Choosing an online brokerage can be tough with so many options available. But if you want more control over your investments and reasonable trading costs, Motif Investing might be the way to go. I don’t have an account with them, but my research suggests they’re worth considering.
### What is Motif Investing?
Motif Investing lets you create your own portfolio, called a ‘motif,’ made up of up to 30 stocks or ETFs. You can build your motif from a wide selection of funds for a flat commission fee of $9.95. This service is great if you are interested in socially responsible companies, current investment trends, or specific industries.
If you’d rather not customize your portfolio, you can pick from over 100 ready-made motifs for the same fee. These pre-designed options cover a range of industry sectors, and you can still tweak them to fit your needs.
They offer single and joint brokerage accounts, plus fee-free Traditional, Roth, and Rollover IRAs. The minimum investment for a motif is $250, which means you might end up with fractional shares. If you want to trade on margin, you’ll need at least $2,000 in your account.
### Why Choose Motif Investing?
One of the best parts about Motif is the ability to explore before you invest. After signing up, you can browse their motif catalog and create a watchlist to see how different motifs perform. This can help you make an informed decision before opening a trading account.
Their fee structure is clear and simple. The initial fee to buy a motif is $9.95, and any additional trades within your motif cost $4.95 each. There are no management fees or hidden costs, as all expenses are included in the motif pricing.
Motif also offers semi-annual or annual rebalancing for their catalog motifs. You’ll get a notification if there are changes to your motif, and you can choose to apply these changes for $9.95.
An interesting feature is the ability to share your investment ideas with other Motif users on a dedicated platform, similar to a private social network. You control how much information you share through adjustable privacy settings.
### Downsides of Motif Investing
The biggest downside is that Motif Investing doesn’t reinvest dividends automatically. This means you either receive dividends as cash or choose stocks within your motif that pay stock dividends.
Your investment choices are somewhat limited, as Motif currently only offers stocks and ETFs. There’s no word yet on whether they will add options or mutual funds in the future.
While the commission fees are low, they can add up and eat into your profits. Each trade within your motif costs $4.95, and buying, selling, or rebalancing a motif costs $9.95, with a minimum investment of $250.
### Final Thoughts
Motif Investing is a solid option if you’re looking to add something unique to your current investment portfolio. It offers a good mix of customization and pre-made choices, with a clear fee structure and the flexibility to share ideas with a community of investors.