Acorn is a new investment platform that’s aiming to help people get better at diversifying their investment portfolio, and for the most part it works.
Acorn lets you choose your investments from a variety of mutual funds, ETFs, and ETFs-related funds that offer diversification, and then it uses algorithms to help you pick the best investment opportunities.
The app also offers a free portfolio builder, so you can add as many or as few funds as you want to the mix.
Acorns CEO Andrew Klimas told Quartz that the platform is aimed at helping people “find their niche in the market,” and that the team was looking for “a way to connect with people, rather than a ‘list of investments.'”
Acorns is offering a free suite of portfolio tools, but there are a couple of things you can’t do with Acorn.
You can’t create an index, and you can only add funds to your portfolio once.
That’s a big deal for investors, because if you’re trying to get better diversification you want as many investments in as possible, and it’s difficult to add multiple funds into a single portfolio, so the platform’s portfolio builder will only work with a subset of funds.
But that’s where the company’s investing.
For those who have already created a portfolio, Acorn has built a free tool that lets you create a simple portfolio for free, and if you don’t have the time to create your own, the company is also offering a suite of tools that let you create simple portfolios.
Acronas tools work like this: When you create an account on Acorns, you’ll be able to pick a subset (called the “acorn group”) of funds and add them to your account.
For example, you might create a portfolio of funds for a particular age group, or you could pick a specific fund for each age group and add it to your Acorn account.
You’ll also be able buy individual ETFs in Acorn and invest them.
Each fund will have a number of investment characteristics that you can customize.
You may choose to invest in ETFs that have a higher expense ratio, higher risk-adjusted return, and lower total return.
But Acorn also allows you to set different investment criteria for different funds.
For instance, if you want your fund to pay out more than a certain percentage of your net worth, you can set it to earn less or earn more than your net-worth, and the fund’s portfolio size will determine how much it pays out.
Acrons portfolio builder lets you pick and add funds You can also choose to customize your portfolio.
For the most simple of portfolios, Acorns will let you choose an initial allocation and a minimum investment.
That means you can pick any funds that are within the initial allocation.
For more complex portfolios, you’d probably want to set your own minimum, and that’s what Acorns offers.
For these basic portfolios, there’s no option to create an asset allocation, but you can choose to set a minimum amount of each asset you want Acorns to use, and your investment criteria will then determine the percentage of each of those assets that will be included.
You’re able to choose which fund to buy a particular fund from.
But what about other types of portfolios?
Acorns also lets you add multiple investments to your own account.
The idea is that each investor can also pick the fund to invest from, and those investments will be used to fund a different part of their portfolio.
Acernas tools let you set up a portfolio for a specific age group.
If you want a particular allocation of an ETF, you need to pick the ETF that’s within the age group you want, and Acorns lets you set that.
But for some portfolios, like Acorns’ high-frequency funds, you’re limited to choosing one fund for every age group in the cohort.
For some funds, like a hedge fund, it’s possible to add a specific asset allocation.
But these are limited to certain age groups, and so you’ll need to use Acorns’s tools to pick funds for those age groups.
You also have the option of adding multiple funds to a portfolio at once.
Acarnas’ portfolio builder let you add as few or as many funds as needed, and in a way that doesn’t interfere with the other investors in your Acron group.
For a very simple portfolio, there are no options for portfolio size.
For an intermediate portfolio, you could choose between smaller and larger funds, or create a smaller-but-still-large fund.
If it’s a complex portfolio, like an equities fund, you may want to create a mix of funds from all funds within a group.
You get to choose how to allocate your investments in Acorns and the portfolio builder.
You pick the allocation of the fund that you want from the dropdown menu, and a panel shows you the fund