SoFi Active Investing Review
Sofi or Social Finance, Inc. first launched in August 2011, and ever since, it’s been focused on helping young investors start trading effectively. Sofi also has cryptocurrency trading available, allowing people to buy a wide range of cryptocurrencies, including Bitcoin. It is a good trading system for new investors, mostly thanks to the benefits it can bring to the table.
While this looks promising from the get-go, it is always great to do some research before you start trading. So, before you settle for SoFi for your trades, you need to make sure that it is a safe and great platform for what you intend to do. This guide will give you all the information you need.
Who Is Sofi Active Investing for?
SoFi Active Investing is a wonderful choice for people who are new to trading, particularly young individuals who want to pursue trading in the future. It is a great platform for people who want a safe place to perform their trades while being able to practice and become better in terms of trading.
Sofi Active Investing is best for:
- People who want to start trading for the first time
- Young people who want to learn more about trading
- Investors looking for something that requires no minimum to start an account
- People who want to trade cryptocurrencies
- Individuals who don’t want to spend too much money when investing in trades
SoFi is amazing for anyone who is a beginner with investing and just wants to get started with it very easily. Since there is no minimum amount required to open an account, you can make a smooth transition to trading. You will not have to invest too much as a result. Also, if you have another SoFi account already, this can be a great option because moving money between SoFi Money and SoFi Invest accounts is a straightforward process.
But if you are an advanced investor, SoFi may not be the best option for you. You may need something like tax-loss harvesting or stop-loss orders, in which case SoFi cannot offer them to you.
Things We Like
SoFi is an all-in-one app that works as a base for the investing platform, but also for every financial product it offers. We liked the fact that the platform doesn’t require any account minimum to be able to start buying and selling stocks.
Besides, the trades are free of commissions, so you can start trading without worrying about any fees. SoFi was also one of the first brokerages that offered its users fractional shares. We love this because it lets people purchase one piece of a share, so they don’t have to instantly pay the entire price. It gives people with lower income more opportunities in terms of buying shares. Not to mention that this is also a great way to diversify one’s portfolio. Lastly, we also love the fact that SoFi gives free financial counseling to all its clients.
Things We Don’t Like
Whereas we like the fact that SoFi has been around since 2011, which makes it more experienced, SoFi Active Investing is basically a newer platform. It has only been launched in 2019. Therefore, people may be looking for something with more experience in the field.
We also don’t like the fact that there is a limited amount of investment options. Whereas cryptocurrency and fractional share offerings are a thing, the platform lacks other investment options, like index funds, mutual funds, and bonds. Things like Forex, futures, and options are not available either.
Pros / Cons
- $0 stock and ETF commissions
- Low account minimum
- High-quality mobile app
- Great customer support
- No mutual funds
- No stock option trading
- Available only for US clients
Safety and Regulation
SoFi Active Investing is a delightful platform for anyone who wants to start investing but has a lower income. It’s also great for individuals who are just starting in this field. Before using it, though, you should know as much about it as possible.
Who Is Sofi Active Investing?
Sofi Active Investing is a platform offered by Social Finance, Inc and was established by Stanford business school students. SoFi is short for “Social Finance”, and it is a fintech startup that was established back in 2011.
Initially, it was known for student loan refinancing. Later on, in 2018, it became a broker. The platform now has active and automated investing services to offer to its members. The brokerage is a self-directed one and it is part of the financial product expanding line of the company in San Francisco. SoFi doesn’t have a banking license, though.
What makes SoFi different from other platforms like Wealthfront and Robinhood is the fact that it offers access to financial advisers for free. You can start investing with very little money if you want to. The platform has commission-free stock trades, as well as ETFs and fractional shares. Cryptocurrency trading is available too.
Is Sofi Active Investing Regulated?
You can rest assured in this area because Sofi is a regulated platform. The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) are the ones regulating SoFi.
Is Sofi Active Investing Safe?
