Axos Managed Portfolios Review

Axos Managed Portfolios Review: Best for The Self-Directed Investor

Axos Managed Portfolios is designed for investors looking for low-cost investment portfolios and a range of investment options. With an annual management fee of 0.24% and low expense ratios, Axos is among the leading Robo advisors among its peers. The platform offers 30 asset classes, including blockchain-focused funds and socially responsible options. Here is a comprehensive Axos Managed Portfolios review to help you learn more about the investment advisor.

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Key Features

  • Account minimum: $500
  • Management fee: 0.24% of all managed assets annually
  • Portfolio mix: 10 core ETFs and over 30 assets classes available
  • Fund Expense ratio: 0.03 to 0.40% but most of the funds are 0.12% or less.
  • Account Types: Individual, traditions and Roth IRA
  • Cash Management Account: Basic Sweep account
  • Customer Service: Contact Axos Invest vis Email and Phone 11 a.m. to 8 p.m ET, Monday to Friday
  • Tax strategy: Tax-loss harvesting
  • Rebalancing: available
  • Tools: Calculator for retirement saving, annual fees and event-based planning tools

 

Best For…

Axos has a wide range of asset classes to invest in. However, the platform has a limited number of accounts compared to most industry leaders. Axos is before for:

  • Investors looking for a self-directed investment platform with low-cost automated investment management.
  • Investors who would like to start small by investing in fractional shares.
  • Investors who want banking services alongside investing services

Pros and Cons

Axos Invest managed portfolios stand out from its peers thanks to its wide range of investment options. Here is a look at some of the perks and limitations of investing with Axos.

The Pros

1. Wide Range of Portfolio Choices

Like many other Robo advisors in the market, Axos invest builds the optimal portfolio based on your answers to the question they ask related to your investment goals. Investors that weigh towards risk-taking and long-term goals will have a portfolio with the most stocks, and the risk-averse investors focused on short-term goals will hold more fixed-income assets.

Axos managed portfolios let investors customize their portfolios to align them to their interests. You get to choose from 30 different asset classes. It has traditional choices like the U.S. and International stocks and the corporate and government to build the portfolio’s core. You can also invest in niche areas like socially responsible companies, blockchain technology and women-led businesses.

Axos offer a level of customization that is rare among other Robo advisors. It provides investors very many options to choose from.

2. Fractional Shares Investing

The platform offers fractional share investing for new purchases and reinvested dividends, a rare feature among Robo advisors. This feature is great for beginner investors who would like to start small. Fractional shares allow you to begin investing whatever money you want to purchase without worrying about buying the full shares.

Fractional shares also allow you to keep your portfolio invested along your desired location while maintaining much-needed balance across all your investment without having to wait to get the total amount to buy the whole shares.

3. Low Management Fees

Axos stands out from its competitors by charging the lowest annual management fees in the industry. Investors pay a flat rate of 0.24% p.a. the fee comes in just below the industry leaders Wealthfront and Betterment, who charge 0.25% for their services.

Low management fees are vital for investors because these costs directly affect investment returns. Typically, annual management fees with most Robo advisors are around 1% making Axos an attractive alternative.

4. Rebalancing and Tax Loss Harvesting

Automatic portfolio rebalancing and tax-loss harvesting are now becoming an industry standard. Axos’ tax loss harvesting feature sells investment assets that have experienced losses and replace them with similar ETFs. This allows your portfolio exposure to remain the same while realizing any loss that would help you lower the tax bill.

In addition, Axos will rebalance your portfolio when an ETF swings 5% or more from the desired allocation. Before selling the ETF that has appreciated beyond the weighting, Axos first uses the new deposit and dividend to increase allocation to other funds to maximize capital gains from rebalancing.

The Cons

1. A Limited Number of Accounts are Available

Axos has many exceptional features when placed alongside other leading Robo advisors. However, it lacks significantly in the number of account types available. It only offers individual accounts, Roth and traditional IRAs.

With only three account options, Axos is at the bottom of the industry in this area. Industry leaders offer an average of seven accounts, including custodial accounts, joint accounts, SEP and SIMPLE IRAs.

2. Account Fees

While the platform charges low costs in terms of annual management fees, it also charges other fees for other actions you might need to take to build your portfolio. For instant, you will need to pay a $40 fee for the termination of an IRA and $75 for the transfer-out fee.

Some of these fees may seem small, but for a small profile, they can easily add and end up being more than what you pay in fund and management fees combined.

Coin and Investment Graph

Ways to Invest with Axos Invest

Here are the different ways you can invest with Axos:

1. Self-Directed Trading

Axos Managed portfolios have a wide selection of investments you can choose from if you want to trade on your own. The investment types include ETFs, stocks, mutual funds and options. These are fairly solid choices for anybody who would like to trade with low fees.

Additionally, you can trade ETFs and stocks without commissions, but there will be fees charged on mutual funds and fees. Axos charges $1 for account standard users, while the most competitive platform charges $0.65. Mutual funds will cost you $9.95 per trade.

Axos currently offers individual accounts, traditional IRAs, rollover IRAs and Roth IRAs.

2. Axos Elite

Axos offers a margin trading, but you have to subscribe to Axos Elite to take advantage of the service. Axos Elite is designed for advanced traders who want to access trading perks such as trading for longer hours, market research and analysis, and lower trading fees.

