A new iPhone app is offering investment recommendations to consumers with as little as $5 of investable assets.
After downloading, Stash Invest asks users some questions and generates a list of investments that match their risk profiles, financial goals and personal ideologies. Rather than automatically allocate assets into a diversified portfolio, Stash lets users pick their own.
There are only 30 investment options available, and all but one are exchange traded funds managed by Vanguard or BlackRock, picked by Stash for historical performance, low fees and managed risk. Stash permits customers to buy fractions of a share, making it possible to offer a $5 investment minimum.
Similar to Motif Investing, investments can be organized according to ideas or ideologies. For example, a person passionate about technology companies can invest in “American Innovators,” while someone passionate about LGBT rights can select “Equality Works.”
The only stock available is Berkshire Hathaway, an option called “Roll with Buffet.”
Stash charges $1 per month for account balances under $5,000, and 25 basis points on anything over that. Stash does not charge commissions.
Stash CEO and co-founder David Ronick said the idea is to let financial neophytes dip their toes into the world of investing.
“Many people are intimidated by investing,” Ronick said. “The terms can be complicated, the choices can be overwhelming, and the prices and fees can be high."
Ronick added that Stash isn’t a “set it and forget it” robo-advisor. A feature of the app called Stash Advisor provides advice, recommendations and support to help users become confident and competent investors. Stash also connects with social media accounts to let investors share investment activity and ask questions.
“We’re tearing down the most common barriers for investors, making investing affordable, approachable and easier for everyone,” Ronick said.
