Tag: E*Trade

Posted on November 13, 2019

Through the end of the third quarter of 2019, the active robo portfolios we track have shown some early signs of outperformance when compared to the passive offerings from the same providers. Over the first three quarters of 2019, our active portfolios at E*Trade, Morgan Stanley, and TIAA returned 13.42%, on average. The standard offerings from the same providers returned 12.55% over the same period. For the two providers at which our active portfolios have a year of performance—Morgan Stanley and TIAA—the active options have slightly outperformed standard offerings. One factor driving this outperformance is that many of our active portfolios have a tilt towards growth stocks that have outperformed value stocks in the first three quarters of 2019.

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Posted on November 8, 2019

Consumer demand has prompted digital advisors to offer socially responsible investing (SRI) portfolio options over the past few years.  We have opened and now have eight pairs of portfolios (regular and SRI) included in our report, including six pairs with a year or more of performance reported.  The SRI robo portfolios included in our analysis are offered by Betterment, E*Trade, Ellevest, Merrill Edge, Morgan Stanley, TD Ameritrade, TIAA, and Wealthsimple.  

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Posted on November 6, 2019

Prudential, Axos Invest, and Acorns Lead YTD

Amongst our taxable robos, Prudential, Axos Invest (formerly WiseBanyan), and Acorns are the top performers YTD for performance above/below the Normalized Benchmark. All three portfolios have above-average allocations to domestic stocks, which have outperformed international equities consistently over the past three years. Axos Invest has emerged as a long-term performance leader, proving that a simple portfolio can achieve strong long-term performance. Axos’s domestic equity allocation relies almost entirely on the Vanguard Total Stock Market ETF, and their fixed income consists of high-yield and investment-grade corporate bonds. 

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Posted on September 8, 2019

As existing firms have grown and new players have entered an increasingly crowded field, companies have looked for new ways to differentiate themselves. For some companies that means offering “active” portfolios. Although Backend Benchmarking has only had our active accounts opened for a short time, active portfolios have showed some early signs of outperformance.  Active portfolios outperformed their passive counterparts in the first six months of 2019 by 1.17% on average. One significant factor that may be driving this short period of outperformance is many of our active portfolios have a tilt towards growth which has outperformed in the first 6 months of 2019.

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Posted on September 6, 2019

In recent years, socially responsible investing (SRI) – also commonly categorized as environmental, social, and governance investing (ESG) – has gained popularity with retail investors and investment managers alike.  Between 2016 and 2018, assets invested in ESG-themed mutual funds grew 34%, while assets in ESG-themed ETF funds more than doubled. Driven by consumer demand, a natural expansion has been undertaken by digital advisors to offer separate SRI portfolio options.  Within the past few years we have opened and funded SRI accounts at each of the providers that offer sustainable investing options. With a year of performance to review, we have assessed the risk and return statistics of SRI portfolios offered compared to their standard offerings.  While today’s focus is on performance, we will publish a full report on the composition of SRI portfolios, including costs and sustainability scores, later this month.

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