Capital One Advisors: what do you need to know?
This Capital One Advisors Managed Portfolios review examines the robo-advisor service in more detail, exploring its services, investment policy, fees, and other important considerations.
Summary
Capital One was a robo-advisor service that offered financial planning, advice, investment services, and access to certified advisors.
The company exited the brokerage business in 2019 and the financial advisory business in 2022.
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Introduction to Capital One Advisors
Capital One Advisors Managed Portfolios was Capital One’s robo-advisor service aimed at creating bespoke investment portfolios for clients, especially those without much investing experience. The portfolios reflected clients’ risk tolerance and goals. The service offered clients access to a financial advisor during the investing process. After working with the advisor, clients would let the service take charge of their investment portfolio.
Capital One exited the retail brokerage business in 2019 and stopped providing investment advisory services in 2022. E*Trade purchased more than 1 million self-directed brokerage accounts from the service. Capital One Advisors Managed Portfolios is no longer registered and no longer files reports with the SEC or with any US state.
What services do Capital One Advisors offer?
Capital One financial advisors offered a range of products and services, including:
Financial advice
Investment advice
Investment portfolio creation
Individual and joint taxable accounts
Education savings accounts (ESA)
Custodial accounts
Traditional and Roth IRAs
Capital One still offers personal and business banking services.
What is Capital One Advisors’ investment philosophy?
Capital One independent financial advisors' philosophy was to invest clients’ portfolios exclusively in exchange-traded funds (ETFs). The service diversified clients’ portfolios across various asset classes, namely cash, bonds, and stocks, which helped mitigate losses in the event of market shifts.
The service’s philosophy also aimed at making investing as simple as possible for its clients, which ultimately meant a hands-off approach. The service, rather than its clients, would place and alter trades, with portfolios being rebalanced automatically to maintain each client’s unique ideal.
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What is Capital One Advisors’ pricing and fee structure?
With Capital One Advisors Managed Portfolios’ exit from the retail brokerage and investment advisory services business, information regarding its pricing and fee structure is no longer readily available. However, when active, the service was known for charging higher fees than many of its competitors. Furthermore, even though the company courted clients with little to no investment experience, Capital One had relatively high minimum investment requirements.
For example, clients would need to deposit at least $25,000 to start investing with Capital One financial advisors. The service charged a management fee of 0.90% of assets under management, which was higher than that charged by other robo-advisors, which usually charge fees of less than 0.50% of assets under management.
Is Capital One Advisors trustworthy?
Even though it’s no longer possible to obtain financial advice or invest with Capital One Advisors Managed Portfolios, Capital One itself continues to offer a range of services. Among the services still available are credit cards, checking and savings accounts, auto financing, and commercial banking solutions. As a financial institution, Capital One is trustworthy.
However, when Capital One Advisors was still active, some clients found that the website was not easy to navigate, and various services were not explained sufficiently. The website also did not provide specific details regarding ETF fees and features such as tax-loss harvesting.
Even though clients could access their portfolios online, they weren’t able to track their progress toward their goals easily. While this does not indicate that the service was untrustworthy, these frustrations may have eroded some clients’ confidence in the service.
What are the pros and cons of Capital One Advisors?
As with all financial advisory and brokerage services, there were pros and cons to Capital One Advisors.
Pros
Capital One Advisors Managed Portfolios created personalized investment portfolios, taking clients’ risk tolerance and goals into consideration.
Even though this was a robo-advisor service, it also offered clients access to human financial advisors.
A hand-off approach to investing meant clients did not need to place or alter trades, as these were handled by the service. The service also offered automated portfolio monitoring and rebalancing.
Capital One Advisors invested clients’ portfolios in ETFs, diversifying them across asset classes, including stocks, bonds, and cash.
Cons
Capital One Advisors required a $25,000 minimum deposit and charged a 0.90% management fee.
The website was difficult to navigate, provided unclear information, and made it hard for clients to track their progress.
The service did not have enough unique selling points to differentiate it from other robo-advisors and brokerage services.
Capital One Advisors exited the brokerage business in 2019 and the financial advisory business in 2022.
How to open an account with Capital One Advisors?
It is no longer possible to open an account with Capital One Advisors. The service is no longer registered, and it no longer files reports with US states or with the SEC.
Seek expert financial advice
With Capital One still offering banking services, it’s unsurprising that the brand is still associated with financial advice, financial planning, and investing. The continued association of the brand with these services is testament to its popularity among new and inexperienced investors. Even though it’s no longer possible to access the services that Capital One Advisors Managed Portfolios offered, you can access similar trustworthy services.
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