“Most retirement investors have got to figure out what to do with their money,” says Mitch Tuchman, the founder and CEO of MarketRiders. Tuchman points out that many of the Baby Boomers getting ready to retire right now are facing an interesting conundrum. “Before, there were more pensions,” he says. “Now Americans are largely saddled with the responsibility of preparing for retirement.”
The aim of MarketRiders, Tuchman says, is to help Americans manage their retirement portfolios more effectively. “We want to solve this problem for those who are 45 to 65, and for younger generations.”
At the same time, though, Tuchman recognizes that many Americans like to be hands-on — at least when it comes to trading. There are plenty of Americans who like the idea of executing their own trades, and being in control of that money, rather than just turning it over to a money manager and hoping that it all works out.
And, indeed, after spending some time on MarketRiders, it becomes clear that this is exactly who the service is for. I received free access to an account for review purposes, and I was impressed with the way MarketRiders helps you build a portfolio that fits your needs.
Building Your Portfolio
MarketRiders offers a free trial, so you can build your ideal portfolio and see how the service works. To start, you have four different options when building your portfolio. You can use a template to begin building your own portfolio, based on portfolios that follow other famous portfolios, you can start from scratch to build your own portfolio, or you can begin by entering the funds you already own, and go from there.
The fourth option is to have MarketRiders build a portfolio for you. This can be a great option for any investor interested in getting help creating a portfolio that matches his or her goals and risk tolerance. “Who does very well in the market over time?” Tuchman says. “We found it was the big institutional investors. The Yale endowment, IBM, Stanford. So we studied these big investors and applied their methods to portfolio creation.”
You answer a few questions about your situation, and a portfolio is created for you. MarketRiders will tell you exactly which funds to invest in, right down to their ticker symbols. Not only that, but you can have your portfolio suggestion tailored according to your preferred brokerage. Share which brokerage you have, and MarketRiders will pinpoint the funds offered by that brokerage — including commission-free ETFs offered. This can save you thousands of dollars in fees over the life of your investment portfolio.
Right now, you have to execute all the trades yourself. MarketRiders will tell you which funds to invest in, and you then go and do so. You can then confirm that you executed the trades on the site. However, Tuchman says that MarketRiders is preparing to add a new feature that makes this process easier. “Soon, you’ll be able to provide your account password, and MarketRiders will pull all the information from your account in for you,” Tuchman says. “This will make it easier to rebalance later, and MarketRiders will have an easier time of keeping you on track.”
As it is, it’s possible to get MarketRiders to help you rebalance your portfolio. As long as you keep up to date with your information in MarketRiders, you can get good help. MarketRiders will alert you when it’s time to rebalance, and show you exactly how many shares to sell of different funds, and what to buy with the money. If you want to add money to your portfolio, you can tell MarketRiders how much you want to add, and it will give you information about which funds to buy to keep your portfolio properly allocated. The same is true if you decide to sell. MarketRiders will suggest the funds to sell — and in what quantity — to keep your portfolio composition in line with your goals and risk tolerance.
|Account Fees||$14.95/month; $149.95/year|
|Accounts Available||Traditional IRA, Roth IRA, Rollover IRA, Trusts, Individual and Joint|
|Customer Service||Phone, Email, and Live Chat|
MarketRiders offers a number of tools, in addition to those that analyze your portfolio and your fees. You can access a mutual fund fee calculator, as well as get access to different mutual fund reports and the mutual fund database. MarketRiders also provides you with an investment report card that lets you see how well various funds have done, according to asset class. MarketRiders also offers a range of educational tools. From helpful hints and explanations as you set up your portfolio, to educational webinars, MarketRiders aims to educate as well as help you figure out how to invest. You can also see your portfolio’s projected performance and the historical performance of a similarly constructed portfolio.
It’s important to note that, while MarketRiders can help you find an adviser, and you are given trading ideas, there is no way for you to invest through MarketRiders. You have to manage the trades yourself. This is not a service in which you use dollar-cost averaging to build your portfolio up over time. (Betterment is a solid choice if you are looking to build your portfolio.) “MarketRiders for those who like to do it themselves,” Tuchman reiterates. “This is for people who don’t want to hand their money over. It’s for people who already have a little more money, who already built up their portfolios and want to effectively manage their money.”
For those who are still in the building phase of the portfolio, it can be a little tiresome to have to go in and add $300 to the portfolio each month. But for those who are interested in managing their money more effectively without turning it all over to someone else, MarketRiders can be very effective indeed.
MarketRiders costs $14.95 per month, or $149.95 per year. Tuchman points out that this isn’t bad when you consider the size of a retirement portfolio. “The bigger the portfolio, the more those annual management fees can add up,” he says. “Ours is a flat rate, so the help you get managing your portfolio is more cost-efficient as your portfolio grows.”
You still have to pay transaction costs and fund fees, but MarketRiders can help you keep those to a minimum as well. The portfolio created for me by MarketRiders results in annual fund fees that cost $152.38 per year. Add in the $149.95, and the total for management is $302.33. That’s a lot better than the $1,123.66 in estimated fees from a mutual fund. And if I have a money manager that takes 2% of my managed assets each year, a $75,000 portfolio would cost $1,500. And, of course, you still have to pay transaction fees. But those are going to be roughly the same, depending on which broker you use, no matter what you choose.
MarketRiders provides a nice mix of DIY investing and investment advice. The idea is that, with a little guidance, you can be your own money manager. You keep more of your money and see better real returns over time.