Based on their guidance, you get to decide in which ETFs you want to invest your money.
An FKD Feature exclusive

Where you stash your cash is a personal decision, and Stash – the app – was built on that very principle. Instead of investing your money in the same portfolio that everyone else has, they guide you to choose your own custom mix of exchange-traded funds (ETFs) to create an investing mix that’s entirely you.

It’s like your own personal Spotify playlist, but instead of just listening to Drake rap about having millions of dollars, you’ll be on your way to (someday) having millions too.

How it works

Stash isn’t entirely different from a roboadvisor, since it also offers a range of ETFs to build a diversified portfolio that suits your goals. The real difference is that instead of recommending a ready-made portfolio, it guides you through the process of choosing your own ETFs, based on a variety of factors.

The Stash team has selected 28 ETFs out of the hundreds and hundreds available, and has written a plain-language description of what each one contains. Based on their guidance, you get to decide in which ETFs you want to invest your money.

Choose your own adventure

We all value different things, but with a standard roboadvisor portfolio it’s hard to opt out of investments with which you don’t necessarily agree. Are you vehemently against investing in defense companies, or tobacco companies?

It’s going to be hard to find a roboadvisor that lets you opt out of it. However, when you’re building your own portfolio, you can easily choose not to buy that defense-based ETF (clearly labelled ‘Defending America’ in Stash) if you don’t want to, and it’s easy to amp up the green energy part of your portfolio at the same time.

Their ETF names are all fresh af, with winners like these ones.

  • Robots Rising, aka the Global Robotics and Automation Index ETF
  • Equality Works, aka the Workplace Equality ETF
  • Enjoy Yourself, aka the PowerShares Dynamic Leisure and Entertainment Portfolio
  • On Cloud Nine, aka the First Trust ISE Cloud Computing Index Fund

You can check out the full list – plus each ETF’s management expense ratio – in this blog post from a Stash user.

Learn as you go

Stash streamlines the process of making your own investing decisions, by providing a clear guide to what’s in each ETF, a visual indication of how risky the investment is, and a clear breakdown of which particular stocks you’re most exposed to by investing in that ETF. It’s a level of detail you’d have to find on your own if you went full DIY, but it’s also the next step in understanding how your investment portfolio really works, and what your money is actually supporting.

Diversified enough

Even though you get to feel like you’re behind the wheel with your investments by choosing your own ETFs, Stash takes away a lot of the stress involved in picking individual stocks, because you’re still buying an ETF. They’re each built out of multiple stocks that fit into the sector or market segment you’ve chosen, so instead of throwing your weight behind one defense company, you’re throwing your weight behind dozens of them.

If one of them has a bad day on the market, you still don’t need to panic – especially since you’re in the investing game for the long haul, not the short term, riiiiight?

Get those low fees

Stash is perfect if you want to keep your investment fees low, because they only charge $1 a month for portfolios under $5,000 – and realistically, what else can you buy for $1 a month? If your portfolio grows beyond that, they charge 0.25%, but that’s still only about $15 a year.

As with any ETF-based service, these fees are on top of the management fee with which each standard ETF comes, but Stash has specifically chosen ones with low fees, so your costs stay manageable.

Start for the price of a latte

I think Stash takes the award for my favorite FAQ of all time, with this gem right here.

“Is there a minimum investment amount required to open an account?”

“Yes, the minimum initial deposit is $5.00.”

Now they’re just showing off, because it’s true: you can start investing with less than the price of a venti pumpkin spice latte. While most individual ETFs are priced over $100 per share, Stash has it set up so that you can buy fractional shares in the ETFs you want, for as little as $5 a pop. Fractional shares are exactly what they sounds like, too: your $5 buys you a fraction of the ETF you’re adding to your portfolio.

Look at you, understanding fancy investment slang already. I guess Stash really is going to make investors out of all of us.


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*This piece is meant only to expand awareness of available financial tools and products and should not be considered an official endorsement of the product or its outcomes by GenFKD.


Posted 11.01.2016 - 03:19 pm EDT