MarketRiders is a web based platform that helps investors build low cost portfolios using exchange traded funds (ETF). Exchange traded funds are a good way to get simple low cost diversification because they typically have lower fees than most mutual funds. MarketRiders works in conjunction with most of the major brokerage firms in the industry.
MarketRiders is new investing software that specializes in helping passive investors build the right exchange traded fund portfolios. MarketRiders goal is to lower your investing costs and fees by selecting the ETF’s with the lowest fees for your investment portfolio. The online portfolio management software has received good reviews from Barrons, Marketwatch, and the New York Times.
Here is a step by step guide to using MarketRiders.
Step 1: Fill Out The Questionnaire
First, you are taking to an interactive questionnaire in which you answer questions that will help the system determine the best ETF portfolio for you. The portfolio constructed is based on your age, years to invest, risk tolerance, and the amount available to invest. Here were a few of the questions:
- How old are you?
- In how many years will you start needing the money?
- How much investing experience do you have?
- How much risk can you handle?
- How much would you like to invest?
I answered the questions to create a portfolio consisting of moderate risk for a person 30 years of age.
Step 2: View Asset Allocation
Next, the MarketRiders system will recommend a portfolio consisting entirely of exchange traded funds for you. The MarketRiders system came up with the following asset allocation strategy based on my selections:
- 40% Bond ETF’s
- 27.63% Stock ETF’s
- 14.87% World Market Stock ETF’s
- 10% U.S. Bonds ETF’s
- 5% Real Estate ETF’s
- 2.5% Commodity ETF’’s
This is known as the Balanced Focus 50% Starter Portfolio. This portfolio has returned 15.23% over the past 12 years. That seems like a good return but it actually underperformed the Dow Jones Industrial Average and the S&P 500.
Step 3: Select Portfolio Recommendations
Finally, the MarketRiders system suggested a variety of Vanguard, iShares, and Spyder ETF’s that will provide investors with the appropriate asset allocation listed above. You can either choose to go with these selections or you can optimize the portfolio to find exchange traded funds with even lower costs.
Once you have selected the portfolio that you want, you can then log into your brokerage account and purchase the exchange traded funds selected for you. After you purchase the shares, you can then enter the price paid on MarketRiders and track your portfolio there.
The MarketRiders service costs $9.99 a month. That is a pretty reasonable price for any investor with a decent size portfolio.
My MarketRiders Experience
I found the platform relatively simple to use and was able to build a number of ETF portfolios really easily. I like the fact that the system does tell you how much you save in fees and estimates your average annual return. MarketRiders will also list your average dividend percentage return as well. The one thing that was lacking was an option to rebalance the portfolio automatically each year. All in all it is a solid option for investors with portfolios of at least $50,000 and that are interested in ETF investing.
If you think that MarketRiders is something that you would be interested in you can get a 30 day free trial now to try it out.