For those who want to see sensible returns over the medium to long term, InvestEngine offers a lovely user experience and the ability to trade ETFs at a shockingly low price.
Investing is never free – but InvestEngine is getting pretty darn close. No fees are charged if you’re doing DIY investing and their managed service charges a very low 0.25%. You can only invest in ETFs (i.e. baskets of stocks or assets) so it’s not for the wannabe day trader looking for detailed tools and analysis and a quick return. For the rest of us who want to see sensible returns over the medium to long term it offers a lovely user experience and the ability to trade ETFs at a shockingly low price.
💸 Fee-free investing on DIY account & only 0.25% fee on managed portfolios.
#️ 580+ ETFs to choose from including most major providers.
📱 Lovely platform that offers detailed insight into what makes up each ETF and its performance.
🧩 Fractional investing is available.
🖱️ One-click account rebalancing and auto-invest.
🧺 You can only pick ETFs, not individual stocks.
💷 Will need to deposit £100 to start using the platform.
❌ Doesn’t have Vanguard LifeStrategy funds.
👴 No personal pensions yet – but they are coming soon.
👶 No Junior or Lifetime ISAs.
🌍 Managed portfolio account does not offer an ethical fund option.
🐢 Some users complain about the slowness of orders being executed.
InvestEngine was established in 2019 by Andrey Dobrynin and Simon Crookall (who previously founded Gumtree). InvestEngine initially offered managed portfolios for individual investors but the platform then expanded its services to include DIY investing options and business accounts.
Focused on Exchange Traded Funds (ETFs), InvestEngine aims to provide cost-effective, accessible investment solutions. The founders’ vision was to democratize investing by leveraging technology, offering both novice and experienced investors tools for building diversified investment portfolios. As Crookall has said, other companies “push the trending stocks. What’s hot with other investors, while that really shouldn’t matter for the long-term investor.”
It has raised over £3.7 million in crowdfunding and recently revealed it has over 23,000 customers and £150 million in assets under management.
[.custom-color]An ETF, or Exchange Traded Fund, is like a basket of investments.[.custom-color]
It can include all sorts of things like stocks, bonds, or gold. Usually, they have a theme like “emerging markets” or “green technology companies”.
You can buy and sell shares of an ETF just like you would with a regular stock on the stock market. When you buy shares of an ETF, you’re buying a little piece of everything in that basket. This means you don’t have to pick individual stocks or assets; the ETF does it for you. They’re popular because they’re easy to trade, usually have low fees, and let you invest in a bunch of things at once, spreading out your risk.
[.custom-color]InvestEngine offers three types of accounts.[.custom-color]
General Accounts: Tailored for individual investors, these accounts allow users to invest in a range of exchange-traded funds (ETFs) to meet their personal financial goals.
ISA Accounts: These are Individual Savings Accounts that offer tax benefits to UK investors. InvestEngine’s ISA accounts enable users to invest in ETFs while potentially reducing their tax liability. You can invest up to £20,000 in this account and all the gains you make from it will be tax-free.
Business Accounts: Designed for companies, these accounts provide a platform for businesses to invest their surplus cash. Business accounts offer a corporate investment solution, helping companies grow their funds through ETF investments.
SIPP: A SIPP, or self-invested personal pension, is a type of personal pension available in the UK that offers individuals a greater degree of freedom and control over their retirement savings. With a SIPP, individuals can choose and manage their own investments from a wide range of options, including stocks, bonds, mutual funds, and exchange-traded funds. This flexibility allows for a more tailored approach to retirement planning, but it also requires a good understanding of financial markets or the ability to seek professional advice. Contributions to SIPPs qualify for tax relief, providing a boost to the individual’s retirement savings. SIPPs are generally more suitable for those who are comfortable managing their own pension and are prepared to take on the associated investment risks. InvestEngine has been offering these accounts since January 2024.
In our tests, we were able to open an account in just over 10 minutes. You will need to be resident in the UK and over 18. We were asked to provide a selfie of a passport and a copy of a bank account from the last 3 months. However, not everyone has to provide both of these.
Once you’ve opened your account with InvestEngine, you can choose between two main investment options:
DIY Investing: This option is for those who prefer a hands-on approach. You can build and manage your own investment portfolio by selecting from a range of ETFs offered by InvestEngine. This allows you to tailor your investments to your specific interests, risk tolerance, and financial goals.
Managed Portfolios: If you prefer a hands-off approach or are new to investing, you can opt for a managed portfolio. In this option, InvestEngine’s experts will create and manage a diversified ETF portfolio for you. They’ll select investments that match your risk profile and investment objectives, and they’ll continue to manage and rebalance the portfolio as needed to stay aligned with your goals. To set this up you will be asked a series of questions to understand your risk level. These include:
Once done you will be presented with a suggested portfolio. However, you can manually adjust your level of risk and see a projection of returns. At each stage you can view what selection of ETFs has been put together to create your portfolio.
