If you’re looking to build a diversified portfolio yourself, but want low fees, and a bit of advice along the way, look no further than MarketRiders.
The do-it-yourself platform works with any brokerage account. MarketRiders works as a digital advisor – advising you on the best way to manage your portfolio.
If you decide you don’t want to manage your own portfolio, MarketRiders also offers a managed service. It’s a bit more expensive than other robo-advisors, but it offers a great service.
Below I review both MarketRiders options for you to see which one (if any) would work for you.
What is MarketRiders?
MarketRiders is a digital advisor. They don’t manage your portfolio, like traditional robo-advisors.
Instead, they customize a portfolio after assessing your goals and risk tolerance. They suggest a portfolio of ETFs based on how much you need to earn and in what amount of time.
You take the advice provided and create a portfolio at your chosen broker. You don’t create the account at MarketRiders – they just provide the digital advice; they don’t hold your funds.
You can manage up to 10 portfolios at a time with the DIY portfolio. MarketRiders also offers a managed service, where they manage your portfolio for you. With the managed account, MarketRiders (and its subsidiaries) manage your account and hold your funds. It’s less of a DIY platform and more of an automated system.
Investors may choose how they want to handle their investments. The DIY version is great for those looking to branch out on their own. MarketRiders offers a bit of ‘hand-holding’ while providing you with the freedom to manage your own investments. It’s like knowing someone has your back.
The managed version is more of a traditional robo-advisor. You answer the same questions, but with the managed version MarketRiders handles your portfolio for you, choosing the investments and reallocating your portfolio as needed.
How does it work?
Setting up an account is simple at MarketRiders.
You answer a handful of questions regarding your risk tolerance and goals along with some personal information. MarketRiders suggests portfolios based on this information. You can adjust the investment recommendations based on your needs until you settle on a portfolio that works.
If you choose the managed version, the account setup works the same way. You answer the questions which determine your risk tolerance and goals, but then MarketRiders manages your portfolio for you.
Deposit and withdrawal
If you use the DIY portfolio, the deposit and withdrawal limits and procedures are up to your chosen platform.
MarketRiders (both DIY and managed) require a $2,500 minimum initial deposit or portfolio.
If you use SogoMarketRider’s automated portfolio system, you can withdraw as much as you need/want at any time. If the amount requested exceeds the amount of cash you have in your portfolio, Sogo will sell ETFs to satisfy the amount.
The MarketRiders and SogoMarketRider’s platforms are easy to use. They are user-friendly, and make it easy to determine where your money is and what you should do. They even offer calculators that help you determine how much you can withdraw from your account without disrupting your portfolio allocation.
You may open a taxable (individual or joint) or retirement account at MarketRiders and SogoMarketRiders. The retirement accounts include traditional and Roth IRAs as well as rollover IRAs.
What can you trade?
MarketRiders invest only in ETFs. They don’t recommend investments in mutual funds or individual stocks. If you aren’t into investing in ETFs, this isn’t the right platform for you as that’s the only asset they trade.
MarketRiders (the DIY platform) charges the following fees:
- $14.95/month or $149.95 per year
- ETF fund fees chosen by MarketRiders usually have average fees of 0.17%
- There is usually a $10 trading commission every time you buy or sell an ETF
MarketRiders has a 30-day free trial if you want to try it out, but you still provide your funding information should you decide to keep the service.
SogoMarketRiders charges 0.75 percent of assets under management with a minimum management charge of $5 a month.
How does MarketRiders make money?
MarketRiders makes money by the fees they charge, whether you use the DIY platform or the managed portfolio. They make money monthly from both services.
Both the DIY platform and managed platform have cash accounts. You can keep a portion of your portfolio in cash if you feel better about having it for emergencies or you just prefer some liquidity. If you request a transfer from either account, MarketRiders first exhausts all cash in your account.
If your withdrawal request exceeds the cash amount, they will sell ETFs to obtain the remaining funds, which may result in more cash in your portfolio depending on how the numbers work out when they sell the ETFs.
MarketRiders doesn’t have human advisors available. They do have online chat and email capabilities, but you won’t get financial advice. The only financial advice they offer is what you get in the platform, which is extremely helpful, but it’s not human advice if that’s what you’re looking for.
MarketRiders has a great section on educational webinars.
Pros and Cons
How does MarketRiders provide you with advice without human interaction?
MarketRiders has a robust algorithm they use to watch your portfolio. When your portfolio needs adjusting, they have one of two ways of helping you, depending on the type of account you have.
