Managing a portfolio


Thinking of signing up?

  • Do I have to be a Registered Investment Adviser to become a Portfolio Manager on Covestor’s marketplace?
    Yes. You need to be a Registered Investment Adviser (“RIA”) or a Registered Hedge Fund Manager.
  • How can I become a Portfolio Manager and join Covestor’s marketplace?

    If you are either an RIA or Registered Hedge Fund Manager, you may complete the “Become a manager” application available here.

    Once you submit the form, our Manager Relations team will contact you to determine whether you are a fit for the Covestor platform.

    We generally require Portfolio Managers to meet certain minimum criteria (such as AUM and proportion of personal funds invested in the strategy) and to certify that they will not trade ahead of Covestor clients in the other accounts they manage.

  • If it appears I may be a fit to manage a portfolio on Covestor’s marketplace, what are the next steps?

    Covestor will ask you to complete our paperwork. Then you will open and fund a brokerage account with Interactive Brokers - our affiliated broker-dealer.

    That account will be used to track your trading.

  • How much money will I need to place in the brokerage account that will be used to track my trades?
    You’ll need to fund your brokerage account with at least $10,000, and possibly more if your strategy requires it.
  • How much can I earn?
    We do not impose limits on the amount of compensation you may earn on our platform but your compensation depends on the number of Covestor clients and assets they decide to invest in your portfolio. We pass on to you most of the management fees we charge to Covestor clients investing in your portfolio. On standard portfolios, we keep 0.25% of the fee and pass the rest on to you. On portfolios that charge performance fees, we retain 2% of the 2%-12% charged to clients of their investment’s net positive performance.
  • What will Covestor do to market my portfolio?
    We work hard to understand and promote portfolios to our clients. Our marketing team promotes both the platform and individual portfolios in a variety of ways. If you would like additional information on our marketing efforts, please contact Manager Relations.

What are portfolio risk scores?

  • What does portfolio risk score mean?

    Covestor assigns risk scores from 1 to 5 to portfolios it offers on the marketplace. These risk scores indicate the level of risk posed by the investments in each portfolio.

    The purpose of the portfolio risk score is to ensure that the risk level of the portfolio is consistent with client expectations and satisfies client suitability requirements.

    These are the individual risk scores that Covestor assigns to portfolios.

    Risk score 1: This score indicates that a portfolio is less risky than the equity market. Risk score 1 portfolios are long-only and typically have a greater allocation to lower risk securities such as Exchange-Traded Funds.

    Risk score 2: This score indicates that a portfolio has a level of risk similar to the equity market. Risk score 2 portfolios are long-only and typically have a similar risk level to a broad equity market benchmark such as the S&P 500.

    Risk score 3: This score indicates that a portfolio is riskier than the equity market. Risk score 3 portfolios can use leverage, short securities or have concentrated positions.

    Risk score 4: This score indicates that a portfolio is riskier than the equity market. Risk score 4 portfolios are likely to use leverage, short securities or have concentrated positions.

    Risk score 5: This score indicates that a portfolio is significantly riskier than the equity market. Risk score 5 portfolios are likely to use leverage, short securities, have concentrated positions and may experience significant losses at various times.

  • Why do you impose trading rules on Portfolio Managers?
    As an SEC-registered investment adviser, we have a fiduciary responsibility to our clients to ensure that we act in their best interests. Our trading rules seek to ensure that our clients are not unduly exposed to risky or unsuitable trades.
  • Do I have to disclose my identity?
    Yes. When managing a portfolio your identity must be disclosed both to us and to our clients.
  • If you have access to my account do you execute trades or withdraw funds?
    No. We have a limited view into your account, for the sole purpose of monitoring your trading activity to enable us to maintain your portfolio on Covestor.
  • Do I have to reveal all of my trades and holdings?
    No. As a Portfolio Manager, you can choose to keep your holdings and trades hidden from all but logged-in clients and/or clients invested in the strategy.
  • Does Covestor support currency, futures or options trading?
    Covestor supports stock and options trading. We do not currently offer currency or futures trading.

Opening an account

  • 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 establish positions in US listed equities (including ADRs), options and ETFs.
  • Do I have to fund a brokerage account or can I just enter signals?
    You have to open and fund a new brokerage account to manage a portfolio on Covestor. One of the core principles of Covestor is that the Portfolio Managers stand behind their strategies by having their own capital at risk, as do the clients who invest in those very same strategies.
  • Can I use my existing brokerage account?

    If you currently have an account with Interactive Brokers, you may be able to use that account and link it to Covestor or open another IB account.

    If you do not have an existing account with Interactive Brokers, you will need to establish one there before being able to offer a portfolio on Covestor.

    With your permission, Interactive Brokers is able to provide us with a real-time view of your trading activity and cash position for purposes of live replication in client accounts investing in your portfolio.

    Once you sign up to manage a portfolio on Covestor, we send you all the information needed to open an Interactive Brokers account linked to Covestor.

  • How do I send in my performance history?
    We are able to display historical performance history for RIAs and Registered Hedge Fund Managers with track records that are GIPS-verified, provided by Interactive Brokers with your permission or, audited by a third-party accountant or auditor. Once you have returned the agreement and portfolio profile form, our Manager Relations team will contact you about this.
  • How do I submit the agreement?
    Contact our Manager Relations team, fax the agreements to 1.857.453.4530 or email them to managerrelations@covestor.com.

Already signed up?

  • My portfolio doesn't look up to date.
    Portfolio profiles and performance are updated in time for market open the following trading day. This allows us to apply corporate actions (dividends, stock splits etc.) and reconcile our records to those of Interactive Brokers.
  • I have a question about my portfolio’s performance.
    Contact us with all questions about your portfolio’s performance.
  • Are benchmarks assigned to individual portfolios?
    Benchmarks relevant to each portfolio are assigned by Covestor based on overall strategy, portfolio trade history, and/or other criteria as determined by Covestor.

Managing my account

  • Can I manage multiple portfolios?

    You may manage multiple portfolios on Covestor, but you are still required to satisfy our minimum criteria (including AUM and proportion of personal funds invested in the strategy) across all those multiple portfolios to do so.

    Most managers only manage one portfolio on the Covestor platform. You may contact Manager Relations to determine whether you meet these criteria and could manage multiple portfolios. Managers who wish to run more than one portfolio need to submit a new Portfolio Risk Form, and open and fund a new account at Interactive Brokers, exclusively associated with the new portfolio.

  • How can I market my portfolio?

    Feel free to share or link to your profile on Covestor. We can also provide you with a customized widget to use on your website or marketing materials.

    If you submit content for Covestor’s Smarter Investing blog, you can republish it on your own blog or website. In many cases, you may also share media mentions and article placements that Covestor obtains for you.

    Marketing Guidelines to protect your legal status are available on request from Manager Relations.

  • Can I remove my portfolio?
    Yes, you may ask Covestor to remove your portfolio from the platform at any time upon 30-day written notice. Please specify in your written notice your name, the name of your portfolio and the reason you wish to remove your portfolio from the platform.