Is it any good? Stockspot Review Australia 2021 – My honest, upfront review of Stockspot as a customer since 2017. I’ll go over what my actual returns have been over the last 4.5 years, what is the app like, how is my money invested, what ETFs I have, how do their fees work, how do I rate the service as a customer.
Get a discount on your Stockspot fees – use code RAYMOCJQ and we both get discount on our Stockspot management fees, learn more here http://bit.ly/stockspotrc
I first heard about robo advisors when I listened to the Tim Ferriss podcast in around 2016-2017. They had sponsorship by Betterment or Wealthfront (I forget which one) and it sounded interesting at the time. I looked into it but they did not service people in Australia, so I looked for an Australian robo advisor service and stumbled upon Stockspot, which is Australia’s first and largest robo advisor.
I started off investing like 5-7k ish to see how it went – I was still new to investing through a robo advisor and ETF investing as well. From there I continued to top up my money over time to the point where I now have $268,000 invested. And at the time of publishing this video I’ll have a second account through my family trust which will have $122,000 in it as well, so $390,000 with Stockspot all up.
In this video I’ll go over:
• Who Stockspot is for
• What do they actually do
• What do they invest in
• What is their approach
• Showing my portfolio, what I’m invested in
• My actual returns over the last 4.5 years
• And more
Learn more about Stockspot (including their portfolio options, fee structures, their team, their ethos and more) here:
Disclaimer: I’m not qualified to give financial advice, see a professional for advice regarding your personal situation. Sharing my experience as a customer only and for entertainment purposes only.
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Good day there, Ray Corcoran here. In this week’s video, we’re going to be talking about a review of the robo-advisor service Stockspot. I’m going to be sharing my experiences, being a customer of theirs since 2017. So it’s been about four and a half years now. It’s overall been a very, very good experience. So Stockspot Australia’s the first and largest robo-advisor service. So you may have seen services in the States like Betterment and other robo-advisor services. Basically what a robo-advisor is, is traditionally, if you had a sum of money that you wanted to invest, you wanted to go to a an actual person, to an advisor to help you decide where to invest that money and all that stuff. Traditionally, that was very inaccessible to a lot of people. It was quite expensive.
With robo-advisor services, they use… There’s still people behind the company, but they use algorithms and they survey you on what your risk profile is, your investing timelines, your goals, all that stuff. Then based on that, they’ll use their own proprietary methodology to give you a portfolio, and it’s going to be 20% this, 30% that, and so on. By doing this, it ends up being… And traditionally they’re usually more focused on more passive investments, stuff like ETFs, Exchange Traded Funds. I’ve got a separate video where I explain all about those.
But basically the general ethos with Stockspot is fees generally erode a lot of returns. Generally following the market and index funds and ETFs, generally will in a lot of scenarios, been a lot of studies that show that they often outperform actively managed funds, especially when you consider the long-term. Very, very few actively managed funds actually outperform just the index over time. So that’s why they’re very, very focused on that. Low cost diversified index funds and ETFs are a really solid option, and I feel the same way. And that’s why I invested with them.
So who is Stockspot best for? In my opinion, Stockspot’s really, really good if you’re beginner to intermediate investor. Obviously if you’re advanced, that’s fine as well. If you’re someone that likes to be like really, really, really hands-on, you like DIYing everything and picking everything and all that and squeezing and dodging any fees, every little cent of a fee and that sort of thing, it might not be for you. But in reality, that’s probably a very small percentage of people. For most people that are looking to invest, they’re everyday people like you and I. They’re not maybe looking to become a stock picking genius. They’re just looking to get a decent return on their money, maybe 7, 8, 9, 10% annually, and they’re focused on their job or their business or whatever. They maybe don’t have the time or desire to learn everything about this stuff, and they just want to be able to send the money there and start making money on it.
Stockspot is a perfect option for that type of person, getting your money working for you. And the best part is you don’t have to pick basically what investments… What’s the ratio of all those investments. So is it 20% this and 5% that. For a beginner, even an intermediate investor, there’s so many different factors to consider, and having a service like Stockspot, where they just handle it, is, in my opinion, invaluable. Something, I talk about a lot on this channel is the importance of just participating and getting in there, getting involved. We want to make sure that we don’t get too caught up in analysis paralysis and people always looking for the best stock or the best app or the best spreadsheet or the best hack. Sometimes you just need to get involved and start putting money in there and start making it work for you. And Stockspot can really, really help you with the part of it where it’s like you’re picking all the different stocks and all that sort of stuff.
