1. Managed Portfolios

Mr A

Overview

InvestEngine is a UK-based online investment platform that offers both a managed robo-advisor service and a commission-free DIY platform. Launched in 2020, InvestEngine aims to provide cost-effective, diversified investment portfolios for individuals with varying risk appetites and financial goals. But is the platform really worth it? In this review, we will explore InvestEngine’s key features, fees, investment strategies, and how it compares with other robo-advisor platforms.

InvestEngine's Key Features

1. Managed Portfolios

InvestEngine offers a range of managed portfolios to suit varying risk profiles, with options for conservative, balanced and growth-focused investors. Portfolios consist of exchange-traded funds (ETFs), which are low-cost, liquid investment vehicles providing diversified exposure to a specific asset class, industry, or geographic region. Investors can choose between income-generating and accumulation portfolios based on their preference for dividend income versus capital gains.

2. DIY Investment Platform

For investors who prefer a more hands-on approach, InvestEngine also offers a commission-free DIY platform. Users can select and create their portfolios composed of ETFs and funds available on the platform. This option allows investors with specific investment objectives or areas of interest to tailor their investments accordingly.

3. Low Fees

InvestEngine is designed to be a cost-effective platform. There are no charges for account setup, administration, dealing, or inactivity. For managed portfolios, InvestEngine charges an annual fee of 0.25%, significantly lower than many other robo-advisory platforms. Additionally, the average ETF annual management fee for InvestEngine’s managed portfolios is around 0.12%. With the DIY service, users do not pay service fees, only the ETFs annual management fees.

4. Automatic Rebalancing

InvestEngine reviews and rebalances managed portfolios every month, aiming to keep each investor's risk levels and asset allocation in alignment with their original preferences. The platform also monitors and rebalances individual investments for DIY investors, ensuring they remain on track to achieve their financial goals.

5. UK-based and Regulated

InvestEngine is regulated by the Financial Conduct Authority (FCA), providing users with the assurance that their investments are protected by a reputable regulator. Additionally, InvestEngine is a member of the Financial Services Compensation Scheme (FSCS), which provides up to £85,000 of protection per eligible claimant.

InvestEngine's Fees and Charges

Managed Portfolios:

Annual management fee: 0.25%
ETF average annual fee: 0.12%

DIY Service:

Service fee: £0
ETF/fund annual fees apply (dependent on the ETF/fund selected)

With low and transparent fees, InvestEngine provides a cost-effective option for individuals looking to invest in ETFs. However, it's essential to consider that certain ETFs may have transaction costs that can impact overall investment returns.

InvestEngine's Portfolio Construction

Upon signing up for the managed portfolio service, users answer a series of questions designed to assess their risk appetite, financial goals, and investment time horizon. Based on these answers, InvestEngine recommends a portfolio tailored to the investor's preferences. Portfolios are assembled using low-cost ETFs to provide broad diversification across asset classes and regions.

InvestEngine uses a model known as Modern Portfolio Theory (MPT) to build its portfolios. MPT is an investment framework that aims to maximize returns for a given level of risk by finding the optimum combination of assets. Portfolios may include ETFs tracking equities, bonds, commodities, property, and cash equivalents.

How Does InvestEngine Compare with Other Robo-Advisors?

InvestEngine is a relatively new player in the robo-advisor market, so how does it stack up against competitors?

1. Fees

InvestEngine's 0.25% annual management fee for managed portfolios is competitive and often lower than other robo-advisors in the market. Coupled with its commission-free DIY offering, InvestEngine represents a cost-effective option for investors.

2. Investment Options

While InvestEngine's reliance on ETFs aligns with the broader robo-advisor industry's trend, its range of investment options remains limited compared to more established platforms. Investors seeking specific niche investments or active management strategies might find InvestEngine's offerings lacking.

3. Customer Support

InvestEngine provides customer support via email, phone, and live chat. Although its support offering may not be as extensive as more established competitors, the assistance provided is generally considered adequate.

4. Accessibility

InvestEngine's platform is browser-based, with no dedicated mobile app. This may not appeal to investors who prefer managing their investments on-the-go using a dedicated mobile application.

Who Is InvestEngine Suitable For?

InvestEngine may be an attractive option for investors who:

Are seeking a low-cost, passive investment strategy using ETFs
Prefer a hands-off approach to investing via the managed portfolios
Have a specific focus when constructing their portfolios using the DIY service
Appreciate a transparent fee structure

However, InvestEngine may not be well-suited to investors seeking:

A broad range of investment options, including individual stocks or active management strategies
A dedicated mobile app for managing their investments

Conclusion

InvestEngine is a promising, cost-effective robo-advisor with a DIY investment platform that can suit various investors. Its competitive fees, managed portfolios, and commission-free DIY platform make it an attractive option—particularly for investors seeking low-cost, diversified ETF investments.

However, it's essential to consider the platform's limitations, such as its narrower investment options compared to larger competitors and the absence of a dedicated mobile app. As with any investment decision, it's crucial to research and compare multiple platforms to ensure you select one that aligns with your specific investment preferences, goals, and risk tolerance.

InvestEngine Review: Is It Worth It?

Overview

InvestEngine's Key Features

1. Managed Portfolios

2. DIY Investment Platform

3. Low Fees

4. Automatic Rebalancing

5. UK-based and Regulated

InvestEngine's Fees and Charges

InvestEngine's Portfolio Construction

How Does InvestEngine Compare with Other Robo-Advisors?

1. Fees

2. Investment Options

3. Customer Support

4. Accessibility

Who Is InvestEngine Suitable For?

Conclusion

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