Pros, cons and who should create an account
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- Interactive Advisors is an automated investment platform affiliated with Interactive Brokers.
- You can start with as little as $ 100, but the fees can range from 0.08% to 1.5%.
- It offers managed portfolios, socially responsible options, smart beta portfolios, and more.
- Click here to create an account with Interactive Advisors.
Is Interactive Advisors Right For You?
Interactive Advisors is an automated investment platform serving U.S.-based investors affiliated with
Interactive Brokers platform.
It offers a range of portfolio options and allows you to automatically reflect the same trades its professional portfolio managers make in their accounts.
With as little as $ 100, you can automate several types of accounts, including IRA accounts and individual, joint, and trust accounts.
Not sure if Interactive Advisors is right for you? Read on to see how it compares to other automated investment brokers.
How do Interactive Advisors compare?
Interactive Advisors, Betterment, and M1 Finance all offer investment options for self-directed investors who prefer automated portfolio management. You will mainly notice differences in the fee structures, investments, and benefits of the account.
Interactive Advisors and M1 Finance are more ideal for those who like to have both automated portfolio options and the flexibility to choose their investments or portfolios.
Betterment, however, may be a better choice for those who are strictly looking for low-cost automated portfolio management, with access to individual and joint accounts, trust accounts, IRAs, and human advisors.
Ways to invest with interactive advisors
Automated portfolio management
Some automated investment accounts like Betterment and Ally Invest Managed Portfolios only create a personalized portfolio for you after you answer a series of questions about your investment preferences.
Interactive Advisors, meanwhile, offers you two possibilities: Complete a questionnaire to receive a personalized portfolio or choose one of the 60 portfolios it offers. The company’s interface makes it easy to filter the different portfolios.
The platform also offers several investment options. These include:
- Asset allocation portfolios: Interactive Advisors’ asset allocation portfolios invest your funds in a diverse mix of ETFs. This option includes a 0.12% asset-based fee.
- Actively managed portfolios: Portfolio management is primarily the responsibility of the CIO and the investment team of Interactive Advisors, but the company also relies on Registered Investment Advisors (RIAs) and data from top investment management firms . These portfolios use a wide range of ETFs and may have minimums of up to $ 50,000.
- Smart Beta Wallets: Interactive Advisors says these portfolios aim to achieve more attractive returns through an alternative risk-return profile. These portfolios also include fractional shares and automatic rebalancing.
- Socially responsible portfolios: You can invest in companies that strive to have a positive impact on the world and that embody other ESG factors.
When you invest in an actively managed portfolio, Interactive Advisors says that it purchases the securities in that portfolio and places them in your brokerage account. Plus, every time the portfolio manager executes a trade, Interactive Advisors performs the same trade for you.
Interactive Advisors supports individual accounts, joint accounts, and IRAs. You can also upgrade your account to a self-directed brokerage account at any time.
Interactive Advisors primarily use ETFs and other funds when building portfolios. Its asset allocation portfolios use the following elements:
- Equity: This gives investors exposure to US equities and equities from developed and emerging markets (funds used include VTI, DVY, VO, VB, VEA and VWO).
- Link: Interactive Advisors uses several ETFs for exposure to bonds. The funds used in this component include BND, LQD, HYG, TFI, TIPS and BNDX.
- Inflation hedge: The platform’s asset allocation portfolios also invest your money in real estate and commodities to protect you against inflation. The funds it uses include VDE, VNQ and Inflation Protected Bonds (TIP).
In addition, Interactive Advisors’ other three portfolio options – Smart Beta, socially responsible and actively managed – also use a range of ETFs. Its asset allocation portfolios have a minimum of $ 100 and an advisory fee of 0.12%. You can learn more here.
Interactive Advisors trustworthy?
Personal Finance Insider measures reliability by examining each company’s Better Business Bureau profile. Interactive Advisors currently does not have a BBB profile.
However, Interactive Advisors and Interactive Brokers LLC are part of the Interactive Brokers Group. Since all clients of Interactive Advisors must have accounts with Interactive Brokers, it should be noted that Interactive Brokers currently has an A + rating with the Better Business Bureau.
Nonetheless, always make sure you do your due diligence, as the office says its ratings are no guarantee of a company’s reliability or performance.