So we’ll start with the pros of using Stockspot. So the first thing is pretty decent return. So obviously returns will fluctuate year to year. There’s going to be up years, down year, and all that sort of stuff. For me, I’ll get to my portfolio later on, but for me, just to spoiler alert, I think it was about 9.1% or something like that every single year for the last four and a half years. And it probably would have been… It definitely would have been higher. I actually took some money out and put some money back in at different points. And I was stupid to take out some money just before it went on a really good run to put into something else. But basically if you’re not an idiot like me, you can get quite good returns.
I almost see it… Obviously there’s risk. It’s not just like guaranteed that you’ll get exactly this return, but that’s the case with anything. But I treat it like a super-charged savings account where I know I can transfer money across and I can make 7, 8, 9, 10% with relative certainty in the market. I’m super happy with that, and I don’t have to think about it, which for me, it’s invaluable. Some of the other benefits include they pick all the ETFs for you. So they’re gurus on ETFs and they really look into good performing ETFs, ones with high liquidity, low expenses, a diversified range of them. So there’s a whole bunch of benefits because they handle all that for you. You don’t have to think about any of that.
They also do automatic rebalancing of your portfolio because if you have a portfolio that’s, say, 20% this and 30% that and so on, naturally what will happen is if one asset goes up in value dramatically, then that ends up being a higher percentage of your portfolio. And if you already decided that your portfolio needs to be a certain number of percentages per asset class, then the problem with that is that your portfolio will naturally drift away from that over time as things go up and things go down. So one thing that they’ll do for you is, when necessary, they’ll look at rebalancing your portfolio. So if you’re way to expose in one sector, they’ll sell some off and they’ll put that back into something that hasn’t grown as much and so on.
Some other good things about Stockspot is it has a really, really good app. It’s super easy to use. Very user friendly. Really clear about all the information. Their customer service is amazing. They’ve got onshore customer service. They’ve always been… My experience dealing with them has always been super nice people, which is… It’s just nice. Obviously the main thing for me is the returns, but it’s also nice when the customer service is good as well. It also saves you a lot of time. You don’t have to think about that side of your investing. I think that this is one of the best benefits of using Stockspot is you just don’t have to think about it. For me, that’s invaluable.
And one of the ways I also think about it is for however many hours I might spend researching stuff or tinkering with stuff myself throughout a year, how much money could I have made in my primary income source, which is my business? How much money could I have made if I didn’t waste all that time trying to figure this stuff out. And some people might say, “It only takes a few minutes here and there.” For me, I feel like that’s probably not going to be the case. And I don’t know about you, but for me, I always end up spending way more time than I probably should researching stuff and looking into stuff. So for me, I know that my time is better spent, I’m going to make more money by focusing on my main thing, which is my business, and that’s where my strengths lie. And then when it comes to stocks and that sort of stuff, I can just let them handle it. I don’t mind paying them a small fee for that.
A few other benefits in terms of tax, they take advantage of the double tax agreement between Australia and the States. So for your overseas investments, there’s some benefits there. Another thing as well is they reinforce positive investing habits in my opinion. They talk about investing for the long haul, not trying to do anything fancy, following stuff that works, not trying to trade like a madman or anything like that. And I think just generally, my impression of them is that they really have your best interests at heart, and obviously they’re there to make money, but I think that all their marketing communications are all around, in my opinion, positive investing habits, whereas that’s not the case for a lot of platforms. There’s a number of platforms that they do. I think about Robinhood in the States and stuff. Some of these platforms really encourage really buying and selling and rapid trading and stuff because they’re making a lot more money on fees from you doing things that are technically or usually not in your best interest. So it’s just something to think about.
In terms of cons for Stockspot, overall, I’ve found it a great service, so there’s not really any things that I personally found crap. I feel like I’m pretty picky, so I would definitely be sharing like everything, warts and all. But overall it’s been pretty good. I think if you’re someone that likes doing stuff DIY, you probably won’t want to bother. You could be someone that you want to pick the ETFs you want, you already know the type of portfolio that you want to set up and you’re happy to do that and you’re happy to rebalance it yourself. You’re generally happy to do anything that they’re going to do yourself, then you probably save money on fees by doing it that way.
