FAQs

Covestor was acquired by the Interactive Brokers Group in May 2015. In 2017, the company began using a new business name to reflect that it is part of the Interactive Brokers Group family.

From July 17 2018, all clients will be able to login using only their Interactive Brokers credentials. With IBKR as well as Interactive Advisors having the same, single login across the two sites, we aim to help simplify and streamline your experience with us.

We discontinued the trial account feature in October 2017. We believe trying Interactive Advisors with an actual funded account provides a more realistic user experience. Many of our portfolios require a minimum investment amount of only $5,000.

Yes. You need to be a Registered Investment Advisor (“RIA”) in order to manage a portfolio on our marketplace.

We do not impose limits on the amount of compensation you may earn on our platform but your compensation depends on the amount of assets our clients decide to invest in your portfolio. Portfolio managers determine the annual management fee for the portfolios they offer on our marketplace after consulting with us. Management fees range from 0.25 to 1.5%. We retain just 0.25% of the management fee and pass the rest to the portfolio managers.

Interactive Advisors supports stock trading. We do not offer currency, futures or options trading.

Yes. Non-US citizens can manage portfolios as long as they can open a US-dollar-denominated brokerage account with Interactive Brokers LLC, and they are registered as an investment advisor in the US with either the Securities and Exchange Commission or one or more US state securities regulators and their jurisdiction does not prohibit us from opening an account for them. You will be able to establish positions only in US listed equities (including ADRs) and ETFs.

Portfolio managers may submit fact sheets or other information about their strategy that do not contain performance information, which we will analyze and consider displaying on the portfolio page with appropriate disclaimers. Due to the difficulties associated with meaningfully presenting and explaining historical performance information for portfolios on our platform, we no longer accept or display such information on our website.

To enable us to replicate trades in your brokerage account you must open a managed account with Interactive Brokers LLC and authorize us to trade in it on your behalf. Once you sign up for an account with us, we send you all information needed to open an Interactive Brokers LLC account linked to Interactive Advisors.

Currently only US residents can open Interactive Advisors accounts. Your country of legal residence is the country where you maintain your permanent home or the country you plan to return to if you live abroad for a short period of time. Advisors registered with the US Securities Commission or a state regulator can establish accounts for clients that are US residents.

Interactive Advisors only charges fees on investments you make in your account. There are no fees on uninvested cash in your account or fees to redeem your investments. In addition to our management fees, you will be charged commissions by our affiliated broker-dealer Interactive Brokers LLC. Many of the portfolios on our platform invest in ETFs. For these portfolios, in addition to the management fees (Interactive Advisors charges you) and the commissions (our affiliated broker-dealer Interactive Brokers LLC charges you), the issuer or sponsor of the ETF will also charge you fees and expenses (expense ratio). You will thus pay more when investing in ETFs through us than if you purchased the ETFs directly. Neither we nor our affiliated broker-dealer benefit from the fees and expenses charged by the ETF issuer, and for the in-house Interactive Advisors portfolios that we select the ETFs for we try to invest in ETFs with lower fees. Information on ETF fees are disclosed in the prospectus for each ETF. Learn more about Interactive Advisors fees.

To open an Interactive Brokers LLC brokerage account for your Interactive Advisors investments, you need to fund it with a minimum of $5,000. If you plan to invest in a number of portfolios, or in portfolios that trade heavily, we recommend that you fund the account with a minimum of $25,000 to prevent your account being locked under SEC pattern day trading rules.

Yes. You can invest in as many portfolios as you want in a single account. When you sign in to Interactive Advisors you can see your positions, both in aggregate and broken out by investment.

We call this drift. There are a number of causes of drift including risk score, stock exclusions, and cashflow behavior. Drift is typically caused by portfolio managers trading outside of the trading rules, or in securities that are not replicated for clients due to stock restrictions specified by clients. Learn more about performance drift.

Interactive Advisors offers a large selection of portfolios to its clients. To ensure clients pick suitable investments for their risk profile, Interactive Advisors limits clients’ selection of portfolios using the following four criteria:

• Clients need to have a client account risk score that is greater than or equal to the portfolio they want to invest in.
• Clients need to have enough funds available in their Interactive Advisors-linked brokerage account to invest at least the minimum investment amount, which varies by portfolio and is specified on each portfolio page.
• For portfolios that purchase securities on margin, clients need to have margin permission on their brokerage account.

Some portfolio managers have opted for accounts with extended trading capabilities (e.g., immediate settlement of trades, ability to use leverage, etc.). If your account does not possess the same abilities, Interactive Advisors would not be able to replicate the portfolio manager's trades in your account. This is why some portfolios could be unavailable to you. For further details on account types, please contact us.

The Interactive Advisors Investment Management team, under the leadership of Chief Investment Officer Sanjoy Ghosh, manages Interactive Advisors Smart Beta portfolios. The team is responsible for undertaking a systematic process to select stocks, construct the portfolios, continually monitor for any relevant events and periodically (at least quarterly) rebalance the portfolios.

Together with several other portfolios lines (e.g. Asset Allocation, Index Tracker portfolios), the Smart Beta portfolios are Interactive Advisors in-house portfolios. Other portfolios on the Interactive Advisors platform are managed by third-party investment advisors or hedge fund managers. These portfolio managers fund and trade a proprietary manager-owned brokerage account. In contrast, for each Interactive Advisors Smart Beta portfolio (or any other in-house portfolio), Interactive Advisors funds and trades a proprietary Interactive Advisors-owned brokerage account. In both cases, each trade made by the portfolio manager (or Interactive Advisors) is automatically replicated in clients’ brokerage accounts based on which portfolios the clients have selected to invest in.

Stocks cannot be traded in fractions on public exchanges, which means that you need a counterparty willing to transact with you in fractional shares.

A lockout period starts three business days before each Smart Beta portfolio (or any other in-house portfolio) rebalance and ends right after each rebalance. During each lockout period, we will not allow clients to make any initial, additional or recurring investments in any Smart Beta portfolios. If you request such a transaction during a lockout period, Interactive Advisors will send your transaction request for execution on the first trading day following a rebalance.

Interactive Advisors cannot provide tax advice or prepare tax documents for you. Please consult an accountant or tax attorney to determine the tax-related obligations associated with investing in these portfolios. Please note that Interactive Brokers LLC provides certain tools to assist you with your tax filings, but these tools may only be able to support a limited number of trades.

Log in to IBKR Account Management : Click Reports, Tax, Tax Forms.

Yes, Interactive Brokers LLC mails quarterly activity statements to the address of record you specify for your brokerage account. Do remember to periodically confirm in IB Account Management or in your Account Management window on the Interactive Advisors dashboard that your address of record with Interactive Brokers LLC is accurate and updated. Please also compare the account updates you receive from Interactive Advisors with the account statements sent by Interactive Brokers LLC and promptly inform us of any discrepancies you detect between them.