million Series A round (from a group that included the now-disgraced FTX Ventures), Delphia has cleverly branded itself as the company with a data-based investing plan without really delivering on that claim.
None of its strategies use customer data. Again: none of them actually use user data!!
It’s in the small print: “Currently, although Delphia Tech and the Investment Adviser are collecting some data through Member Contributions, the Investment Adviser does not use Member Contributions to power its advice.”
Delphia might argue that its platform never explicitly states it is now using user data to guide trades. And while it may not have outright lied, some of its claims are highly, and perhaps purposely, misleading.
For example, the Flagship portfolio says, “This portfolio uses consumer data to improve the predictions of companies’ performance.”
Imagine a user going to delphia.com/data and seeing “Profit from your own data, for once.” They like the idea that their “data will power our algorithm.” Next, they see, “As a data-contributing investor, you will be helping us build a company to redistribute wealth and take control over the greatest asset in your life – your data.” They buy into it and sign up. They link their credit card, bank, and Twitter accounts, believing what they’ve read. When they pick a portfolio, they choose Flagship because the description says, “This portfolio uses consumer data to improve the predictions of companies’ performance.”
Most people wouldn’t guess that “consumer data” actually refers to publicly available info — not the personal details they just handed over. They wouldn’t realize that Delphia’s Form ADV Part 2A says its AI tools “corroborate and calibrate publicly available data … [to] inform its investment advisory services to some of its Model Portfolios.”
See the issue?
Any other problems?
Yes! This is yet another business talking about democratizing investing, but using that pitch in a way that helps wealthy people gain even more wealth.
From Delphia’s most recent Form ADV, as of late October 2022, it manages over $192 million in regulatory assets. On closer look, of that total, less than $2 million belongs to 6,205 retail customers not classified as “high net worth individuals.” More than $190 million is split among five pooled vehicles, two of them being Cayman Islands-based hedge funds with gross assets of over $126 million and $63 million, respectively.
In other words, more than 99 percent of Delphia’s AUM is in two offshore hedge funds. This is the same firm that doesn’t actually apply your data to your investments as suggested, yet claims, “Your data is valuable. Hedge funds buy it to give themselves an edge, but you don’t see a cent. Delphia wants to change that.”
Other Considerations
Delphia recently launched a feature to reward people for sharing their data. Users get PHI, an ERC-20 token, for linking their bank, credit card, or Twitter profiles. The current reward is 0.2 PHI per week. It’s unclear what PHI will be used for, but Delphia says it’s “building a rewards program within Delphia that unlocks utility and opens up access to unique features within the ecosystem.” Time will tell.
It also seems Delphia has a plan that “redistributes” fees from its hedge fund investors to retail clients. Nobody knows exactly how it will work because the “Learn More” link is currently broken.
Delphia Review The Bottom Line
If you want to trade stocks and other securities directly, Delphia isn’t the right choice. If you want a hands-off, fee-free automated approach, Delphia’s portfolios might look appealing. But the fact that the platform misleads users about using their data for investing — plus the conflict of interest from Delphia’s hedge fund involvement — suggests that people seeking bigger returns can likely find better, more transparent automated investing options elsewhere.
Updated on 5/21/2025.
Leo Garkisch is an entrepreneur and freelancer based in Princeton, NJ. A quantitative value investor, he spends his time developing and deploying automated deep learning-driven algorithmic trading strategies that seek to capitalize on long-term disjunctions between equities’ market prices and their intrinsic values. In his free time, he enjoys playing and watching baseball and beating his friends in chess.
|