The membership subscription costs $10 per month. Its investment research and market data come from TipRanks. Users enjoy a lower contract rate of $0.80, and you want longer trading hours until 7.00 p.m.

3. Axos Invest’s Managed Portfolios

Axos Invest also offers automated investing services. Its managed automated portfolio services are in line with many industry leaders. The account helps investors build personalized ETF portfolios from the more than 30 asset classes available. The managed portfolios is based on your personal goals, risk tolerance and time horizon.

In addition, the account rebalances your portfolio and makes the required adjustments to keep it on track with your short-term and long-term goals. The account has a minimum requirement of $500, which is a little high when compared with its peers like Ally Invest Managed Portfolios and SoFi Automated Investing.

It also offers tax loss harvesting and can automate Roth and Traditional IRAs.

4. Cash Management Account

While having a cash management account is not part of Axos Invest, you can own one through Axos Bank. With a cash management account, you will earn competitive interest rates on your savings, but there are requirements to reach the top rate level.

To earn 0.40%, you must enrol for direct deposit and deposit at least $1,500 monthly to your accounts. To receive 0.30%, you must register in Axos Personal Finance Manager or use your debit card linked to the account at least ten times monthly. The next 0.40% will come from maintaining an average daily balance of $2,500 in your self-directed trading account and Axos Managed Portfolios account.

You will earn the final 0.15% when you use your cash management account to make your personal, mortgage or auto loan payment.

Axos Vs. Other Digital Investment Platforms

Axos meet the standards for active and passive traders by introducing Self-Directed Trading Account. However, it is the only platform among the industry leaders that offer Robo-advisor portfolios and free trading. Here is a summary of how Axos Invest compares to other industry leaders.

Axos Invest

Axos Invest Fidelity E-trade

Commissions

$0 $0  $0

Min Investment

$0 $0 $0
Min for Robo-Advisor Portfolios $500 $0

$500

Fees For Robo-Advisor Portfolios 0.24% (or $1) 0.00% to 0.35%

0.30%

Banking? Yes Yes

Yes

 

How To Open An Account?

Whichever type of account you want to open with Axos Invest, it will take only 10 minutes to start running. However, before you open an Axos account, you will be prompted to answer a range of investment-related questions to allow the platform to get to know you better.

These scenario-based questions will help the platform assign you a risk score of 1 to 10. One is the low-risk tolerance side, while 10 is the high-risk tolerance. The platform automatically invests your funds in a diversified portfolio that aligns with your risk scores. It is important to note that if you are not comfortable with the risk score Axos Invest assigns you, and you can change it.

Once you are done with the survey, here are the steps to follow:

  1. Click on “Open My Account”
  2. You will be asked to fill in your personal information, including:
    • Email
    • Passwords
    • Employment Information
    • Social security number
  1. Once you are done, you will need to choose an account type. You can choose from the following:
    • Roth IRA
    • Taxable Investment Account
    • SEP IRA
    • Traditional IRA
  1. Once you are done, you need to link your bank account to fund your Axos Invest account. You can start investing with as little as $500. You can set your account to invest every month if you want automatically.

Once you fund your account, it will be sent to Axos Financial for approval. It takes an average of 5 days to have your account approved.

Is It Worth It?

An Axos account is an excellent option for occasional traders. The platform does not provide advanced trading tools that most active and advanced traders would like. However, you will get more features when upgrading to Axos Elite.

However, a brokerage firm offers Axos Elite’s features without paying the $10 fee. Active trades are better off looking for alternatives such as Ally Invest, Robinhood or TD Ameritrade.

Axos Invest Managed Portfolios are competitively priced with IRA account options and goal-setting tools. It is an excellent option for an investor looking for Robo adviser services and does not need access to human advisors.

Happy Businessman

Related Questions (FAQs)

1. Does Axos Have a Mobile App?

Yes. You can view your manage portfolios account from your mobile app, available on android and iOS. However, self-direct trading is not available on the app.

2. How Can I Withdraw Money from Axos Invest?

If you want to withdraw your funds, you must log into your account and send a secure message to the team. After that, the team will begin the account closing process. If you need the team’s help to transfer your funds to another brokerage firm, you will get an ACAT fee of $75.

3. Is Axos Invest Safe?

Yes. Axos Invest has $500,000 in SIPC insurance with a limit of $250,00 in cash. This is the same insurance that covers all the leading brokerage firms in the industry. SIPC ensures that your funds are safe when Axos Invest goes under.

4. How Is Axos Invest Different from Other Brokerage Firms?

Axos’ main investing plan is the managed portfolio account. You will need to open a Robo-advisor account the same way you would for other Robo-advisors. However, Axos Invest allows you to combine your managed portfolio with the self-directed trading plan.

Closing

Axos Invest is a great investment platform for passive beginner traders looking for a low-cost platform with various asset classes. The platform has a minimum investment requirement of $0 for the self-trading account and $500 for the managed portfolios account. It uses the same encryption technology to protect banking customers from ensuring your funds are safe. However, the platform offers few trading accounts compared to its industry peers.

Key Takeaways

  • Axos invest has a $0 minimum investment for the self-trading account and $500 for the managed portfolio account.
  • The platform has the lowest account fees in the market.
  • Axos Invest curate portfolios for investors based on their risk tolerance, time horizon and personal financial goals.

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