TradeKing Group has formed a new subsidiary called TradeKing Advisors, a SEC-registered investment advisor that offers professionally managed investment portfolios online.
TradeKing co-founder and long-time president and COO Richard J. Hagen, Jr. will take on the role of president and CEO of TradeKing Advisors, which will launch its offering for independent investors seeking professional advice this summer.
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Trusted, Value-based Advisory
TradeKing Advisors intends to offer a new level of value in advisory services with portfolios designed and monitored by the experts at Ibbotson Associates, Inc, a registered investment adviser and part of Morningstar’s Investment Management group.
TradeKing Advisors will actively manage and rebalance client accounts as necessary to keep portfolios in line with Ibbotson’s target allocations. This caliber of portfolio management, once reserved only for the wealthiest investors, will now be available through TradeKing Advisors to investors with balances as low as $10,000.
"We’ve seen through our brokerage business that while many people are very good at self-directed investing and managing their own investments, others struggle," said Hagen. "Many just don’t have the time or expertise to navigate the market’s fluctuations themselves.
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By GlobalDataOthers, particularly younger investors, haven’t had the kind of assets needed to get the attention of a top portfolio manager. TradeKing Advisors will attempt to solve that disconnect by making professionally managed portfolios accessible to more people at all stages of their life at an affordable price."
TradeKing Group CEO Don Montanaro added, "What TradeKing did for online trading, TradeKing Advisors intends to do for online advisory services. We aim to make managed investing simpler and fairer for all investors, while adding a level of trusted customer service one would never expect from an online offering.
It’s the natural next step for our brand and for many of the investors we serve."
Simple and Affordable Portfolio Management
To invest in a TradeKing Advisor portfolio(s), existing TradeKing clients follow this simple online process:
- Answer eight questions online to gauge their risk tolerance and investment time horizon,
- Select one of the recommended model portfolios designed by Ibbotson composed of exchange traded products (ETPs),
- Set up and fund an account online,
- Let TradeKing Advisors monitor and automatically rebalance their portfolio when needed to keep in synch with their target asset allocation.
TradeKing Advisors will offer two groups of portfolios: the Core and the Momentum groups. Each will contain five portfolios that range from conservative to aggressive, and allocate to a variety of asset classes using a combination of historical and current market data involving risk, return and correlation.
The fee for Core portfolios is 0.75% of the account balance annually with a $10,000 minimum balance. The fee for Momentum portfolios is 1.00% of the account balance annually with a $25,000 minimum balance.
For clients with account balances over $250,000 the fees for each portfolio are reduced by .25%. These fees represent a significant reduction from current fees charged for comparable expertise, management and diversification.
