Wealthsimple is one of the world’s leading robo-advisor, with offices in Canada, the USA, and Europe. It is an online investment manager that helps people build smart portfolios and advise how to achieve financial goals.
Launched in 2014, it provides algorithmic investments and savings programs. It also creates a diverse portfolio with clear pricing and access to human financial advisors.
Summary: Although Wealthsimple has higher than average management fees, it helps people build smart portfolios and advises on how to achieve financial goals.
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|HQ||Toronto, Ontario, Canada|
|Fees||– Basic (up to $100,000): 0.5%|
– Black (Above $100,000): 0.4%
– Generation (Above $500,000):0.4%
|Accounts||Personal, Traditional IRA, Roth IRA, SEP IRA, Joint, Trust|
|Access||Manage your account from anywhere using the website or mobile app|
|Portfolio rebalancing||Free automatic rebalancing of your portfolio as the market changes – uses a rebalancing methodology that detects when the portfolio has an incorrect asset allocation|
|Tax loss harvesting||Available only in black account package|
|Automatic deposits||Allows you to schedule and make automatic contributions to your account to meet financial goals|
|Advisor||Human advisors are available to all clients at no additional fees|
|Fractional share||An exchange traded fund (ETF) is a bundle of fractional shares of individual stocks and bonds and offers a great way to diversify your portfolio|
|Socially responsible investing||Investors can choose from three risk-weighted SRI portfolio drawn from ETFs that are screened for fit to certain environmental, social, corporate governance, and performance|
|Smart-beta||Macroeconomic and style factors are used to determine the performance of stocks. Wealthsimple provides a platform with low fees and no commissions allowing you to create a personalized portfolio including investing in smart beta ETFs|
Wealthsimple provides powerful financial tools to help you grow and manage your money. It supports various accounts, including taxable individual and joint brokerage accounts, custodial accounts, traditional, retirement accounts.
It has five available portfolio options. These include conservative, Balanced, Growth, SRI, and Halal. Standard portfolios use 8 – 10 ETFs while SRI uses 6 ETFs and Halal has 50 individual stocks.
Wealthsimple offers investors different plans with different fees, features, and benefits. These include:
Wealthsimple’s fee structure (annual):
In addition to Wealthsimple’s fee, there are fees charged by the managers of the investment funds that you hold (annual):
An intelligent manager needs to screen for the best companies by going through massive amounts of data and designing top-notch analysis tools; that’s why there is a manager’s fee.
Wealthsimple also offers features like tax-loss harvesting and financial planning, making it worthwhile.
It takes a few minutes to create a Wealthsimple account. Follow these simple steps:
There are 4 easy ways to fund your account. These include transferring from a checking account, automatic recurring deposits, transferring an existing investment account to roll over an employer-sponsored plan. Withdrawal of funds is initiated from the app or website and will reach your account in 1-2 days. It might take up to 5 business days for the same to be reflected in your bank account.
Wealthsimple does not charge any transfer fees. They don’t charge anything for withdrawals, transfer outs, or leaving your account open with a zero balance.
Wealthsimple offers an average number of model portfolios to choose from with a low level of personalization. Asset allocation between stocks and ETFs will vary depending on your risk tolerance. Wealthsimple offers extra features like SRI and Halal portfolios to cater to the unique needs of specific clients.
Based on the information provided (your risk tolerance, how soon you need the money, etc.), Wealthsimple figures out the best investment strategy for you. They then use the money you have transferred into your account to buy a diversified mix of low-fee ETFs. These are optimized for your situation, and they manage your investment for you.
Wealthsimple provides five possible portfolios that include:
Wealthsimple manages your portfolio through a variety of market strategies to optimize your returns. These strategies include diversification across asset classes and the buy and hold strategy.
Together with these, Wealthsimple tracks your dividends and automatically reinvests them the day after they have been received. Also, the automatic rebalancing strategy monitors your portfolio automatically, according to market changes, deposits, or withdrawals, changes in your risk score, and well as changes in ETFs.
Wealthsimple also considers client feedback through the profile and risk scoring process. Progress towards your goals generates coaching from the system to either increase funding or stay in course. Wealthsimple allows you to invest and watch your savings grow without the added hassle of researching trading, etc.
Clients can speak with a financial advisor upon request. Or, you can also contact Wealthsimple by phone or email. There is no option for live chat for prospective or current account holders.
The Wealthsimple website has a comprehensive investing 101 glossary, a broad investment FAQ, and a monthly newsletter with dozens of ‘how-to’ articles. Since there is no internal search function for education content, it may be challenging to locate subjects of interest. In addition to this, some of the tutorials lack the quantitative tools needed to help you with financial planning.
It is also regulated by the Securities and Exchange Commission (SEC) with the protection of up to $500,000 on your capital.
Wealthsimple is right for investors of all ages looking to save money. It has no minimum balance, and investment portfolios have several ETFs. It offers tax-loss harvesting and provides a savings account with a competitive interest rate. Its SRI portfolio is a great investment platform for value-based investing.
It also offers UTMA and UGMA custodial accounts that may be appealing to investors with college-bound kids. The only downside to Wealthsimple is the higher than average management fees, but a higher quality of service comes with Wealthsimple.