Axos Invest Review 2021

A Robo Advisor for Self-Directed Investors

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Axos InvestAxos Invest is a robo advisor that gives you the unique ability to choose the investments in your own portfolio. You can even change your investment allocations after your portfolio is created.

But Axos Invest isn't just a robo advisor. It's recently added Self-Directed Trading, an investment product similar to those of other major investment firms. This product provides self-directed investing with managed portfolio options.

Keep reading to find out more about Axos Invest and what it has to offer.

Commissions & Fees - 7
Customer Service - 7
Ease of Use - 8
Tools & Resources - 8
Investment Options - 10
Asset Allocation - 10

8.5

Overall

Axos Invest Managed Portfolios is a good choice for investors who are looking for the combination of self-directed investing and automated investment management. You can choose the asset classes you hold in your portfolio, as well as the percentage allocations in each.

With Axos Invest you can invest with as little as $50. You can either have a portfolio created for you or design one yourself. Or buy individual stocks, exchange traded funds (ETFs), mutual funds, options and more. Enjoy low-cost automated investment management of your account. Or have complete control over both investment selection and management with Axos Invest Self-Directed Trading.

Axos Invest offers many options. It is a robo advisor that also acts as a commission-free online broker. And it even offers banking services. It's pretty much a one-stop service for your financial needs.

What Is Axos Invest?

Axos Invest came about in 2019 when its corporate parent, Axos Financial, Inc., acquired robo advisor WiseBanyan. In October that year, the platform was officially renamed “Axos Invest.” As a result of the transition, few of the qualities and features of WiseBanyan remain intact. Axos Invest has been redeveloped into its own unique investment service.

Axos Invest has two primary programs on the investment side. Managed Portfolios are automated investing accounts. And the Self-Directed Trading option allows you to choose and manage your own investments.

Axos also offers banking and lending services, making it a comprehensive financial platform. It offers checking, savings and money market accounts, as well as home loans, personal loans and auto loans.

The Axos Invest Robo Advisor: Managed Portfolios

On the one hand, Axos Invest is a true robo advisor. But it offers investors the ability to choose — and modify — the investments in their portfolio. You need $500 to open a managed account.

Using Axos Invest as a robo advisor, you invest in exchange-traded funds (ETFs). However, Axos offers more than 1,400 ETFs, which is more than nearly any other robo advisor. In this way it offers the best combination of self-directed investing with robo advisor management.

Open a taxable investment account or a traditional or Roth IRA.

And it is unique. Axos Invest departs from most other robo advisors in that it gives investors a very large measure of control over the asset classes held in their portfolios. It is a full robo advisor, but investors have the option to accept a portfolio designed by the service, modify it or build a new one from the ground up.

Axos Invest makes this easy to do with its unusually wide selection of investment choices. Unlike most robo advisors that limit investment options to between six and 12 asset classes, Axos Invest gives investors a choice from more than 30.

Axos Invest Self-Directed Trading

On the other hand, if you prefer to manage your own investments, Axos Invest also has self-directed investing options. With a self-directed account you get access to commission-free trades of individual stocks and ETFs. And it offers low-cost trading of options and mutual funds. (See “How Much Does It Cost to Use Axos Invest?” below for the fee structure.)

It offers trading in thousands of individual listed stocks. But it also allows buying and selling of over-the-counter (OTC) stocks. And with more than 10,000 mutual funds, Axos Invest has one of the largest selections in the industry.

No money is required to open an account, but you need at least $50 to begin self-directed trading. Just as is the case with Managed Portfolios, you can open a taxable investment account or a traditional or Roth IRA.

Axos Elite

Axos Elite is a premium service within Axos Invest Self-Directed Trading. There is a fee for the plan, but it gives you access to the following features and benefits:

  • Enhanced Market Knowledge
  • Extended trading hours, from 4:00 A.M. to 7:00 P.M., Eastern Time
  • Move money instantly
  • Reduced fees on options trading
  • TipRanks Market Research
  • Margin trading

TipRanks Market Research. This service collects, appraises and ranks stock recommendations from thousands of financial analysts. It includes trending stock data by sector, as well as stock scores, portfolio trackers and the ability to track your favorite experts' advice.

Margin trading. This service is available with Axos Invest Self-Directed Trading, but you must sign up for Axos Elite to use it. You need a minimum of $2,000 in account equity, but you can borrow up to 50% of the cost of the securities you invest in. That allows you to buy up to twice as much of a stock.

