We typically trade on a daily basis, yet we reserve the right to trade less frequently if, in our discretion, we regard it as necessary or desirable to do so.
We aim to keep cash as low as mathematically possible. If there is any residual cash left over after any trading (this is due to market movements where the values from buys and sells can generate a small float) we will aim to invest that cash if possible within our next trading window.
Dividends will be allocated to the portfolio and re-invested.
There are a number of controls in place to ensure that we do buy and sell what we tell you we have. The biggest one being the Financial Services and Markets Authority (“FSMA”) supervision. They require an independent auditor to review all of our arrangements on a regular basis, and to submit the findings of this audit to the FSMA. There is also a European directive that requires us to report all our trades to the FSMA. This includes reporting how much we traded on the exchanges, and on whose behalf we traded. The other side of our trade, i.e. the person or entity we buy from or sell to, also has to report their trades. However, for obvious privacy reasons, no information about client transactions is available to anyone except for the regulator or other relevant authority, the auditor, and us.
With rebalancing we refer to the process of reviewing whether the actual weightings in a portfolio falls outside of predefined tolerance weightings for each target of each asset and, if that is the case, selling off over weighted assets in order to buy under weighted assets. This may incur (indirect) transactional costs as well as trigger capital gains tax and ETFmatic aims to keep both of these as low as possible. There are also practical considerations which make rebalancing easier or more difficult depending on the size of the total holdings.
If a goal qualifies for rebalancing does not automatically mean that any particular buy or sell orders will be placed, it simply means that it is flagged to be included in the rebalancing. It is then up to the rebalancer to determine what, if any, orders will be generated for the goal.
- Goal value > threshold*
If the value of the goal exceeds a threshold set by ETFmatic, it will always be tagged for rebalancing. Currently the threshold is 25.000 EUR.
- Time since last rebalance > threshold*
Since many of the current goals and portfolios fall below the goal value threshold, ETFmatic has also defined a policy of reviewing each goal at least once every six months. This check will flag any goal for rebalancing if more than six months have passed since it was last included in the rebalancing.
- New fundings
If a client deposits new funds to its investment portfolio, the funds will get invested in a way to keep the portfolio as close as possible to the target asset allocation.
If a client requests a partial liquidation of a goal in order to withdraw funds, this is done in such a way as to rebalance the portfolio.
Exchange Traded Funds (ETFs) are investment funds that normally closely track the performance of a financial index. They are traded like shares and hold assets such as shares, commodities or bonds. ETFs typically have higher daily liquidity and lower fees than mutual fund shares, making them an attractive alternative for individual investors. Find out more about approach here.
ETFs typically have higher daily liquidity and lower fees than mutual fund shares, making them an attractive alternative for individual investors. As ETFs provide a native diversification and have certainly proved their worth over the years they are a tailored instrument to pursue a long-term investment strategy.
Robo-advisors are online investment services that automate investment advice in order to make wealth management accessible to potentially everyone at any time.
ETFs typically represent investments in underlying stocks or bonds. As with all investments, this puts capital at risk. However, the ETFs ETFmatic uses represent investments in broader indices of stocks and bonds. As such they are more likely to provide a more stable and safe return than investing in single stocks or bonds.
The performance of ETFs available in the market is constantly reviewed and each of them is scored according to our selection criteria which considers many aspects of the instruments such as their tracking error,liquidity, volume, provider, inception date, etc. We then combine them in unique portfolios based on the needs of each of our customers.
Given we adjust the target weight of each asset constantly the aggregated total expense ratio varies by portfolio and in time. Currently 95 % of our portfolios range between 0.11 % and 0.15 %. You can find more details in the App.
Account Opening and Administration
We’re authorized and regulated by the Financial Services and Markets Authority in Belgium. Here you can also find under the section “Passport Out” the full list of countries where we are enabled to provide our services within the European Economic Area.
Due to tax reporting issues we unfortunately do not accept applications from or accounts held by US citizens and US tax payers.
Payment & Transfers
Of course you can. If you ask for your portfolio to be liquidated and your money to be returned to you, we will sell off your positions as part of the next trading and transfer the proceeds back to you.
Generally it takes 2–3 business days until funds are paid into your account. They are then invested in your portfolio in the next trading cycle.
Custodian & Score Keeping
You can add or remove from your initial investment whenever you want to. But please keep in mind, investing in stocks and bonds puts capital at risk so your portfolio can go down in value. Your portfolio is managed keeping your target end date in mind, so selling earlier means that you run a larger risk of incurring losses on your holdings.
So far unfortunately not.
ETFmatic uses Barclays as the custodian for all client money accounts. All safe custody assets and any client monies in process of being invested are held with SAXO A/S in a segregated account in the name of Aion Bank SA/NV. Both client money and safe custody assets are at all times held according to the Belgium Guarantee Fund rulebook, protected by appropriate acknowledgement letters issued by the relevant custodians, and are covered by the Belgium Guarantee Fund.
Tax & Compliance
We comply with the EU regulation on the reporting and sharing of financial information for tax purposes. At the end of each tax year we will provide each client with a summary of all the taxable events such as dividend distributions, and ETF purchases and sales (”Tax Report”).
We are covered by the Belgium Guarantee Fund with the usual restrictions. All sums held in accounts with Aion are covered by the Belgium Guarantee Fund up to EUR 100.000 (regardless of the currency) per depositor; and Financial instruments are covered by the Belgium Guarantee Fund up to EUR 20.000 (regardless of the currency of the financial instruments).
For further information please refer to the official Belgium Guarantee Fund website.
Find out more about approach here.
Client money as well as ETFs are held in segregated accounts protected by the FSMA rules on Client Money and Safe Custody Assets and are secured by the Belgium Guarantee Fund.
Therefore, in the unlikely case of us going insolvent, your money will be sitting safely at Barclays and at Saxo Bank.
ETFmatic will not be able to, and is not allowed to, access your money for any purpose other than investing it in your best interest. Additionally, we are covered by the Belgium Guarantee Fund with the usual restrictions, including limits for investments which are currently set at EUR 100.000 (regardless of the currency) per depositor; Financial instruments are covered by the Belgium Guarantee Fund up to EUR 20.000 (regardless of the currency of the financial instruments).
For more information please refer to the official website of the Belgium Guarantee Fund.
ETFmatic charges an annual fee of 0.48 % of your assets under management.
This fee includes:
- Design and execution of your investment strategy
- 24/7 reporting and administration
- Brokerage fees
- Custody fees
It doesn’t include:
- All fees charged by the banks for transfers to your ETFmatic account
- Total Expense Ratio already priced by the ETF issuers into the assets we buy for your portfolio (0.1 – 0.15 % for most ETFmatic portfolios)
Our annual management fee is 0.48 % for all portfolios. The underlying total fees of the ETFs we select currently range from 0.1 % to 0.35 %.
The Total All-Inclusive Fee for an ETFmatic portfolio will therefore range between 0.59 % to 0.62 %.
Please note the above are the latest estimates and will vary depending on the asset allocation you have selected (Custom portfolios) and any changes in the underlying ETFs we use.
We charge 0.48 % on an annual basis of your assets under management.
Since your holdings will fluctuate over time as a result of additional contributions and changes in the market, we take daily snapshots of the value of your portfolio.
We use these valuation snapshots to calculate pro-rata fees on a monthly basis. We send you a detailed summary of the fees charged per portfolio.
Fees will automatically be deducted from the cash held in your ETFmatic account at the end of each month – there is no extra payment to be made and we do not access your bank account. Next time your account receives dividends or a transfer the system will try to charge the outstanding fees.