Motif Investing advantages and disadvantages. What are the good and bad things about Motif Investing?


Rating:  Motif Investing rating

Motif Investing is a unique broker in an online investment industry. Headquartered in Silicon Valley, the firm offers distinctive investment products aptly named motifs. Some of the firm's famous investors include Foundation Capital, Norwest Venture Partners, Goldman Sachs, and Ignition Partners. It is definitely a company that everybody needs to check out. Read on to learn more about Motif Investing pros and cons.

Motif Investing Commissions

  • Motif (up to 30 Stocks/ETFs) $9.95 per trade
  • Stocks & ETFs within Motif: $4.95 per stock/ETF
  • Stocks & ETFs outside Motif: $4.95 per stock/ETF

Motif Investing Pros

Low Trading Commissions. Motif Investing offers a very low trading commission. The $9.95 commission for purchasing or selling up to 30 stocks or a motif is what one would call a mind-blowing price. The cost of trading a particular stock through Etrade is $6.95. It means it will cost investors around $210 in commissions only to buy any 30 stocks and another $210 to sell the same 30 stocks whether those investments would be profitable or not. Let us also consider Firstrade, the lowest-cost discount broker. The firms charges $0 per trade. Buying 30 stocks through Firstrade will cost $0. The cost of a trade trade of 30 stocks with Motif Investing is only $10, which is also quite impressive!

Commission-free Motifs. The company goes even further by offering commission-free "Horizon Motifs," which are "carefully chosen passive, low-cost, index-based ETFs to represent each asset class (such as US bonds, US equities, commodities, international equities, etc.)." A broker's ability to provide an additional way to dramatically reduce the cost of investing is a great advantage.

Complete Flexibility. As a Motif Investing customer you get complete flexibility with your investments. There is no obligation to 'marry' stocks within a motif. Poorly performed stocks can be sold for a low $4.95 commission per stock, which is still almost twice lower than selling a stock for $9.99!

Professionally built motifs revolve around a concept or an idea and offer a simple and fast way to start investing even for those who are just starting out with investing. All motifs, including those that are pre-built, are fully customizable and can be readjusted absolutely free before purchasing. Don't like pre-built motifs?! Then, you can build your own motif to diversify the portfolio with your investing objectives in mind.

Beginners-friendly. Those investors who prefer to perceive information in a visual format and, of course, investors who are just starting out will enjoy the platform the most. Plenty of pictures and charts makes the processes of picking a concept/theme to customizing and purchasing a motif very pleasant and so simple.

Perfectly Safe. Motif Investing is a perfectly safe brokerage firm. It is a member of FINRA and SIPC. To supplement SIPC protection, Motif has purchased an additional insurance policy through a group of London Underwriters that will be available to customers in the event that the SIPC limits are exhausted.

Motif Investing IRA Advantages

No-fee IRA Accounts. A variety of no-fee IRA accounts (Traditional IRAs, ROTH IRAs, Rollover IRAs and 401(k), SEP IRAs) is another great pro of Motif Investing. There are only a few IRA providers out there who offer fees-free accounts, and Motif Investing is one of them. If you are the buy-and-hold type of investor, just imagine how many ways Motif Investing can lower your investing cost - no set-up or annual IRA fees, a very low investing cost and commission-free motifs! You can even consider a motif as a fund, an instrument so popular for retirement savings. What's more, it is a fund without management fees, which can deplete your savings dramatically.

An Automated Investing Service. An optional automated investing service is designed to help you stay disciplined and be consistent with your investments while building wealth. It is a three-tiered monthly rate subscription service that offers some other advantages such as free trades, exclusive market reports and real-time quotes in addition to auto-investing and auto-rebalancing benefits. The service fee is $4.95 - $19.95 per month, and the first month is free. There is no obligation and no commitment. You can unsubscribe any time by contacting a representative.

Motif Investing Cons

Poor Investment Options. Although Motif Investing offers an excellent opportunity for diversification, the company is lacking in investment options: only stocks and ETFs are available through the brokerage. Mutual funds, bonds and other investments are not offered.

Lack Of After-hours Trading. This might be unnoticeable for the majority of investors; however, it is important to active traders.

Motif Investing Pros and Cons Summary

There is no minimum funding level, so almost anyone can open an account and explore everything what Motif Investing has to offer at no cost. The platform is very easy to understand and user friendly even for beginners. You won't be charged a set-up or inactivity fee. All fees are clear and straightforward and can be reviewed at the official Motif website.

Motif Investing is definitely not for everyone. Investors who want to go with the safest and most widely used route to wealth building - mutual funds - should take a look at Best Brokers For Mutual Funds article.

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