If you use the DIY platform, the system alerts you via text or email (depending on what you set up) when you should make changes. It offers the necessary details to help you reallocate your portfolio accordingly.
If you use the managed portfolio, SogoMarketRiders handles the reallocations for you. This means you don’t have to worry about the reallocations yourself, taking the pressure off you.
How does MarketRiders bill the annual management fee?
If you choose the SogoMarketRiders program, you’ll pay a management fee of 0.75 percent of assets under management. MarketRiders bills you monthly, based on your average daily balance.
Everything is included in this fee, though. You don’t have to worry about ‘other’ fees including commissions trade costs, and custody fees.
There is a minimum $5 charge per month. If you don’t have enough assets to cover a fee of $5, you’ll be charged $5 anyway.
How hard is it to set up an account with MarketRiders?
Both processes are simple when setting up an account with MarketRiders. Whether you open up a DIY account or managed account, the process takes approximately 15 minutes.
For both accounts, you need a portfolio of at least $2,500. If you already have portfolios at another broker, make sure it’s worth at least $2,500. If you’re choosing the managed account, you’ll need $2,500 to open an account.
MarketRiders asks simple questions and they walk you through the process carefully. If you have any questions throughout the setup process, you can chat with them online to get help right away.
Who holds your money when you use MarketRiders?
Who holds your money depends on which service you choose. If you use the DIY platform, the broker you have your portfolio with holds your funds – not MarketRiders. For example, if you have a Schwab account, they hold your funds and handle your deposits and withdrawals. MarketRiders only provides the advice to help you manage your account.
If you have a managed account, your funds are held by SogoTrade who is a member of FINRA and has SIPC insurance. SogoMarketRiders and SogoTrade are companies that work together to help you meet your financial milestones.
How many portfolios can you manage with Market Riders?
This is an area MarketRiders really shines. You can manage up to 10 portfolios with one subscription. That means for $14.95 per month you can manage 10 different portfolios rather than paying for 10 portfolios.
Can you use MarketRiders to manage your employer-sponsored 401K?
It depends. In some cases, yes you can, but it’s tricky. Your employer must allow you to manage your own 401K in your own brokerage account for MarketRiders to be able to help. If this is the case, you can use MarketRiders because it will provide you with advice on which ETFs to buy, and then you can execute the trades.
Can you use mutual funds in your portfolio?
MarketRiders only uses ETFs. They can’t change your portfolio from mutual funds to ETFs nor do they recommend mutual funds. Their investment method focuses only on ETFs that work the best for your portfolio. All the advice they provide pertains to ETFs and includes rebalancing instructions to help get your portfolio back on track.
MarketRiders vs Betterment
If you’re looking for a robo-advisor to ‘do the work for you,’ Betterment is a better choice.
MarketRiders is for the ‘DIY’ investor although they do offer the managed version. Betterment’s fees are much lower (0.25% of assets under management).
Betterment uses the Modern Portfolio Theory like MarketRiders, and Betterment focuses on your goals and risk timeline. Like MarketRiders, Betterment rebalances your portfolio when it gets off course.
Betterment has a threshold of 5%. In other words, they rebalance your portfolio anytime it differs more than 5% from your current allocations. Betterment also rebalances your portfolio anytime you deposit or withdraw funds.
MarketRiders has a 30-day free trial.
Worth It or a Scam?
MarketRiders is not a scam and is worth it for the DIY investor. If you want to manage your own portfolio but could use the advice of a professional, it’s the best of both worlds. At just $14.95 a month, it’s a great way to get the advice you need without paying the higher prices of human advisors.
While there are other fees involved, the majority of the costs fall under the monthly fee. MarketRiders is a great transition for the investor who wants to branch off on his/her own but who isn’t quite ready to do it all alone.
The platform is great for the DIYer who wants to be in charge of his/her investments. MarketRiders provides the advice, but it’s up to you to make the investments. It’s the best of both worlds, giving you the freedom you desire.
If you’re thinking about becoming a DIY investor, it’s time to check out MarketRiders. They are the best platform available that allows you to manage your accounts yourself while providing advice at the same time.
Use the following Quiz and find out which robo advisor is best for you.
If you have any questions, please comment below.
Michael is a senior writer at The Robo Investor. He earned his master’s at the Craig Newmark School of Journalism at CUNY, and is currently taking CFP courses at the University of Scranton. He has been an avid finance enthusiast ever since he started investing at the age of 23. Meet the Team