Axos Managed Portfolios review 2023
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Axos Invest: Best for
- Low annual management fee
- Portfolio choices
- New investors
Axos Managed Portfolios brings a solid robo-advisor with premium features to a crowded field, and does so at a reasonable cost. In fact, Axos can boast that its management fee is cheaper than the industry standard, albeit barely cheaper, and yet it offers features such as tax-loss harvesting that are the province of top robo-advisors. Plus, Axos brings a wide range of investments, with more than 30 asset classes, including more niche offerings such as socially responsible funds and blockchain-focused offerings. Investors can get started with a low minimum of $500, and the managed portfolio makes a solid pick for those who have a bank account or another investment account here, allowing them to consolidate it all with one provider. The downsides are few – such as limited account types – but they could be deal breakers, depending on your situation.
If you need a variety of account types, a robust cash management account and tax-loss harvesting, then check out Wealthfront or Betterment, two leaders in the space. Fidelity Go is another robo-player that allows you to consolidate your accounts with one integrated company.
Axos Invest: In the details
Pros: Where Axos Managed Portfolios stands out
Just like other robo-advisors, Axos Managed Portfolios builds an optimal portfolio for you based on your answers to a handful of questions related to your investment goals. Individuals comfortable with some risk-taking and working toward long-term goals will have portfolios weighted more toward stocks, while more risk-averse investors focused on short-term goals will hold more fixed-income assets.
But Axos also allows investors to customize their portfolios to align with their personal interests, choosing from more than 30 different asset classes. There are traditional choices, such as U.S. and international stocks, as well as government and corporate bonds, that make up the bulk of core portfolios. But you’ll also have the option to invest in niche areas like blockchain technology, socially responsible companies and businesses led by women.
This level of customization is rare among robo-advisors and gives something for Axos to hang its hat on. If you’re passionate about how your money is invested, Axos gives you plenty of options to choose from.
Axos also sets itself apart by charging one of the lowest annual management fees in the industry. Investors will pay a flat rate of 0.24 percent each year, which means you’ll pay $24 for every $10,000 you have invested. This annual fee comes in just below that of robo-advisor leaders Betterment and Wealthfront, which each charge 0.25 percent for their basic service.
Keeping costs low is one of the most important things for investors to do because costs eat directly into the investment returns you ultimately earn. The annual management fee at a traditional financial advisor can be around 1 percent, making robo-advisors an attractive alternative.
Investors who use robo-advisors to build their portfolios will also pay fees for the ETFs that are used. High fund fees can sometimes dilute the benefit of a low annual management fee, but that’s not the case with Axos. Fees will vary based on the funds selected for your portfolios, but Axos uses many ETFs with expense ratios of 0.12 percent or less. Many Vanguard ETFs are available including the popular Vanguard Total Stock Market ETF (VTI), which comes with an annual fee of just 0.03 percent.
Axos also offers fractional share investing on both new purchases and reinvested dividends, something not all robo-advisors do. This feature will be especially useful to new investors who may not have significant sums to invest yet. Fractional shares allow you to invest the full amount you’d like to, while not having to worry about purchasing full shares of the ETFs you’re buying.
Fractional shares help to keep your portfolio invested along your desired allocations, maintaining the appropriate weights across your different investments without having to wait until you have enough money to buy a full share.
Tax-loss harvesting and rebalancing
Tax-loss harvesting and automatic portfolio rebalancing are becoming more and more of an industry standard, but it’s nice to see Axos offer these key features. Axos’ tax-loss harvesting automatically sells investments that have experienced losses and replaces them with similar ETFs, allowing your portfolio’s exposure to stay the same, while realizing a loss that will help lower your tax bill.
Axos will rebalance your portfolio when an ETF swings 5 percent or more from the desired allocation. Rather than just selling the ETF that has appreciated beyond its desired weighting, Axos will first use dividends and new deposits to increase the allocations to other funds in order to minimize the capital gains that are generated as a result of rebalancing.
Cons: Where Axos Managed Portfolios could improve
Account types available
While Axos has many features that put it alongside leading robo-advisors, it is severely lacking in the number of available account types. It currently offers individual accounts as well as traditional and Roth IRAs. Offering just three account types puts Axos near the bottom of the industry in this area and compares poorly with top robo-advisors that offer seven or more different account types.
Axos would be wise to add additional account offerings such as joint accounts, SEP and SIMPLE IRAs, custodial accounts and education savings accounts.
