FAQs - Mirroring Accounts

Thinking of Signing Up?

Why Should I Do This?

• What are the benefits of a Mirroring Account?
  Mirroring accounts allow you to mirror in real time the trades that top investors are making with their own money. It gives you the benefit of active management by experts, like a hedge fund, with the safety and security of a managed account.
• What kinds of models are available?
  A wide range of models are available on Covestor, from sector specialists to large professional investor's portfolios. Contact Client Relations if you would like to learn more, or search for models based on your own interests.

How it Works

• What are the fees?
  Covestor only charges fees on subscriptions you take in your Mirroring 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 brokerage. View Mirroring Account Fees
• Are there fees to redeem from models?
  No. Covestor does not charge you to redeem from models but you will be charged transaction costs by the brokerage to close your positions.
• What is the minimum deposit required?
  To open a Mirroring Account you need to fund it with a minimum of $10,000. If you plan to subscribe to a number of models, 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.
• How do I know my assets are held safely?
  Covestor does not act as either custodian or broker/dealer and partners with Interactive Brokers LLC to provide these services on our behalf. Unlike a mutual fund you own the underlying securities which are held in your own brokerage account.
  
  Interactive Brokers is a member of the Securities Investor Protection Corporation (SIPC). As a result, our clients' assets are protected by SIPC, up to $500,000 in value, including $100,000 in cash awaiting reinvestment. SIPC provides protection for brokerage firms against losses should a SIPC member firm fail financially and become unable to meet obligations of its securities clients.
• Can I subscribe to more than one model?
  Yes. You can subscribe to as many models as you want in a single Mirroring Account. When you sign in on Covestor you can see both your positions in aggregate and broken out by subscription.
• How do you qualify the model managers?
  To be made available models have to meet our minimum criteria for participation. They have to have their own money in the model, provide at least a year of performance history and agree to comply with our Trading Rules. More
• How long does it take to replicate a trade?
  Typically trades are replicated within two to three minutes. Actual times will vary.
• What happens if you can't get the shares to short?
  If Interactive Brokers does not have enough stock available to short, you may not be able to replicate the model manager's trade. This will result in Performance Drift.

Opening an Account

• Can I use the service even if I am not in the US?
  Yes. US and non-US citizens of at least 18 years of age are able to open Mirroring Accounts, however we don't currently support UK and Canadian citizens or residents of Japan regardless of citizenship.
• Can I open a joint, trust, corporate or retirement account?
  Yes. You can open an account for whatever entity you choose. As retirement accounts are not permitted to use margin, holders of these can't subscribe to models with a Risk Score higher than 2.
• I hear you need a minimum of $30k to open an account, is this true?
  No. The minimum deposit required to open an account is $10,000. When subscribing to a model which day trades as part of its strategy or if you subscribe to a number of models we recommend you maintain a minimum account balance of US$30,000 at all times.
• Can I use my existing brokerage account?
  Not at this time. To enable us to mirror trades in your brokerage account you must open a managed account with Interactive Brokers and authorize us to trade in it on your behalf. Once you join we send you the right application forms and help you through the process.
• How do I fund my account?
  Interactive Brokers offers a number of ways to fund your account, including by wire transfer, electronic bank ACH transfer and check. A full set of options and instructions is provided when you join.
• Can I transfer positions from my existing brokerage account?
  Yes. You can transfer assets from your existing account to fund your Mirroring Account but we will need to sell all non-cash positions before you can start placing orders.

Already Signed Up?

Using the Service

• I have forgotten my password?
  Enter the email address you registered with and click the Forgotten Password link on the sign in page. We will send you a temporary password that you can reset when you sign back in.
• Where do I enter stock exclusions?
  In the stock exclusions section of Settings in your account you are able to specify individual stocks that you either aren't allowed or don't want mirrored for you.
• What does 'no vacancy' in a model mean?
  No vacancy means that a model is currently closed to new subscribers. Existing subscribers are only able to reduce their subscriptions. If you are interested in mirroring a model that currently has no vacancy please contact us and we will let you know when spaces become available.
• My account doesn't look up to date?
  Your account is updated prior to market open the following trading day. This allows us to apply corporate actions over night (e.g. dividends, stock splits etc.) and reconcile our records to Interactive Brokers.
• Why is there such significant drift between the manager's performance and my own?
  There are a number of causes of drift including replication time and your own Risk Score and exclusions. Where there is significant drift this is largely due to the Manager trading outside of the Trading Rules, into positions that are not mirrored for you. More
• I placed an order to subscribe/redeem a few hours ago. When will the trade orders be executed?
  All orders to subscribe/redeem are processed overnight, and instructions sent for execution to your brokerage at market open the following trading day.
• I was in a model for a few days but got a monthly bill, why?
  Covestor Management Fees are calculated daily and subject to a monthly minimum of $12.50 per subscription.
• I am a risk score 2 and no matter how I answer the questions, I can't seem to get above this?
  If your brokerage account is a cash account you will not be able to subscribe to models of 3 and above. These models can use margin as part of their strategy, and may take short positions.
  
  To upgrade to a margin account, sign in to your account at Interactive Brokers, select Trading Access, then Trading Configuration and lastly Reg-T Margin under Account Type. Retirement accounts are not permitted to use margin.

Managing My Account

• How do I deposit funds?
  When completing your account application with Interactive Brokers their website outlines the various funding options, including Wire Transfer, Electronic Bank ACH Transfer and Check. Instructions are provided for each method of deposit.
  
  Your account can be funded once you have been given brokerage account number. Let us know when your funds have been sent and by what method - we will monitor your account to confirm the funds have cleared and activate your Covestor account.
  
  Interactive Brokers requires you to tell them when you have made a deposit to match incoming payments to your account. To do this fill in a Deposit Notification by signing in to Interactive Brokers, select Funds Management and then Deposits & Inbound Transfers. Alternatively, click this link to be automatically re-directed to the correct page when you have logged in.
• How do I withdraw cash from my account?
  Sign in to your Interactive Brokers Account, select Funds Management and then Withdrawals & Outbound Transfers. Please notify us if you withdraw money.
• Can I change my risk score?
  Yes. Sign in to your account and select the Risk Score tab. You should only amend your qualifying answers when your circumstances change.
• Can I cancel or amend an order to Subscribe/Redeem from a model?
  Yes. Subscription orders can be amended or cancelled prior to midnight Eastern Time on the day they were originally submitted.
• My brokerage account has been suspended due to pattern day trading rules, what do I do?
  If you account has been suspended we will be able close existing positions but not take new positions in your account. We monitor for account suspensions and will contact both you and Interactive Brokers to resolve.
  
  If you plan to subscribe to a number of models, 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.
• How do I close my account?
  Send an email to support(at)covestor.com with your name and Mirroring Account number and we'll take care of it for you. Contact IB direct to close your associated brokerage account.