Who Is Axos Invest Best For?

Axos Invest is clearly designed for investors looking for strong elements of self-directed investing with the benefit of low-cost automated investment management. Axos Invest gives you the ability to select the asset classes of your choice. And you choose the allocation percentage you want held in each. You can even change your investment choices and allocations at any time.

This is similar to M1 Finance. M1 allows you to invest in individual stocks and a larger number of ETFs than Axos Invest offers. And Axos Invest limits the self-directed aspect of the service to a smaller selection of very popular asset classes.

Axos Invest may also be of interest to anyone who wants banking services alongside their investing.

And with its self-directed account and banking services, Axos Invest is a comprehensive financial platform similar to Ally Invest.

Axos Invest Features

  • Minimum Investment: $500 for the Managed Portfolios, but $0 for Self-Directed Trading ($50 minimum to open an IRA)
  • Fees: 0.24% for Managed Portfolios; with Self-Directed Trading, commission-free trades of stocks and ETFs, $1 per contract on options, and $9.95 for no-load mutual fund trades
  • Accounts: Individual taxable accounts; traditional, Roth, and rollover IRAs
  • Available Investments: Stocks, ETFs, mutual funds, and options with Self-Directed Trading
  • Extended Trading Hours: Self-Directed Trading, standard NYSE trading hours (9:30 A.M. to 4:00 P.M., Eastern Time); Axos Elite, extended trading hours (4:00 A.M. to 9:25 A.M. and 4:01 P.M. to 7:00 P.M.)
  • 401(k) Assistance: No
  • Tax Loss Harvesting: Yes, on Managed Portfolios
  • Automatic Deposits: Yes
  • Human Advice: No
  • Socially Responsible Investing: Yes
  • Mobile App: Android and iOS devices
  • Fractional Shares: No
  • Customer Service: Email, In-app messaging

Axos Invest Customer Service

Customer service is available by email and through the app.

The Axos Invest mobile app is available for download from the App Store and Google Play.

The mobile app is rated 4.2 stars out of 5 on the App Store and 2 stars out of 5 on Google Play.

Axos Invest Security

Axos Invest ensures your information is fully encrypted, securely stored and protected by state-of-the-art technology.

Account funds are held with Axos Clearing, which acts as both custodian and clearing agent for transactions within your account.

All accounts are covered by SIPC for up to $500,000 in cash and securities, including up to $250,000 in cash. (SIPC covers losses due to broker failure, not market losses.)

How Much Does It Cost to Use Axos Invest?

For Managed Portfolios, Axos Invest has a single all-inclusive advisory fee of 0.24% of your account balance. There are no other fees or commissions charged, other than expense ratios charged within the ETFs you invest in.

However, there's a different fee schedule if your account balance falls below $500. If so, a flat fee of $1 per month will be charged, rather than the percentage fee.

Self-Directed Trading fees:

  • Stocks and ETFs, commission free
  • Options, $1 per contract
  • Mutual funds, $9.95 per trade for no-load funds

Axos Elite fees:

Axos Elite has a fee of $10 per month. But you'll then have access to margin trading and reduced options trading fees at $0.80 per contract.

Margin interest: 5.50%

Other fees: $50 fee if you close an Axos Invest IRA account. There may be other fees as well, such as transfers and custodial fees. And you may incur other fees if you also use Axos' banking features.

How Is Axos Invest Different?

Axos Invest's Managed Portfolios is the main investing plan that is offered. Similar to other robo advisors, you need to complete a questionnaire to determine your risk score. Based on this risk score, Axos Invest designs a portfolio for you based on modern portfolio theory. It is then fully managed for you. This includes automatic rebalancing and tax protection strategies (see below).

But what makes Axos Invest different is the combination of the Managed Portfolios robo advisor and the Self-Directed Trading plan that lets you have a managed portfolio with the same broker where you engage in self-directed trading.

And another major difference is with Managed Portfolios itself. Yes, Axos Invest will provide complete portfolio management, including dividend reinvestment and periodic rebalancing. But it allows you to choose specific investments as well as change portfolio allocations. Few robo advisors provide that kind of flexibility.

