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Multi-asset brokerage E-Trade Financial Corp. (NASDAQ:ETFC), operating under the E-Trade brand, said on Tuesday has started offering Adaptive Portfolio, a new solution for automated investing in mutual funds and exchange-traded funds (ETFs). The new service is available for clients of E-Trade Capital Management, the securities broking unit of the holding company.
The Adaptive Portfolio tool combines auto trading in actively and passively managed funds with access to human managed account support. The solution is fully integrated with E-Trade’s website, www.etrade.com, and offers information for either mutual funds and ETFs, or ETFs only.
It enables traders to diversify their portfolios based on their own investment objective, time horizon, and risk tolerance, and features automated drift re-balancing.
“When examining the automated investing landscape today, investors typically are limited to passive management strategies,” said Lena Haas, senior vice president of retirement, investing and savings at E-Trade Financial. “With the introduction of Adaptive Portfolio, we aim to kick-start a new phase in the automated investing evolution by offering investors access to more strategies to help them meet their goals.”
To start using it, traders need to complete an interactive questionnaire which assess their goals, risk tolerance, and time horizon in order to identify what type of portfolio suits their trading objectives. The solution consists of six types of main portfolios. In addition, users are offered, based on their responses, a list of recommended asset classes and comparison of their target allocations to other risk profiles.
“We are thrilled to raise the bar with this entirely new way to invest with E-Trade,” said Dave Herbert, senior vice president of retail services at E-Trade Financial. “As a hybrid financial services company focused on digital investing backed by human support, this new offering embodies our strengths. Adaptive Portfolio makes it easy for even the most novice investor to set up a diversified portfolio online, while also providing access to a dedicated team of financial consultants,” he added.
Adaptive Portfolio can be used by traders with minimum account balance of $10,000 for a small annual fee of 0.3% with no separate trading commissions.
In February, E-Trade Financial Corp. published a study which indicated that more than half of US investors would choose a hybrid trading account between digital guidance and human support over accounts managed solely by either a human professional or an algorithmic system.
New York-based E-Trade Financial Corp., offers various financial services, online brokerage and banking services. It works primarily with retail clients through its 30 offices across the US.
The holding company has three subsidiaries – E-Trade Securities for securities products and services, including stocks, bonds mutual funds, options, and ETFs; E-Trade Capital Management for managed account solutions; and E-Trade Bank for bank products and services.