And also some people might say that the fees a little bit high, depending on the balance. There’s certain sweet spots where you might find, depending on the balance that you have with them, where you might find the fees are a little bit high for what you get. That one’s, I guess, a little bit subjective. For me, you go on their website and look at the fees upfront as well, and just to remind you, you don’t pay brokerage fees with Stockspot. So you can go on their site and type in whatever balance that you would expect to put in or expect to get to, and that will tell you upfront exactly what the fees are going to be. So for me, I’m sure that there are some people out there that would be like, “I can save money here and here and here.” And if that’s you, then that’s fantastic. For me personally, the fees are negligible for what I’m getting out of it and the amount of time I’m saving and also the returns, I guess, more importantly have been good in my opinion, for, I guess, the work that I’ve done, which is zero.
Next thing is what are you actually investing in? So I’ve done a separate video on Exchange Traded Funds, and I’ll put a link in the comments to explain that, but basically there’s five main asset classes that you’ll be investing in with Stockspot. First is Australian shares. Second is global shares. Third is emerging markets, so Brazil, Russia, India, China, there’s a few others as well. And then the more defensive assets like bonds and gold. So they’re the five main asset classes that you’ll be investing in with Stockspot, and the percentage split of those will vary depending on which, I guess, profile that you end up coming out of. So they’ve got different themes and different profiles that you’ll be assigned depending on what your answers are in the survey when you sign up.
In terms of joining, it’s pretty straightforward. I obviously joined a few years ago, but even back then, it was very, very simple. You go on there, create an account, fill in your personal details, verify your identity. They’ll create the accounts as well. Also once you’ve filled all that out, you filled out your survey in terms of your risk profile, you’ll be assigned a type of account. So for me, I’m on Topaz, which is the most aggressive. Obviously I’m young, and I’ve got plenty of time ahead of me and I really, really don’t want to grow it. Whereas someone that would be older would probably go for a bit more of a conservative portfolio with less risk. My portfolio probably goes like this, more dramatic changes and upwards, whereas theirs would probably go upwards at a slower rate, but they would have less variance as well.
It’s a bit of a trade-off. Obviously pick whatever suits you and they’ll also give you advice as well and check in for certain… Depending on which level of account you get, you can get advice on a regular basis in terms of is this still aligned with your goals and your objectives? And another thing I didn’t mention before in the pro section as well is that you own… This is critical. You own the assets that you’re investing in. It’s CHESS sponsored, which means you get your own holder, you get your own HIN, which is a Holder Identification Number, which basically is a fancy way of saying that when you invest with them, you are still the owner of those assets, which is an important distinction, because there’s a lot of services out there that maybe are stock trading services where you don’t actually own the assets, as crazy as that sounds, because it’s all owned as a one big bucket. All the assets are owned in one big bucket.
It’s important to understand that the reason this is also important is that if Stockspot was ever to collapse, you would still own all your assets. Whereas some of these other ones where you don’t technically own the asset, if they were to collapse, your assets are actually at risk. So just a little distinction to make. It’s pretty important, especially if you started investing larger sums of money. So in terms of my portfolio, I love seeing what other people’s portfolios are. I don’t know if I’m just a bit of a weirdo like that, but I thought… Not as a flex or anything, but more just as transparency for the channel. So my portfolio at the moment has around… At the time of filming has around 260,000 in it at the moment. I’ve recently topped up some money in there. But the return on the money that I had invested with them has worked out to be about $45,000 in returns that I’ve gotten since joining.
And obviously in the early years, I had less in there. I started off with about 5 or 7,000 early on, and I’ve just been adding money over time. So obviously when March last year hit, I topped up again, and then it went on a bit of a run. My returns actually would have been even higher if I had not been taking money in and out all the time, which is stupid, and you shouldn’t do that, basically. So if you do have an account with them, I would recommend not doing that because you can actually really hurt your own returns. I’m on Topaz, as I said, which is the most aggressive portfolio. So that generally gets… From their historical returns, that’s got the best returns, probably with a bit more volatility compared to the lower returning ones. But yeah, I’ve been super happy with it and I don’t have to think about it ever, which has been amazing.
So I hope you found that useful. Overall I really, really like the service. I wouldn’t say that about many services, to be honest, like this. But I think it’s just a fantastic service. The returns have been good. It’s been easy to use. No drama. It’s no hassle. I can focus on what I’m good at and I can leave that side of things to them, and I’m happy to pay a fee to do so. If you do want to join, you’re welcome to use my discount code. You’ll get a slight discount on some of your fees and I’ll also get a discount as well, which is… Which love that. And if you have any questions, please let me know. If you like videos like this, please give a like, please consider subscribing. We do videos regularly on investing, making money, saving money, and all that good stuff. And yeah, that’s it. See you in the next video.