Our commitment has always been to democratize efficient investment and to do so at very low costs.
But without compromising the quality of our services.
Last year we already made a very significant adjustment to our costs and commissions (2022).
Now, taking advantage of the start of the new year 2023, we are once again making an adjustment to our index fund portfolios.
Reduction in custody costs of index funds
Our custody fees for index funds were already among the most competitive on the market: 0.108% (0.09%+VAT) for the lowest levels and 0.06% (0.05%+VAT) from 1 million euros.
As of January 2023, the custody fee for the lowest tranche below one million euros, where most clients are located, will be reduced to 0.105% (0.087% +VAT).
This can be seen in the table below with the change in green:
This change applies to all index fund portfolios with both standard and SRI management and is effective January 1, 2023.
The weighted average net management cost is 0.25% and the custody cost is 0.10%.
It is good to remember that our customers benefit from several promotions that lower their real costs. One of the most used is the possibility of inviting friends and family, for which they get a bonus of 50 € each.
At the end of 2022, either for this reason or because of the average volume, the weighted average costs, the real average costs that our clients end up paying are 0.25% for the inbestMe management fee and 0.10% for the custody fee, in total 0.35%.
This weighted average cost may drop a few tenths in 2023 after this reduction. This will depend on the volume of invitations and the average volume of accounts at the end of 2023.
inbestMe is the Robo Advisor with the lowest commissions and the lowest real total costs.
As we already reported, inbestMe is the Robo Advisor with the lowest real costs. Taking a detailed analysis and taking into account the total cost of an index fund, our real total costs are the lowest among our competitors.
Not only are we the reference automated manager in Spain for customization, we also have the lowest real total costs than our competitors and 80% lower than traditional services.
As a result, our portfolios are earning about 3% higher APYs than those earned by most investors in Spain. This 2022 this difference has been reduced a bit, but we are convinced that they will return to these records as soon as the markets recover.
It has never been our obsession to appear as the Robo Advisor with the lowest commissions and the lowest (nominal) cost, rather we have focused on offering the best service.
Our services are unique in the financial industry
Beyond the reduction of commissions, we feel it is important to highlight once again what our services include:
Some of our services are unique in the industry (at such a competitive cost), let’s remember the most important ones:
- Management by objectives. In this line, we have incorporated the possibility of contracting a Savings Account to help achieve the objective of obtaining a return on short-term savings and that our clients can complete their virtuous quadrant of financial planning.
- The ability to combine multiple accounts with different investment objectives or styles.
- The possibility of choosing different investment styles, Standard or SRI for all portfolios. In addition to Dynamic or Value management in ETFs.
- Junior savings or single investment accounts with ISR style.
- Intelligent tax optimization in ETF portfolios.
- The possibility of scheduling recurring automatic contributions from our platform.
- In summer 2022 we implemented the possibility to connect your bank to make easy money transfers from our platform by implementing PSD2/Open banking functionality. By the end of 2022 the easy transfer was extended to Europe.
- At the end of January 2023 we have incorporated the possibility of connecting your financial institution to make easy transfers of funds or pension plans.
- Our portfolios are indexed but managed. That is, our committee monitors them and periodically (usually annually) may make adjustments. You can see the latest adjustments made recently. Thanks to the adjustments made in both 2021 and May 2022, our portfolios have fallen less than that of other services, especially in the lower profiles, thanks to the reduction of duration in the bond part.
- Access to the fund comparator from €50,000 and over.
We would also like to highlight the effort made during 2022 to improve the customer area. Since then we have made other small improvements and we are preparing additional improvements for 2023.
Finally, we would like to highlight as unique our inbestMe Plus service accessible from positions over 100,000 € with access to an assigned personal manager at no additional cost. This is a type of service normally reserved in private banking for assets of 1 million euros or more.
We are reviewing other costs
Independently of what we are announcing right now, we are analyzing the other costs and we do not rule out announcing any further changes during the year.