While there are a growing number of robo-advisors to choose from, according to Hedgeable reviews, they’re a player who has been around since 2009 who offers a unique approach toonline investing.Born following the dramatic market meltdown of 2008, which saw the Dow Jones Industrial drop by more than 50%, the firm seeks to take the hedge strategies that many of the extremely wealthy used to mitigate their losses and spread them to the masses.
Hedgeable doesn’t employ any complex instruments, derivatives, or other high-risk strategies tohedge the portfolios of their clients, but they do use a strategy designed to protect from catastrophic losses that can hurt your long-term growth and goals.
There is no minimum to get started.In fact, Hedgeable allows new customers to test drive the platform before you decide to put any money into the service. Their portfolio allocations include traditional stocks and ETF’s, and incorporate unique asset classes like private equity, Bitcoin, real estate, and commodities into the platform freeof additional charges.
Here, we’ll examine Hedgeable reviews to help you better understand how their accounts work, pros and cons of their strategy, and to determine if this service is the right place for your investment.
Here is a list of the important basics you need to know if you choose to open an online investment account with Hedgeable.
There isno minimum investment amount to use the service.
The account fees vary depending on the amount you have invested.The prices are higher than competitors in the marketplace but include all the services they provide including their management fee, the custodial fee, product fees, trading costs, analytics, administration, and support.
Available account types include:
Investors create their portfolio based on the individual risk appetite questionnaire.Investment categories can include stocks and ETF’s, as well as their unique investment classes private equity, Bitcoin, real estate, and commodities.
If you’re interested in the private equity class of investments, you’ll be working through their partnership with CircleUp, a leading private equity platform in the marketplace. CircleUp is focused on startups in the retail and consumer space that produce tangible products, allowing you to invest at the ground floor of aspiring new businesses. To allocate funds to this class, you’ll need to be an accredited investor.
Through Hedgeable’s integration with Coinbase, the leading platform worldwide for Bitcoin, you can allocate funds towards managed digital currency atno additional cost.This is one of the features that acts as a hedge against the downside risk sometimes associated with the U.S. dollar and can counterbalance a dollar-dominated portfolio.
Real estate and commodities are another way to counterbalance weakness against the U.S. dollar.These unique opportunities that include precious metals, agricultural products, energy, and real estate can be added to your portfolio at opportune moments, which Hedgeable helps you to identify through their proprietary tools that determine the interaction between asset classes and securities in hundreds of market scenarios and economic environments.
While Hedgeable is a robo-advisor, they challenge the standards of the industry in that they don’t follow traditional investment strategies.Rather than stay in markets that, in theory, should increase in value annually, their active management approach uses tactical security selection and reacts quickly to changing circumstances.They may completely sell out of equity positions to mitigate risk, which you don’t often see in an online platform.
The biggest differentiating factor of Hedgeable is their downside risk protection feature.Through their proprietary technology, they can minimize large losses and offer their investors the option to allocate 100% of your funds into a cash position atany time to preserve capital.
While their strategy is reactive and not predictive, meaning it doesn’t involve market timing and instead reacts to when markets are losing money, in the past, it has resulted in growth compared to losses investors experienced with other robo-advisors.For more information ontheir technique, read their White Paper.
Here is a summary of some of the unique features you can expect if you decide to use Hedgeable as your online advisor.
While not completely unique to Hedgeable, the robo-advisor requires that all new customers submit a survey with answers to five questions that help them construct a portfolio that best meets your needs.These questions address your risk tolerance, income requirements, and overall net worth.Questions include things like:
As detailed above, Hedgeable offers traditional asset allocation options in ETF’s and bonds but also incorporates classes that you don’t often see in other online advisors. Without paying any additional fees, you can choose to diversify your portfolio into private equity, Bitcoin, real estate, or other commodities.
Perhaps the most compelling feature, especially for smaller investors, is Hedgeable’s technological ability tolimit downside risk.Through their proprietary algorithm, their platform can react quickly to market fluctuations and allow investors to take an all-cash position toprotect assets in times of market crisis.
While Hedgeable offers several unique pros for both inexperienced and advanced investors, there are a few cons to consider before making your choice.
Their combined fee structure makes it simple to understand exactly what you’ll pay for the Hedgeable service annually, but for investors with less than $250,000 in play, the fees are very high compared to competitive services.If you weigh them against a competitor, be sure to consider the total in annual fees, as many other robo-advisors will break theirs up into multiple line items.Examine the management fee, the custodial fee, product fees, trading costs, analytics, administration and support fees before making your final decision.
As Hedgeable has only been in play since 2009, after the last large market slump, they remain somewhat untested.According to their internal analytics, their investors see strong performances, but it’s worth noting that we haven’t had a similar market dive to 2008 tocompare.
Hedgeable isan attractive choice for small to mid-sized investors who like the idea of paying a flat fee structure regardless ofhow many services you use.They also have some appealing analytics if you’re someone who enjoys crunching numbers.The robo-advisor’s biggest strength isin their reactive technology, allowing you to minimize your losses should the market take a drastic downturn.As such, they are an excellent choice for new investors who might beskittish about investing money, or seasoned clients who are nearing retirement and don’t want to jeopardize their funds.
Hedgeable attempts to bring the “trade secrets”of the wealthy to the masses, and the platform they provide gives the average investor all the tools they need todo so.Examining the Hedgeable reviews, we’ve concluded that their diverse platform allocation options help them tostand apart from their competitors, and their loss mitigating technology helps to guard against downside returns.Their biggest drawback is the large fees that smaller investors pay, butsomeone who is especially concerned about losing money may find their downside risk protection worth the cost.