Cash management account
While a robust cash management account isn’t a part of Axos Managed Portfolios, you can open one through Axos Bank. That move is easy enough and allows you to keep your business under one roof, but Axos doesn’t offer an interest rate that’s as competitive as those at top robo rivals. Plus, Axos requires you to do a few things to even reach that top advertised rate.
To earn the first 0.40 percent, you must enroll in direct deposit and funnel at least $1,500 per month into the account. To receive the next 0.30 percent, you must either enroll in Axos Personal Finance Manager or use its debit card at least 10 times each month. The next 0.40 percent comes from maintaining an average daily balance of $2,500 in your Axos Managed Portfolios account as well as in a self-directed trading account. The final 0.15 percent comes when you use your cash management account to make a mortgage, personal or auto loan payment. It all adds up to 1.25 percent, below what rivals have been offering.
If this all sounds complicated, that’s because it is. Other top robo advisors offer competitive cash management accounts without all the hoops to jump through.
While Axos has low costs in terms of its annual management fee and the funds it uses to build portfolios, it does charge account fees for a few actions. You’ll pay a $40 fee for terminating an IRA and a $75 transfer-out fee. These fees may seem small, but if you have a small portfolio they can end up being more than what you pay in management and fund fees combined.
If you’re worried about potentially having to pay these fees, you might consider Fidelity Go or Wealthfront, where you won’t face any account fees.
Customer experience and tools
In other areas, Axos offers a competent but not compelling feature set. For example, customer support is available from 11 a.m. to 8 p.m. ET Monday to Friday, or 8 a.m. to 5 p.m. PT, which is basically just standard hours, nothing special.
It’s a similar setup with available tools, such as retirement calculators to help you determine what type of 401(k) to use or another to figure out your retirement savings. They’re easy to use, pleasant to look at and helpful, but Axos could do more here. It does offer quite a few calculators in other areas of its site, such as banking and mortgages, but more planning tools could be useful for its managed portfolios since what is already here is good.
Betterment5.0 Bankrate Score
Betterment offers a high level of service and features across every aspect of its robo-advisor, from its core investment management to low-cost funds to premium features such as tax-loss harvesting. You can also upgrade your service if you need unlimited access to human advisors, and get access to a feature-rich cash management account, too.
Interactive Advisors4.5 Bankrate Score
Interactive Advisors has upped its game this year, with new features such as tax-loss harvesting that put it among the top robo-advisors. That’s on top of one of the widest range of investing choices, low-cost funds and low overall fees. As strong as all these features are, though, the robo-advisor doesn’t offer access to human advisors, not unusual among robo-advisors.
SigFig3.0 Bankrate Score
SigFig keeps costs low whether it’s account fees, fund fees or the annual management fee. You’ll also get access to human advisors and benefit from automatic rebalancing and tax-loss harvesting. But the lack of a cash management account and relatively high account minimums may cause some investors to look elsewhere.
E-Trade Core Portfolios3.5 Bankrate Score
E-Trade Core Portfolios offers a capable robo-advisor, one that may work best for customers looking to keep their accounts with the broker while having someone do the investing for them. Clients will get low-cost funds as well as less-common choices such as socially responsible funds, though the service doesn’t offer tax-loss harvesting or many tools.
Titan Invest3.0 Bankrate Score
Titan offers something unusual in the robo-advisor space: Titan combines its own actively managed investments with passively managed ETFs, something no other major robo-advisor does. It also hedges those portfolios, does not charge a management fee for the passive funds – a rarity among rivals – and has a low minimum, making it easy to get started.
Morgan Stanley Access Investing3.5 Bankrate Score
For younger investors looking to invest based on their values or certain themes, Morgan Stanley’s Access Investing provides a suitable option among robo-advisors. Investors can choose between impact portfolios that focus on environmental, social and corporate governance (ESG) issues, market-tracking portfolios that minimize fees and performance-based portfolios that attempt to outperform through active management.
J.P. Morgan Automated Investing3.0 Bankrate Score
J.P. Morgan Automated Investing provides portfolio management services with automatic rebalancing and may be a good fit for existing J.P. Morgan customers. But you’ll also pay above-average management fees and have limited account types to choose from. There’s also no tax strategy included in the offering.
