ETFMatic Review 2023

ETFmatic is a UK-based robo-advisor founded in 2014. ETFmatic is the only advisor that provides its service for EU clients which is very unique as most robo-advisors are available only in a few countries.

ETFmatic is regulated by the top-tier FCA and the clients are covered up to £85,000 investor protection amount. 

ETFmatic is recommended for European customers looking for great funding and easy account opening.

Pros:

• No fee for deposit and withdrawal
• GBP, EUR, and USD-based accounts
• Easy and fully digital account opening

Cons:

• Higher fees and minimum deposit
• Limited options to customize your investing goals
• Poor telephone customer support

ETFmatic has average investment fees and low non-investment fees. It charges a management fee and there is also a fee for investing in ETFs. There is no deposit and withdrawal fees.

Which fees you should take into account for robo-advisors? You can see a handy summary of relevant fees here:

Worth mentioning is that personal advisory services, when the robo-advisor's experts advise on how to allocate the assets, have higher Robo-Service fee.

We also compared ETFmatic's fees with those of two similar robo-advisors we selected, Wealthsimple and Betterment. This selection is based on factors like products offered, client profile, fee structure, etc.

Let's start with the investment fees.

Investment fees 

For a better comparison of robo-advisors' Robo-Service and other investment fees, we calculated two benchmark fees, an annual fee for both basic and premium services.

We made this separation because robo-advisors usually offer multiple tiers of their service which differ in fees, minimum investment, and personal advisory. 

• Basic service usually includes a discount or zero fees, low minimum investment, and limited personal advisory services.
• Premium service usually includes higher fees, higher minimum investment, and an option for personal advisory.

In our benchmark calculation, we used a $30,000 account balance for basic and $100,000 for premium accounts.  

ETFmatic has average investment fees for basic services. It doesn't offer premium service. 

ETFmatic charges 0.48% annual Robo-Service or Management fee. The ETF fees range between is exactly 0.12% at the moment. It used to be depending on the assets ETFmatic invests in. 

Non-investment fees

ETFMatic has low non-investment fees. It has no account, deposit, or withdrawal fees. It is similar to its competitors.

There is also a 2% currency conversion fee if you transfer money different than your account base currency.

If you want to transfer your account within the EEA region, no fee will be charged. However, if transferring your account outside of the EEA costs $25.

ETFmatic is available in a lot of European countries. It offers user-friendly and fully digital account opening. The minimum investment amount is low, $100.

Can you open an account?

ETFmatic offers accounts in the following countries: 

• EU countries
• Gibraltar, Iceland, Liechtenstein, Norway

Minimum investment amount

ETFmatic states that the minimum investment amount is €1000 / $1000 / £1000. However, when we tested ETFmatic, we could deposit less than this amount.

Account types

ETFmatic offers a few account types:

• Investment account for individuals
• Investment account for legal entities
• Tax-advantaged ISA accounts for clients in the UK and having GBP-based account

How to open an account

Opening an account at ETFmatic is easy and fully digital. The verification is also fast, our account was verified within 1 business days. However, it was strange that we didn't get a notification when the verification was successful.

What are the steps for ETFmatic account opening? 

1. Give your email address and confirm the link ETFmatic sends you.
2. Create a password for your account.
3. Choose your account base currency
4. Add personal details, like your residence or date of birth
5. Upload documents for verification. Passport, national ID card, and driver's license are accepted for proof of identity. For proof of residence you can upload a bank statement or utility bill.
6. Answer questions about your financial experience, financial situation, and education
7. Add your investment objectives

ETFmatic doesn't charge fees for withdrawals or deposits, moreover, the whole process is easy and convenient. There are also three account base currencies. For deposit, you can use bank transfer and debit cards. 

Account base currencies 

At ETFmatic, you can choose between 3 account base currencies: EUR, GBP, and USD. It equals Wealthsimple’s available currencies, and it’s more than what is available at Betterment.

Why does this matter? For two reasons. If you fund your account in the same currency as your bank account or you trade assets in the same currency as your account base currency, you don't have to pay a conversion fee.

A convenient way to save on currency conversion fees is opening a multi-currency bank account at a digital bank. Digital banks offer bank accounts in several currencies with great currency exchange rates as well as free or cheap international bank transfers. Opening an account only takes a few minutes on your phone.

Deposit fees and options

ETFmatic does not charge deposit fees. Besides bank transfers, you can use debit cards. You can also set automatic deposits.

Withdrawal fees and options 

ETFmatic also doesn't charge withdrawal, however, it is only available through bank transfers. It’s the same for ETFmatic’s competitors.

You have to take in consideration, that fund withdrawals with robo advisors take a long time, at around 6-7 business days.

