JP Morgan Chase has announced the launch of ‘You Invest Portfolios’, an automated digital wealth management service (commonly known as a robo-advisor) for banking clients in the US comprising a range of passive portfolios constructed solely using JP Morgan ETFs.
The US robo-advisor space has become increasingly crowded over the past few years.
Clients answer a set of questions about their risk tolerance, financial goals, and time horizon, and are subsequently matched with one of four portfolios: Conservative, Moderate, Growth, or Aggressive.
Each portfolio consists of a mix of equity and fixed income ETFs, as well as cash.
The Conservative portfolio targets a 25%/75% ratio of equity to fixed income exposure; the Moderate portfolio targets 50%/50%; the Growth portfolio targets 75%/25%; and the Aggressive portfolio targets 90%/10%.
The service requires an initial investment of just $2,500 for new clients indicating that JP Morgan Chase is potentially targeting millennials with its new service.
As is increasingly common with robo-advisors, investors will be able to access the service via their mobile phones (compatible with both iOS and Android operating systems).
Jed Laskowitz, CEO of You Invest, commented, “We are excited to share You Invest Portfolios with the goal to make it easy for our millions of digitally engaged customers to get and stay invested in a balanced mix of ETFs in minutes.”
Thasunda Brown Duckett, CEO of Consumer Banking at Chase, added, “Our firm continues to invest in technology and experiences that help customers make the most of their money so that they can make the most of their lives.”
The US robo-advisor space has become increasingly saturated over the years with platforms offered by Wealthfront, Betterment, Morgan Stanley, Charles Schwab, Wells Fargo, BlackRock, Fidelity, Vanguard, and Bank of America Merrill Lynch, to name but a few.
The You Invest platform charges a flat annual fee of 0.35% which includes the cost of investing in the underlying JP Morgan ETFs. By waiving the underlying ETF costs, JP Morgan Chase is offering a transparent fee structure that is competitively priced compared to rival products.
For example, Wealthfront offers one of the lowest annual platform fees of 0.25%; however, this does not include the cost of holding the underlying ETFs. Vanguard’s service charges 0.30%, but it too adds on the cost of investing in its own funds.