Tax Protection

Most robo advisors these days offer tax loss harvesting (TLH) to minimize the impact of investment-related taxes. TLH is a process of selling losing investment positions to generate losses that offset gains on winning positions. One ETF will be sold off, then immediately replaced by a similar fund to maintain target asset allocations.

Axos Invest offers TLH. But it takes tax protection to a higher level by also offering IRAutomation.

IRAutomation: This feature allows you to set your retirement savings on autopilot. It provides guidance on choosing your IRA and managing your annual deposits. And it even helps you set your annual retirement strategy, including year-end Roth IRA conversions. By automating your IRA strategy, you get the maximum tax benefit those accounts provide.

Goals

Axos Invest offers Milestone accounts. These sub-accounts accommodate specific investing goals. Apart from general investing and retirement savings, this can include saving for a child's college education, the down payment on a home or another medium-term goal.

Axos Invest provides for several types of goals, including emergency fund, retirement, building wealth and new home purchase.

You can use the basic portfolio for the goal. Or customize the asset classes and allocations. There's also an auto deposit feature that lets you create automatic deposits into your Milestone accounts.

Be aware that you can't transfer money between goal accounts at the present time.

Axos Bank

Axos Invest has been part of the Axos family since it acquired WiseBanyan. It fully integrates with Axos Bank. This means you can take advantage of banking services, commission-free trading in stocks and ETFs and the ability to easily transfer money between accounts.

Axos is working to become a one-stop shop for financial services, combining banking, managed investments and self-directed investing all on the same platform.

Axos Bank offers no fewer than five types of personal checking accounts, as well as high-yield savings and a high-yield money market. It also offers mortgages, personal loans and auto loans.

And unlike most online banks, it also offers small business banking, commercial banking and commercial lending. That includes business checking and savings accounts, as well as various business financing options.

Axos Invest Competitors

Highlights Personal Capital Betterment Axos Invest
Rating 9.5/10 9.0/10 8.5/10
Minimum Investment $100,000 $0 $0-$500
401(k) Assistance
Two-Factor Authorization
Advice Automated Human Assisted Automated
Socially Responsible Investing
Personal Capital Review Betterment Review

Axos Invest Pros & Cons

pros

More asset classes — You can invest in over 30 asset classes and even create your own portfolio.

Choose your investments — You can select the specific asset allocations and ETFs you want included in your portfolio.

Wide asset selection on Self-Directed Trading — OTC stocks and more than 10,000 mutual funds, in addition to listed stocks, ETFs and options.

Adjust asset allocations — Decide how much you want to invest in each asset allocation.

Set multiple investment goals — The goal feature lets you establish dedicated accounts for specific investment goals.

Simple fee structure — There's just one fee for all account types and balances.

cons

Limited account availability — There is no option for a joint taxable account, trusts, college savings plans or custodial accounts.

High expense ratios on some ETFs — ETF expense ratios vary and can be high, depending on the ETF.

$1 per contract options trades — Many other brokers are also commission-free and charge only $0.65 per option contract.

No fixed income investments offered with Self-Directed Trading — That includes corporate and government bonds and certificates of deposit (CDs).

Bottom Line: Is Axos Invest Worth It?

Axos Invest Managed Portfolios is a good choice for investors who are looking for the combination of self-directed investing and automated investment management. You can choose the asset classes you hold in your portfolio, as well as the percentage allocations in each.

Axos Invest Managed Portfolios is a hybrid between a robo advisor and self-directed investing. And if you want a greater measure of self-directed investing, you can trade individual ETFs and stocks commission free using Axos Invest Self-Directed Trading. In that way, Axos Invest is the perfect broker, where you can engage in self-directed investing while having at least a portion of your portfolio professionally managed through Managed Portfolios.

On the fee side, Axos Invest is at about the middle of the robo advisor range. In fact, the fee of 0.24% seems intentionally designed to go just one notch below the 0.25% charged by two of the most popular robo advisors, Betterment and Wealthfront.

But Axos Invest may not be suitable to new investors, because it requires a minimum initial investment of $500 for a Managed Portfolio. And since Axos Invest involves a strong element of self-directed investing, it probably is not designed for new investors.

But for everyone else, Axos Invest may provide the perfect mix of self-directed investing and automated investment management.

Kevin Mercadante

Kevin Mercadante is professional personal finance blogger, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry. He lives in Atlanta with his wife and two teenage kids.

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