Wealthfront has announced the expansion of its range of investment offering to include hundreds of options, including two cryptocurrency trusts: Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE).
The asset management service is thus going forward with its plan of allowing customers to gain exposure to cryptocurrency as part of a diversified portfolio with automation features like tax-sensitive rebalancing, intelligent dividend reinvestment, and our Tax-Loss Harvesting.
The automated investment advisor has recently made it possible to customize a Wealthfront portfolio and now it has joined the crypto bandwagon without the need for a wallet: instead of buying coins, users can add GBTC and ETHE to their portfolio with a combined allocation of up to 10%.
“We limit your allocation to GBTC and ETHE because, as a fiduciary, we act in your best interests at all times, and these investments can be riskier and more volatile than most ETFs”, the firm explained.
“GBTC and ETHE round out our significantly expanded menu of investment options. For example, you can now choose from a bigger selection of ARK ETFs, pick ETFs that are specific to industries like cannabis or self-driving cars, or choose from a larger pool of socially responsible investments. The choice is yours”.
Wealthfront is a service that automates portfolio management for the maximization of after-tax returns by taking advantage of market volatility to lower taxes whenever there’s a suitable alternative available. Tax-Loss Harvesting alone typically generates enough tax savings to more than cover the advisory fee, the firm claims.
It allows for customized portfolios as well as expert-built recommended portfolios, or bring over investments from another firm. The firm makes the trades and rebalance users’ investments so allocation doesn’t drift too far over time.
Wealthfront has plans to offer specially curated portfolios for clients interested in socially responsible investing (SRI).
Wealthfront is thus moving its automated investment services to a new stage and more attractive for young investors who want flexibility with their investments and reassurance they are putting their money in the right place to build long-term wealth.
As an SEC-registered investment adviser, Wealthfront is legally obligated to provide advice and information, setting itself apart from other financial apps that do not have this obligation.
Financial literacy advocate and UPenn adjunct professor, Brandon Copeland, has been working with Wealthfront throughout the month of April to help people get over the initial inertia and fear associated with investing and financial planning.