In this fintech enabled financial world, choosing between the apps and products now available online can feel confusing and overwhelming – especially when they all appear to do the same thing on the face of it.
In response to demand for more guidance on how to choose the right one for you, Good With Money has introduced ‘need to know’ product and provider reviews.
Here we look at Simply EQ – an investment platform from positive impact specialists EQ Investors, which enables you to invest entirely online.
Simply EQ aims to make sustainable investing easy and accessible for everyone. It is designed for people who would like some support with their investment choices but who don’t need a full financial plan. You will be taken through a questionnaire to establish your current financial situation and investment goals and the platform will then match you with an investment strategy that suits your individual circumstances. Before you go ahead, an advisor will contact you to check that you are on track to meet your goals and that you are not risking more than you can afford.
EQ’s team of financial advisors will build a portfolio for you and actively manage it on your behalf – this is what distinguishes it from most online investment options which manage your investments passively (ie use algorithms to track the market). You can check how your investments are doing through your online dashboard 24/7, and speak with an advisor at any time about your investments. Your strategy will be reviewed once a year to ensure it still suits your financial situation.
You can choose to open a tax-free Individual Savings Account (ISA), a Junior ISA (on behalf of a child), a personal pension or a general investment account (GIA). It’s also possible to transfer an existing ISA, pension, or other investments across to Simply EQ.
Simply EQ aims to make sustainable investing easy, even for those just starting out. You will be walked through an online questionnaire that asks simple questions to determine which strategy is right for you. To start, you’ll be asked to choose from three types of portfolio – Low Cost (which invests through low cost tracker funds), Positive Impact (which positively screens for environmental and social impact), or Best Ideas (which invests in the ‘best ideas’ unearthed by EQ’s research team. It includes specialist, actively managed funds and passive tracker funds, with an overall aim of beating the market).
You’ll then fill out some questions to determine which level of risk is right for you. This takes into account your initial investment amount, monthly contribution, what returns you are hoping for, and how important getting all (and more) of your money back is to you. Based on this information you will be given a ‘risk grade’ and a recommended portfolio. You can choose to accept this, or you can adjust your risk grade manually. If you are deemed to be taking too much risk for your circumstances, EQ will contact you to talk through your situation before you can invest.
Sustainable investing option
One of the three portfolio options from Simply EQ is ‘positive impact’. This portfolio positively screens for social and environmental impact and is designed to maximise your profit while also making a positive difference to the planet and its people. EQ’s Positive Impact Report 2020 outlines how the companies in its Positive Impact Portfolios are helping to tackle the world’s most pressing issues.
Unique selling points
- The funds offered by Simply EQ are actively managed. This means that once you have chosen your portfolio through the online platform, an experienced investment team will manage it for you. They will call you at least once a year to review its progress. This is in contrast to robo-advisors (ie most online investment options) which use algorithms to manage your investments.
The plus points
- Simply EQ enables you to invest in portfolios, which is the most sensible option for most investors as you are putting your eggs in more than one basket. To keep your portfolio well-balanced, Simply EQ invests across a broad range of asset types (these include equities, bonds, property, commodities, alternatives and cash).
- While Simply EQ makes it easy for anyone to invest, it is aimed at people who need minimal support with making investment choices. For more detailed advice and a full financial plan, it would be best to talk to an investment expert in person.
Cost of use
Simply EQ charges a single annual fee that reduces the more you invest. It ranges from 1.2 per cent for investments under £50,000 to 0.5 per cent for investments of more than £1 million. You will also need to pay a fund charge, which will vary depending on the funds in your portfolio. There is no administration or exit fee. It’s important to check the exact fees you will be expected to pay for your portfolio before you agree to go ahead.
How does this cost compare with competitors?
The fact that Simply EQ’s online portfolios are actively managed means they come with a slightly higher charge than their competitors, such as robo advisors Nutmeg and Wealthify which invest passively through low-cost Exchange Traded Funds (ETFs). The higher charge is balanced by the fact that actively managed investments are likely to make a more positive impact than those that are not, and can bring higher returns too.
Similar platforms worth considering are:
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