Interactive Advisors offers an online investment platform through which its clients can invest in two types of portfolios:
(1) Manager Portfolios – trading strategies managed by third-party portfolio managers
(2) Interactive Advisors (IA) Portfolios – proprietary investment portfolios designed and managed by Interactive Advisors itself
This piece provides more information about the second type of portfolios listed above. The IA portfolios are proprietary investment portfolios designed and managed by Interactive Advisors itself. At this time, these in-house-constructed portfolios include the following sub-categories of portfolios:
Smart Beta Portfolios
Each Smart Beta portfolio seeks, as its investment objective, to achieve total returns that exceed the total returns of certain market-capitalization-weighted indices, such as the S&P 500, by relying on systematic rules-based investment strategies that do not use conventional market capitalization weights. They are designed to provide systematic exposure to a fundamental factor or combination of factors, and employ alternative weighting schemes based on measures such as value, growth, quality, and dividend yield.
At this time, IA offers a total of fifteen Smart Beta portfolios including their five ESG equivalents (see section on Socially Responsible Investing below).
Asset Allocation Portfolio
Upon clients’ taking the risk assessment questionnaire and obtaining a risk score, IA recommends the most suitable Asset Allocation portfolio. The Asset Allocation portfolio generally invests in 10-14 Exchange Traded Funds (“ETFs”). IA generally selects the ETFs in each Asset Allocation portfolio to best represent the target asset class while having relatively low management fees and being relatively liquid.
The custom Asset Allocation portfolio feature allows clients investing in the Asset Allocation portfolio to adjust up or down the default ETF allocation, subject to limitations based on the risk tolerance they indicated to us. In addition, Interactive Advisors offers clients invested in the taxable Asset Allocation portfolio the option to use tax loss harvesting (“TLH”) as a value-added strategy.
Index-Tracking Portfolios
Each Index Tracking portfolio is designed to follow certain predefined rules so that the portfolio can track the specified basket of underlying investments of the reference index. Each of the Index Tracking portfolios aims to track the performance of the underlying basket of the index, and is a form of passive investing. Interactive Advisors constructs and manages the Index Tracking portfolios based on data provided by the FTSE International Limited (“FTSE”) and the Frank Russell Company (“Russell”) under licensing agreements. The goal of these portfolios is to allow investors to track the performance of certain specified portions of the US Stock market as represented by the reference index.
At this time, IA offers fourteen Index Tracking portfolios.
Model ETF Portfolios
IA offers four WisdomTree and two State Street/SSGA ETF portfolios.
WisdomTree ETF Portfolios: These portfolios are proprietary investment portfolios constructed and managed by Interactive Advisors based on data provided by WisdomTree Asset Management, Inc. (“WisdomTree”) pursuant to a model portfolio licensing agreement. These portfolios are based on WisdomTree’s Model portfolios, implementing an index-centric approach seeking to add value through both asset allocation and ETF selection relative to composite cap-weighted benchmarks.
State Street/SSGA ETF Portfolios: These portfolios are proprietary investment portfolios constructed and managed by Interactive Advisors based on data provided by SSGA Funds Management, Inc. (“SSGA”) pursuant to a model portfolio licensing agreement. These portfolios are based on SSGA’s Global Tactical Asset Allocation ETF Model portfolios, implementing a tactical asset allocation decision-making process, which includes evaluation of global asset classes.
Socially Responsible Investing Portfolios
Each Socially Responsible Investing (SRI) portfolio seeks, as its investment objective, to invest in a basket of stocks with favorable Socially Responsible Investing characteristics and criteria laid out in the ‘Research’ section of each portfolio page by relying on systematic rules-based investment strategies that do not use conventional market capitalization weights. In addition to financial criteria, these portfolios are constructed using Socially Responsible Investing criteria when selecting investments.
Interactive Advisors offers eighteen SRI portfolios currently.
If you would like to either begin your investing journey or simply explore alternate options in your ongoing journey, refer to the documentation available on our forms and agreements as well as the FAQs for more details about these portfolio lines.
With offerings as diverse as these, and minimums as low as $100 in many cases, there is something for everyone at Interactive Advisors . And signup is easy!
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DISCLOSURES:
Past performance is no guarantee of future results, and all investments, including those in this portfolio, involve the risk of loss, including loss of principal and a reduction in earnings.
Interactive Advisor is a registered investment adviser with the U.S. SEC. Registration does not imply a level of skill or training. Past performance is no guarantee of future results, nor is it indicative of future performance. All investments in financial markets involve risk, including the risk of loss, such as a loss of principal and reduction in earnings.
The content of this page is offered for informational purposes only, does not constitute investment advice, and is not an offer to buy or sell any security or invest in any of our portfolios.
For more detailed disclosures, please review our Legal Disclosures webpage.
