Tag: Performance

Posted on December 4, 2019

Betterment is Ranked #1 for First-Time Investors

Betterment is Ranked #3 for Digital Financial Planning


Overview: 

First launched in 2010, Betterment is one of the original robo advisors.  They have raised a total of $250 million in venture funding and have grown to be one of the leading digital advice providers. In their most recent annual disclosure, Betterment reports over $16B in assets under management (AUM) on their platform and services nearly 420,000 clients.  With no investment minimum and a 0.25% management fee, Betterment’s digital-only product is a strong choice for investors. They also offer various financial-planning packages that provide personal consultations with a financial planner on an as-needed basis, so that users only have to pay for personalized professional help as they see fit.  They offer a tiered service model, which allows investors to upgrade as their needs grow. Recently, Betterment has introduced a high-yield savings account to their platform and has announced plans to offer checking accounts in the near future.

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Posted on November 21, 2019

Should you use a robo advisor? Whether you are new to investing or not, the automated investing technology that robos provide can alleviate some of the stress and confusion related to investing. If you are not familiar with robo advisors, we suggest reading our breakdown first. 

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Posted on November 15, 2019

In the not so distant past, professional financial advice and investment management were only available to households with sufficient wealth. This began to change a decade ago, when startup financial firms digitally automated the investment management process, enabling them to offer professionally managed portfolios at low costs and low to no minimums. Fast forward 10 years and nearly every major financial institution in the United States either offers or owns a stake in a robo advisor. The individual who previously had no access to such investments is now overwhelmed with choices. Below, we provide insight into the most important factors one should consider when selecting a robo advisor. If you are unfamiliar with robo advisors or how they work, we suggest you first read our post, What is a Robo Advisor? 

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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 7, 2019

Schwab and Vanguard are the two dominant platforms in the digital advice industry.  Leveraging their clout as established investment managers, Schwab and Vanguard have amassed $43 billion and $140 billion, respectively, in assets under management on their digital platforms.  Below is a comprehensive comparison of the two services, including facts, features, and historical performance based on accounts we have open at both providers.

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