Protection is important while you’re investing. Therefore, it is important to know how safe SoFi is before using it. You should know that the platform is pretty safe, as it has 256-bit SSL encryption. Not to mention that it is also regulated by FINRA and SEC.
But just like with any other brokerage, you have to be aware that there are still some risks. SoFi investing can usually be as safe as investing in other platforms would be. But there is always the risk of loss when purchasing stocks or other types of market security. Luckily, SoFi Invest has SIPC insurance. In case the broker fails, this protects people who create an account on the platform.
Countries It Accepts Clients from
SoFi is a U.S.-based service, and it offers active investing for everyone in the United States. All 50 states have this service available.
SoFi has won a Gold Stevie Award back in 2015 thanks to everything it has accomplished until then.
Range of Offerings and Products
SoFi Invest has several offerings ready for its members. Cryptocurrencies, ETF’s and some others can make trading possible for new investors if they decide to start their trading activities with SoFi.
SoFi Active Investing is pretty limited in comparison to what other platforms have to offer, so it may not be the best option for more advanced traders. But for beginners, it is more than suitable. There are a few things that SoFi has to offer, such as:
That being said, the platform doesn’t allow options, mutual funds, or bonds.
SoFi Active Investing is available on a web platform and a mobile one. The platform has a safe, two-step login and is pretty user-friendly. The design is nice, and it makes navigation much easier. Unfortunately, there are not enough customization options, no price alerts, or multiple order types.
As for the mobile platform, it has a great design as well, and it is user-friendly. It can be used on both Android and iOS devices, and the login is very safe as it is also done in two steps. Just like in the case of the web platform, the order types are limited and there are no unique price alerts.
SoFi is a bit different from other brokerages. It offers different types of accounts, more specifically traditional, SEP-IRA, and Roth IRA accounts to investors. This is also available when it comes to active investing.
SoFi Invest allows you to keep your cash in USD only, and if your account has another currency, a conversion fee will apply. SoFi deposits can only be done through bank transfers, and some of the banks available include Chase, Wells Fargo, Bank of America, U.S. Bank, CitiBank, and Charles Schwab.
SoFi has no minimum deposit required for its trading platform. So, this is great when you only want to invest small amounts.
Withdrawals are only available through bank transfer, so e-wallet and credit/debit card withdrawals are not possible. Also, there are no fees charged for withdrawals.
While SoFi has multiple account options, it has no demo account.
Sofi Active Investing Promotions
SoFi has different promotions that you may want to check out. The promotions may change over time, with new ones being added. Some promotions include:
- $100 for new and existing SoFi members who make a deposit of $1,000 or more in total Direct Deposit transactions that qualify
- Cash prizes for spending on their SoFi Money card
- $10 deposit in the SoFi Money account when checking the Student Loan Refinance loan rate
Client Support and Education
SoFi offers several resources that help educate clients and prepare them for trading. Content is posted regularly on a YouTube channel and the platform’s blog. Unfortunately, no demo accounts are available, and there are no webinars and platform tutorials.
Verdict – Overall Rating
Overall, SoFi Active Investing is a great platform and has a lot to offer for beginners. Anyone new to trading will find SoFi useful. The app is neat and runs smoothly as well. At the same time, it is not the best option for experienced traders because it has multiple limitations. The platform could also improve educational resources.
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There is a very high degree of risk involved in trading securities.
With respect to margin-based foreign exchange trading, off-exchange derivatives, and cryptocurrencies, there is considerable exposure to risk, including but not limited to, leverage, creditworthiness, limited regulatory protection, and market volatility that may substantially affect the price or liquidity of a currency or related instrument. It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable, or that they will not result in losses. Learn more at Wikipedia.
All investments involve risks and are not suitable for every investor. The value of securities may fluctuate and as a result, clients may lose more than their original investment. The past performance of a security or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk it does not assure a profit, or protect against the loss, in a down market.
There is always the potential of losing money when you invest in securities or other financial products. Investors should consider their investment objectives and risks carefully before investing. More details here.
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