ETFmatic offers both a web and mobile investment platform. Both platforms have a minimalistic design, offer two-step login, and provide great portfolio and fee reports. On the negative side, it's not always intuitive where you can find some features.

ETFmatic offers in-house built web and mobile investment platforms. They are available only in English.

Web investment platform ★★★★☆

ETFmatic's web investment platform has a clean and minimalistic design. However, some features were a bit hard to find. For example, it took some time until we found how we could add a new investment portfolio. 

Two-step authentication is available. You can set this feature if you go to “Settings > Your profile settings > Additional Security.

ETFmatic has great portfolio and fee reports. You can easily see returns and costs. It's a great plus that you can also see which ETFs the algorithm invested in and what are their expense cost.

Mobile investment platform ★★★★☆

ETFmatic's mobile investment app is available on both iOS and Android systems. We tested the Android version. 

In functionality and design, the mobile platform is the same as the web trading platform.  You can set a safe authentication with touch ID. There are a clear fee and portfolio report. Some features, like setting a touch ID are not the most intuitive. 

ETFmatic offers an average level of personalization with average number of model portfolios. There are great additional features, like the capital gain harvesting. However, these additional tools are available  only for specific accounts, like clients with £50,000 or more account balance.

If you compare the robo-advisors, you should concentrate on the following three questions:

• Personalization: how can you personalize your investment preferences and how many model portfolios can you choose from?
• Asset allocation: what is the distribution of the assets the robo-advisor invest in?
• Extra features: can you benefit from extra services, like an option for socially responsible investing or tax-harvesting?

Let's see the answers for ETFmatic.

Personalization

When you start investing with a robo-advisor, you can usually add your investment goal, risk preference, the investment’s time horizon and target amount. Based on your inputs, the robo-advisor recommends one of their model portfolios and you can decide which one you want to go with. The robo-advisors differ in the depth of personalization and the number of available model portfolios.

ETFmatic offers an average number of model portfolios. The level of personalization are average too.

When you start compiling your investment portfolio, you can set your risk preference. If you click on "Risk gridling", you can also add a time horizon. We also liked that you can customize the asset allocation of the portfolio if you click on "Customize your allocation".

Asset allocation 

ETFmatic invests mainly in UK and North American stocks besides the European governement bonds. Depending on your risk settings, the distribution between stock and bond ETFs are varying.

Additional features

ETFmatic has a great additional services:

• Tax wrapper: a practice which helps you shelter an investment from taxes. It's available only for clients with GBP account base currency.
• Capital Gains Harvesting: it means to strategically substitute ETFs within an index to realize capital gains while maintaining allocation. It's available only for clients having £50,000 or more account balance.

ETFmatic has a great email support, but the telphone support is poor. We missed 24/7 availability and the live chat.

You can contact ETFmatic via:

• Email: we got fully relevant answers within a day. 
• Phone: we tried to call ETFmatic twice, but we could reach them only once. When the customer support agent was successfully connected, we didn't get fully relevant answers.
• Live chat: it's a great new addition, however, painfully slow. We haven't got any answers after 10 minutes, and they rather us to write an email

Unfortunately, customer service is not available 24/7 but they don't offer a time table when you can contact them. Live chat is only available after 3PM usually.

ETFMatic is regulated by the top-tier Financial Conduct Authority (FCA). You are also protected by a high, £85,000 investor protection amount.

Is ETFmatic regulated? Yes, all users are protected by the leading Financial Conduct Authority (FCA) based in the UK.

ETFmatic was founded in 2014. Is it safe? To be certain, it is best to check two things: how you are protected and the background of the robo-advisor.

How are you protected 

This is important because the amount of investor protection differ from regulator to regulator. This is not an issue in this case as all the customers are covered by ETFmatic Limited and the FCA investor protection scheme, called FSCS.

The FSCS investor protection scheme protects against the loss of cash and securities in case the broker goes bust. The limit of FSCS protection is £85,000.

Background 

ETFmatic is quite a young company, it was established in 2014. The longer the track record of any company, the more proof we have that it has successfully survived previous financial crises. 

Being regulated by the top-tier FCA and offering a high level of investor protection are great signs regarding ETFmatic's safety.

ETFmatic is UK-based robo-advisor offering service in a lot of European countries. 

ETFmatic charges no fees for deposit or withdrawal and offers USD, GBP, and EUR account base currencies. The account opening is fully digital and easy. 

On the negative side, the investment fees and minimum deposits are higher. There are a few options for personalizing your investment portfolios. The telephone customer service can be improved. 

As it is easy to open an account and there are no charges for money transfer, feel free to try ETFmatic.