Ally Invest Managed Portfolios Review: Is It Worth It?

Marcus Invest offers the core feature of a robo-advisor – portfolio management – and then adds some twists, such as several portfolio types, all for a cost-competitive fee. It’s a great add-on for current Marcus customers, though some features of higher-end robo-advisors such as tax-loss harvesting and an expansive toolset are missing. Wells Fargo Intuitive Investor is a solid robo offering that gives customers easy access to human financial advisors at no additional cost along with tax-loss harvesting that can help you save on taxes. However, the management fee is above average unless you’re an existing Wells Fargo banking customer.

There’s no https://trading-market.org/ deposit required to open a self-directed brokerage cash account. Self-directed brokerage margin accounts require a $2,000 minimum deposit. To participate in Wealth Management, we require a $100,000 minimum in assets under care.

Anyone can take the Robo Portfolios questionnaire and receive a portfolio suggestion before taking any action for opening an account. Opening an account for current Ally customers is quick, with a simple transfer from your existing account to open the new account. The account setup process was quick for non-customers, too, although these customers need to wait for the transfer to be deposited before the portfolio is funded. Investment advisors are not available for Robo Portfolios customers, so you don’t need to speak with anyone to get going and open an account.

When it comes to a Cash-Enhanced Managed Portfolios account, you will need a minimum of $100 to begin investing. This is not an exorbitant minimum, but it may be a deal-breaker for some who hoped to ease into investing with a smaller sum. Ally Invest is the former TradeKing platform, which Ally acquired in 2016. Since then, the service has grown and today is one of the heavy-hitters in the online investment space.

How Does The Ally Invest Robo Portfolio Work?

Like other robo-advisors, the platform utilizes your personal goals, timeline, and risk tolerance to recommend a balanced portfolio. As market conditions change, automatic rebalancing occurs so that your portfolio is consistently aligned with your goals. You’ll get updates when this happens so you always know what’s going on with your account.

This portfolio holds 30% of your funds in a cash account that earns 0.55% APY at the time of writing. The Ally Invest Robo Portfolio is managed by Ally Invest, the investing branch of Ally Financial. Through its robo advisor technology, Ally Invest gives investors the chance to have professionally designed and robo portfolios, complete with personalized advice and investment selections. Ally offers cash management services that include bill pay, check writing, and debit cards, but these services are not integrated within the Robo Portfolios accounts. Cash services are available through a separate Ally account, but there is a good chance Robo Portfolios clients are existing customers that already have an Ally Bank account with cash services. Moreover, if you do cash out some of a cash-enhanced portfolio, the remainder of the portfolio will still have 30% in cash.

• Perplexingly, though, even a long-term core portfolio with a high risk tolerance will still have a small allocation to bonds.
• Prior to buying or selling options, investors must read the Characteristics and Risks of Standardized Options brochure (17.8 MB PDF), also known as the options disclosure document.
• If you’re seeking a free robo-advisor with $100 minimum to a get started, then yes, managed portfolios is worth a look.
• Everyone has differing levels of risk they’re willing and able to take on, which can influence the balance of holdings within your portfolio.

Traditional banks aren’t always the best option, as their fees are often higher, and you can’t always maximize the benefits. Thankfully, there are alternatives, like Spruce Money from H&R Block. But how does Spruce compare to other online banks, like Chime and Current? It’s not ideal for advanced investors, day traders, technical traders, or someone who needs a lot of market data to make decisions. If that describes you, there are other brokerages that will give you that level of detail into the market. I first fell in love with them because they offered inexpensive trades but now that so many brokerages are offering free trades, I’ve stayed for the ease and simplicity of the platform.

Online brokerages offer secure storage for investments and access to investment markets. The best online brokerages — and the best online brokerages for beginners — are user-friendly, offer research availability, and educational tools and resources. With automated tax-loss harvesting, a robo-advisor will sell money-losing investments and “harvest” those losses, which can be used to offset gains elsewhere. It’s a useful feature that minimizes your tax bill today and can even save you on future taxes, too. So current customers of Ally may find its robo portfolios option a bit more appealing. The goal of tax loss harvesting is to minimize the taxes you pay on gains in your taxable investment accounts.

What is the minimum deposit for Ally Invest?

One of the major benefits of investing with Ally is that you get 24/7 access to specialists to help with your questions. While this doesn’t cover financial advice, you can call the helpline to troubleshoot any account issues that crop up, day or night. Pick your preferred contact method through either phone, email, or online chat. Ally Invest Robo Portfolios is an Ally Financial-affiliated automated account offering investing without fees for US residents. Ally Invest Advisors, Inc. manages the account and is in turn a subsidiary of Ally Invest Group, Inc. Many or all of the offers on this site are from companies from which Insider receives compensation .

Ally Invest’s Robo Portfolios is an excellent choice for existing Ally customers because they can consolidate all of their finances across Ally’s banking, lending, and investing platforms. We publish unbiased product reviews; our opinions are our own and are not influenced by payment we receive from our advertising partners. Learn more about how we review products and read our advertiser disclosure for how we make money. Ryan Eichler holds a B.S.B.A with a concentration in Finance from Boston University. He has held positions in, and has deep experience with, expense auditing, personal finance, real estate, as well as fact checking & editing. SelectingContinuewill take you to a website that Ally Bank does not own or control.

