Top managing a portfolio questions

  • Do portfolio managers need to be registered?
    Yes. You need to be a Registered Investment Adviser or a Registered Hedge Fund Manager to manage a portfolio on Covestor's marketplace.
  • How much can I earn?
    There is no limit to how much you can earn. We share the management fees we charge with you. We keep 0.25% of the fee and pass the rest on to you!
  • Does Covestor support currency, futures or options trading?
    Covestor supports stocks and options trading. We do not currently offer currency or futures trading.
  • I am not a US citizen, can I manage a portfolio?
    Yes. Non-US citizens can manage portfolios. You must be registered as an investment adviser in the US with either the Securities and Exchange Commission or one or more US state securities regulators and be able to open a US dollar denominated brokerage account with Interactive Brokers. You are only able to take positions in US listed equities (including ADRs), options and ETFs.
  • How do I send in my performance history?
    We are able to display historical performance history for Registered Investment Advisers and Registered Hedge Fund Managers with track records that are GIPs verified, provided by Interactive Brokers, or - in most instances - audited by a third party. Once you have returned the agreement and portfolio profile form, our Manager Relations team will be in touch about this.
  • Can I use my existing brokerage account?
    Not at this time. Only Interactive Brokers is currently able to provide us with a real-time view into your trading activity and cash position for live replication in accounts. Once you sign up for an account with us, we send you all the information needed to open an Interactive Brokers account linked to Covestor.

Top trial account questions

  • Is there any cost involved in opening a trial account?
    None at all. There is no cost and no obligation beyond completing the brief registration form.
  • Can I deposit more virtual dollars?
    To add more virtual money to your account contact us.
  • Can I reset my trial and start again?
    Yes, contact us to have your account reset with $100,000 in virtual money. You will, however, have no performance history.
  • Can I change my risk score?
    Yes. You can change your risk score at any time in your account settings.
  • How does a client account differ from a trial?
    Client accounts are funded accounts where real trades are executed on your behalf in your own brokerage account. To become a Covestor client account you will be required to open a brokerage account with Interactive Brokers and fund it with at least US$10,000. Learn more about opening a client account and detailed differences between trial and client accounts.

Top general questions

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  • How do I report system abuse?

Top client account questions

  • What are the fees?
    Covestor only charges fees on investments you make in your account.  There are no entry fees, exit fees, load fees or other hidden charges. The only other fees you will be charged are those levied by the broker. Learn more about Covestor Fees.
  • What is the minimum deposit required?
    To open an account you need to fund it with a minimum of $10,000.  If you plan to invest in a number of portfolios, or those that trade heavily we recommend that you fund the account with a minimum of $30,000 to prevent your account being locked under SEC pattern day trading rules.
  • Can I invest in more than one portfolio?
    Yes. You can invest in as many portfolios as you want in a single account. When you sign in to Covestor you can see your positions, both in aggregate and broken out by investment.
  • How long does it take to replicate a trade?
    Typically trades are replicated within one minute. Actual times may vary.
  • Why is there a difference between the manager's performance and my own?
    We call this drift. There are a number of causes of drift including replication time, Risk Score, and stock exclusions. Drift is typically caused by Managers trading outside of the Trading Rules, or in securities that are not replicated for clients. Learn more about Performance Drift.
  • Will I be able to invest in all portfolios?
    The subset of portfolios you can invest in is determined by your risk score as well as the type of account you have opened with your broker. Some Portfolio Managers have opted for accounts with extended trading capabilities (e.g., immediate settlement of trades, ability to use leverage, etc.). If your account does not possess the same abilities, Covestor would not be able to replicate the Portfolio Manager's trades in your account. This is why some portfolios could be unavailable to you. For further details on account types, please contact us.

Top trading options questions

  • How do I become eligible for investing in portfolios that trade options at Covestor?
    To be eligible for portfolios that trade options you need options trading permission at IB. This is an opt-in permission that must be set in the IB account. It involves checking a box to say you have received and read a document by the Options Clearing Corporation. Additionally, to enable options trading in your Covestor account, you will have to sign the enable options screen and acknowledge and agree to all the statements on that screen.

Top Smart Beta questions

  • How are Covestor Smart Beta portfolios different from other portfolios on Covestor?
    The Covestor Investment Management team, under the leadership of Chief Investment Officer Sanjoy Ghosh, manages Covestor’s Smart Beta portfolios. The team is responsible for undertaking a systematic process to select stocks, construct the portfolios, continually monitor for any relevant events and periodically (at least quarterly) rebalance the portfolios.

    The other portfolios on the Covestor platform are managed by third-party investment advisers or hedge fund managers. These portfolio managers fund and trade a proprietary manager-owned brokerage account. In contrast, for each Covestor Smart Beta portfolio, Covestor funds and trades a proprietary Covestor-owned brokerage account. In both cases, each trade made by the portfolio manager (or Covestor) is automatically replicated in clients’ brokerage accounts based on which portfolios the clients have selected to invest in.

  • Why should I invest in a Smart Beta portfolio?
    Smart Beta portfolios are similar in some respects to passive index funds, except that the rules used to construct these portfolios are designed to slightly outperform a conventional passive index fund, particularly when adjusting for risk taken. Smart Beta portfolios typically charge higher management fees than passive index funds. But these portfolios have lower management fees than pure active investment strategies.

    These features make these portfolios suitable for a client that desires exposure to the broad stock market but is not sure which portfolio to pick.

  • What is a 'fractional share'?
    A fractional share is a unit of stock that amounts to less than one full share. More information here Nasdaq

Performance drift