Vanguard Digital Advisor3.0 Bankrate Score
Vanguard Digital Advisors keeps it simple: an investment portfolio comprised of four funds at a low all-in price, and then adds on helpful tools and educational components. The combination should do well for clients who don’t need a robo-advisor to provide everything under the sun but want competent investment management from a proven and knowledgeable leader.
Fidelity Go4.5 Bankrate Score
Fidelity Go offers a solid robo-advisor offering that beginning and cost-conscious investors will especially appreciate. However, investors looking for features such as tax-loss harvesting or comprehensive goal planning may be disappointed.
Personal Capital4.0 Bankrate Score
Personal Capital customers will get an experience that more closely resembles that of a traditional financial advisor than a robo-advisor, but you’ll need at least $100,000 to get started. You’ll also get a comprehensive tax strategy to help minimize what you owe to Uncle Sam. But this higher level of service does come at an above average cost compared to the rest of the robo-advisor industry.
Stash3.5 Bankrate Score
Stash’s managed portfolios might appeal to small investors who are looking to save as they spend, but the monthly fees can be high for investors who don’t have a large balance built up and there are only a few types of accounts available.
M1 Finance4.5 Bankrate Score
M1 Finance takes some of the best of what brokers and robo-advisors do and mixes it into a new service that provides automated investing in a fully customizable portfolio – all for no cost. If you want to take it up a notch, you can pay an additional fee and receive a host of upgraded features, including one of the best cash management accounts out there.
Wealthfront5.0 Bankrate Score
Wealthfront offers a strong lineup of features – sophisticated portfolio management using low-cost funds – that showcase why it’s one of the leading independent robo-advisors. It provides a strong cash management account, a robust planning tool and premium features such as tax-loss harvesting that may more than pay back your annual fee.
Ellevest3.5 Bankrate Score
Ellevest brings a competent and well-considered robo-advisor, pitching itself to women, whose financial needs are traditionally underserved. But don’t think it won’t work for anyone who needs nuanced investment management, since it offers low-cost funds, socially responsible funds and – unlike most rivals – a flat monthly fee, making it advantageous for those with more to invest.
Schwab Intelligent Portfolios5.0 Bankrate Score
Schwab Intelligent Portfolios provides a top robo-advisor experience that should be a good fit for many investors. The basic plan comes with no management fee and a low-cost portfolio, plus you’ll get Schwab’s top-notch customer support and easy-to-use platform. The premium plan comes with unlimited access to human financial advisors, but both plans come with above-average account minimums and tax-loss harvesting isn’t an option until you reach at least $50,000 in assets.
Acorns3.5 Bankrate Score
Acorns is a good choice for new investors who are starting with small sums of money, allowing customers to build a diversified portfolio with just a few dollars. However, the fees are above average for small account values, though they’ll decline as your portfolio grows, and you won’t find any tax strategy as part of the robo-advisor offering.
Wells Fargo Intuitive Investor4.0 Bankrate Score
Wells Fargo Intuitive Investor is a solid robo offering that gives customers easy access to human financial advisors at no additional cost along with tax-loss harvesting that can help you save on taxes. However, the management fee is above average unless you’re an existing Wells Fargo banking customer.
Ally Invest Managed Portfolios4.0 Bankrate Score
Ally Invest Robo Portfolios are a good option for new investors who pay particular attention to costs. Existing Ally clients may also appreciate having all their finances in one place. Unfortunately, Ally doesn’t offer tax-loss harvesting or provide human advisors to help with those especially difficult questions.
Merrill Guided Investing3.5 Bankrate Score
Merrill Guided Investing offers a credible investing service for Bank of America customers, but its high management fee makes it less attractive among a competitive field of robo-advisors. Merrill offers several positives, including access to human advisors and low-cost investment funds, but premium features such as tax-loss harvesting are missing.
SoFi Automated Investing4.5 Bankrate Score
SoFi Automated Investing gives cost-conscious investors a solid robo-advisor offering that comes with access to human financial advisors at no additional cost. But the lack of tax-loss harvesting and no socially responsible investing options may cause more sophisticated investors to look elsewhere.
Marcus Invest4.0 Bankrate Score
Marcus Invest offers the core feature of a robo-advisor – portfolio management – and then adds some twists, such as several portfolio types, all for a cost-competitive fee. It’s a great add-on for current Marcus customers, though some features of higher-end robo-advisors such as tax-loss harvesting and an expansive toolset are missing.