Does cash in Ally Invest earn interest?

Highly diversified across domestic, international and fixed-income assets. We review your portfolio daily and adjust it as needed, for no extra fee, to help keep it aligned with your goals. Lance Cothern is the founder ofMoney Manifesto, a personal finance blog that helps people to master their money so they can live their ideal life.

Much of the educational content is found on the Ally community page, where there is content across the Ally product lines, including auto loans, banking, and investing. The Ally Invest product line covers content like bonds, stocks, and options. This content can also be customized on the community page by the user so they see what they are interested in when pages load. While Ally’s desktop app and website are not dedicated to robo investing, Ally Invest Robo Portfolios are easily accessed through these platforms.

Each entity is regulated and registered with financial organizations. However, you’ll have to pay certain fees for account transfers or closures. Ally Invest charges $25 for IRA account closures, $75 for full account outgoing transfers, and $50 for partial account outgoing transfers.

Ally Invest and E*TRADE pros

Matt is a Certified Financial Planner® and investment advisor based in Columbia, South Carolina. He writes personal finance and investment advice for The Ascent and its parent company The Motley Fool, with more than 4,500 published articles and a 2017 SABEW Best in Business award. Matt writes a weekly investment column (“Ask a Fool”) that is syndicated in USA Today, and his work has been regularly featured on CNBC, Fox Business, MSN Money, and many other major outlets. He’s a graduate of the University of South Carolina and Nova Southeastern University, and holds a graduate certificate in financial planning from Florida State University. Ally Invest doesn’t offer live financial advice to its robo-advisory clients. All of the financial guidance on the platform is via automated portfolio recommendations.

We took a further look into both robo portfolios, and this is what we found. With the individual investor in mind, we’ve designeda comprehensive ranking methodologyto find the best overall robo-advisors and the best robo-advisors across nine key categories. Each advisor is then scored across multiple variables to rate performance in every applicable category.

In addition to not charging a base commission for options trades, Ally Invest’s per-contract fee comes in lower than many other brokers at $0.50 per contract. Until 2019, Ally Robo Portfolios showed performance data for each of the five risk tolerance levels. Other sources calculate the returns and over the past three years, Ally’s 60% stock and 40% bond portfolio garnered in approximately a 9+% return, in line with many competitors. You’re always shown the zero-fee with 30% cash option and given the opportunity to view the fully invested portfolio which charges a 0.30% AUM fee.

More mutual funds to choose from when self-directed trading (at a cost)

Ally doesn’t publish the underlying expense ratios of its funds, but annualized fees between 0.05% and 0.20% are typical of the funds most robo-advisors use. You’ll answer a series of questions about your investment objectives, time horizon, assets, risk tolerance and more. From there, you’ll pick the type of portfolio that best fits your objectives, and Ally will suggest an ideal asset allocation strategy for you. Members should be aware that investment markets have inherent risks, and past performance does not assure future results.

• After that, you choose how much risk you’re comfortable with and your desired portfolio type, and Ally offers a personalized recommendation.
• With competitive pricing, low minimums, and features such as automatic rebalancing, Ally Invest Robo Portfolios is a great choice for anyone without a lot of cash to spend.
• With Ally Managed Portfolios, rebalancing happens automatically so you don’t have to worry about your investments getting thrown off-kilter.
• Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
• Since portfolio management is handled by software rather than a human financial advisor, robo-advisors charge lower fees, which can translate to higher long-term returns for investors.
• We also take into account your personal goals and risk tolerance to create a portfolio tailored just for you.

There’s never a guarantee you’ll make a return or even break even on your investment. However, real estate can be a smart way to diversify your portfolio, as it typically does not have a strong correlation with the equities markets. This is what you’ll pay annually to have an account at a robo-advisor. But if you are comfortable managing your holistic wealth picture on your own and don’t necessarily need additional touchpoints with a human advisor, you may prefer the Ally Invest model. In fact, you could potentially save quite a bit of money if you stick with Ally’s single-tier pricing model compared to multi-tier plans that are offered by competitors.

Depending on which kind of account you choose to open, Ally Invest works slightly differently. For its managed portfolios accounts, it starts by analyzing your investing and savings goals. It takes into account your age, what you’re saving for and your investing strategy, including how much risk you’re willing to take on. From there, it can begin making the most appropriate portfolio for you. Ally initially recommends to investors its Cash-Enhanced Managed Portfolios.

ally invest reviewly, if you want to trade mutual funds, the best way to do that is to open an account with the company that offers the funds. For example, if you want a Vanguard fund, open a Vanguard account because you can buy and sell shares for free. And if you want a Vanguard ETF, you can buy and sell those for free on Ally Invest or Vanguard.

When Ally Invest customizes the portfolio’s asset allocation, it always utilizes multiple funds on stocks and bonds next to the compulsory cash position. The core portfolio is perfect for investors that are looking for a diversified hands-off investing portfolio. Diversification occurs across national and international stocks and bonds and the investor’s risk tolerance can range from conservative to aggressive.

And though you’ll have to pay $0.50 for each options contract, this is about $0.15 less than what other brokerages – such as Fidelity and Merrill Edge — typically charge for options. For instance, Ally Invest’s automated account has no advisory fees, and it only requires a minimum balance of $100. You’ll pay 0.45% to 0.85% if you want to take advantage of robo-advice at Merrill Edge.