With this article, our goal is to dissect and compare the management of single ETFs and Mintos Core ETF portfolio. At Mintos, our goal is to always offer our investors the full picture, so you can make well-informed decisions regarding your investments.
If you need a refresher, check out our previous articles:
Investing in ETFs for beginners: simplifying the process
For beginners, the investment landscape is often overwhelming, dotted with countless options and complex decisions. With Mintos Core ETF, we offer a streamlined and efficient approach to investing in ETFs.
A new investor’s choice
Imagine a new investor, Emma, exploring her options for ETF investment. She considers two paths:
- Individual management: Emma can select and manage her ETFs. This path offers her full control over her investments, but it also requires her to be constantly informed about market trends and to make all decisions regarding her portfolio composition and rebalancing.
- Mintos Core ETF: Alternatively, Emma can opt for Mintos Core ETF. With this choice, she benefits from a professionally managed portfolio, where all aspects of ETF selection and management are handled by Mintos. This option allows her to invest with less time and effort, which suits her busy lifestyle.
Both paths offer distinct advantages and cater to different investment styles and needs. While the manual approach offers more control, it demands greater time and knowledge.
On the other hand, Mintos Core ETFs provide a simpler, more streamlined investment experience, especially beneficial for beginners or those seeking a passive investment strategy.
This comparison between managing single ETFs and using Mintos’s managed Core ETF portfolio highlights key differences in the investment process. It illustrates how Mintos simplifies various aspects of investing, from time and effort required to risk management, making it more accessible and manageable for those new to the world of ETFs.
Aspect
Single ETF management (self-managed)
Mintos Core ETF portfolio (managed by Mintos)
Investment management approach
Individual management of a single ETF requires investors to stay informed about market trends and the performance of their chosen ETF. Decisions on when to buy, hold, or sell are solely at the investor’s discretion.
Mintos offers a professionally managed portfolio approach.
We handle all aspects of portfolio management, including market analysis, selection of ETFs, and timing of transactions, providing a more hands-off experience for the investor.
Time and effort
Significant time investment in research, monitoring, and rebalancing. Steeper learning curve for financial management.
Simplified investment process, ideal for passive investors. Saves time and reduces effort, allowing focus on other priorities.
Portfolio composition
Requires knowledge of asset allocation principles. Investors must actively decide the proportion of each ETF.
Automated portfolio construction according to predefined investment goals and risk profiles. Removes the need for constant adjustment by the investor.
Portfolio rebalancing
Frequent manual rebalancing may be necessary, especially in volatile markets. Can incur additional transaction costs.
Automatic rebalancing with investment and withdrawal activities. Efficiently maintains the predefined ETF ratios without extra costs.
Understanding costs
Involves navigating through various fee structures (management fees, transaction costs). Risk of incurring higher costs due to multiple transactions.
A transparent fee structure with zero management fees imposed by Mintos.
Entry investment amount
Higher initial investment is typically required to achieve true diversification. May not be feasible for investors with limited capital.
Accessible entry point with a minimum investment of just €50. Makes diversified investing attainable for most budgets, due to the possibility to invest in fractions of the ETFs.
Risk management
Individual risk assessment for each ETF required. Potential for unbalanced risk exposure due to improper selection.
Designed to align with the investor’s risk tolerance and goals.
Concluding Emma’s scenario, her decision between self-managed ETFs and Mintos Core ETF encapsulates the fundamental differences in investment approaches.
While managing single ETFs demands her active involvement, market savvy, and time commitment, the Mintos Core ETF approach offers her a professionally managed, time-efficient solution with a focus on risk management and portfolio diversification, tailored to fit her lifestyle and investment goals.
Mintos Core ETF: maximize potential, minimize costs and time
Investing in ETFs can be a straightforward process for beginners, especially with the availability of user-friendly platforms and a wide range of ETF options. While selecting and purchasing individual ETFs might be relatively simple, beginners often face challenges in understanding the broader aspects of ETF investing, such as asset allocation, risk management, and portfolio rebalancing.
Investing in managed portfolios like Mintos Core ETFs involves an additional step of passing a suitability and appropriateness test. This ensures that the investment aligns with the investor’s profile and risk tolerance, a safeguard that isn’t always present when purchasing individual ETFs, which can be bought even if they may not be ideally suited to the investor’s needs.
With Mintos Core ETF, our goal is to empower investors when it comes to the decision-making process. A key factor for us is cost and accessibility– and the best way to streamline this for investors.
- A personalized investing experience: We recognize that every investor is unique. That’s why our ETF portfolios are personalized, to suit your specific risk tolerance and financial objectives. Your exact portfolio depends on how much risk you’re willing to take, and how long you plan to hold your investments.
- No additional commissions: Mintos does not impose any commissions for management, trading, or other services. This approach is particularly appealing for those looking for a cost-effective investment strategy. The only cost is the ETF’s total expense ratio (TER), which averages less than 0.1% for the ETFs we’ve hand-picked.
- Diversification simplified: Our expertly curated collection of ETFs provides you with diversified exposure to various asset classes, reducing risk and enhancing the potential for returns. We curate globally diversified portfolios, providing broad industry and regional representation in a single investment, thereby reducing investment risk.
A beginner tackling individual ETF management faces increased risk, due to limited market knowledge and experience. The potential for misjudging market trends or failing to diversify adequately can lead to higher volatility in returns.
While you’d be able to take care of all the separate trades for each ETF and periodic rebalancing yourself with individual ETFs, the portfolio will drift away from your target proportions over time.
Making all these trades could cost you more, and it will certainly take more of your time. Moreover, you might not be able to buy fractions of the ETFs, so achieving the same target weights might be difficult. With every investment or sale, we dynamically rebalance your portfolio to steer it back towards its target weights:
- When you invest, we prioritize adding funds to the underweight ETFs.
- When you sell, we draw more from the overweight ETFs first.
This way, you can invest regularly and maintain target weights with no hassle.
Find out more about how we select ETFs.
Have a question before you kick-start your ETF investment journey with us? We’re here to help!
Or, if you’re ready to get started, diversify your portfolio here– start investing with as little as €50.