[.custom-color]Over 580 ETFs.[.custom-color]
If you go down the DIY investing route, there are currently over 580 funds listed on the platform. There’s a range of different providers but they have most of the big names on there like BlackRock, iShares, Invesco and HSBC. They also list Vanguard but do not have access to the popular LifeStrategy funds.
There is an “ETF Range” tab that makes it easy to search for funds by theme (e.g. money market funds, emerging markets, cloud computing) as well as industry (e.g. property, finance, healthcare). In fact, search is a real plus point as InvestEngine makes really good use of labels to help you find the sort of investment packages you’re looking for:
Features
[.custom-color]It’s not a full-on trading platform, but what it does it does very well.[.custom-color]
The Awesome Platform
In our tests, we loved the design and user experience of the app which gives you highly detailed information about the funds available but in a way that doesn’t feel too overwhelming. When viewing any fund you get a breakdown of its performance over time plus its holdings and the sectors and regions it represents. This might sound like a simple thing but on other platforms this can be really tricky (and often impossible) to get your hands on.
Similarly, you get a great breakdown of your own investments when you click on the “analytics” tab.
If you’re planning on being the next Michael Burry this won’t be enough info for you – but for the average investor interested in ETFs, it gives just the right level of info cleanly and simply. Bravo!
Fractional Investing
Fractional investing allows you to purchase a portion of a share, rather than requiring the purchase of a whole share. This means even with a small amount of money, you can invest in high-priced ETFs, making it easier to diversify your portfolio. For example, the Invesco Nasdaq 100 fund has in recent times risen to over £300 a share which might preclude some smaller investors from buying it. Through InvestEngine you could buy a proportion of a share to bring the cost down.
Smart Portfolios
When setting up a portfolio you can set the “weights”, i.e. the percentage you want to invest in each ETF. If you decide to make regular payments to this portfolio you can decide to auto-invest these based on the weights you have chosen.
Of course, over time you can adjust each portfolio if you wish. However, if your portfolio gets out of line with your desired weighting you can use the “one-click rebalancing” tool to bring it back in line. In reality, it takes a few clicks but it’s still a neat feature.
[.custom-color]Incredibly cheap.[.custom-color]
This is what attracts most people to InvestEngine initially and we have to say, we’re not quite sure how costs are being kept so low.
You will pay a different amount depending on the type of account you have chosen:
DIY Accounts
InvestEngine seems to make no money at all from DIY portfolios (excluding SIPPs) as you pay no set-up, account, trading, ISA or FX fees.
This is how it compares to competitors:
We worked out the example cost based on your investing £5,000 and making one trade a month for a year. In our example, your account does not make a profit or loss.
This shows the gulf in price that has opened up between the more traditional brokers and the newer digital investment companies. However, even Freetrade and Lightyear have a way to make money – namely when you trade individual stocks. The only way InvestEngine currently generates revenue is through its managed service (see below).
Amazingly, Vanguard funds are cheaper to buy through InvestEngine rather than through Vanguard’s own platform (though do note not all Vanguard funds are available).
You should also note that the ETF funds themselves have their own costs. These can be as low as 0.07% but we have seen them go, in rare cases, as high as 0.89%. There is also an “ETF spread cost” – the difference between the buying price (ask) and the selling price (bid) of an ETF, representing the transaction cost paid by the investor when trading. On average this is 0.07%. These fees are incurred whatever platform you trade ETFs through and none of this money goes to InvestEngine.
Managed Portfolio Costs
This is the same cost as the DIY account except for a 0.25% annual charge. For comparison, Nutmeg charges 0.75% on the first £100,000 of each account it manages.
All this makes InvestEngine an incredibly cheap option for investing. Our only niggle with this is that it feels too good to last and we do wonder if at some stage the DIY portfolios will start to attract more fees.
SIPPs
To quote from InvestEngine: “You’ll pay 0.15% for your InvestEngine SIPP, capped at £200 per year. You can then build your own portfolio commission-free, or leave it to InvestEngine’s experts to manage a SIPP portfolio on your behalf for 0.25%”. Again, it’s remarkably inexpensive compared to the competition.
[.custom-color]Email or contact form only, but responsive.[.custom-color]
As is becoming standard with digital startups there is no way to speak to a human at InvestEngine. To get a query resolved you will have to email or fill in the contact form on the web or app.
However, when we tested this, customer support was super quick to reply, answering our query in less than two minutes.
There is also a detailed, searchable help database as well as a fairly active community forum where troubleshooting queries are regularly posted and resolved.
[.custom-color]Yes, but we’d like to see more education resources.[.custom-color]
Yes, InvestEngine is geared towards being beginner-friendly, especially with its Managed Portfolio services where investment decisions are made for you based on your risk appetite and financial goals. The fact it is entirely focused on ETFs also means you won’t have to get into the detail of trying to pick stocks but instead can focus on industries or thematic trends that you think will win over the long term.
In terms of education, you will probably want to look elsewhere. While they do have a blog with well-written articles, we didn’t find it to be structured enough to give a beginner a proper education in how to trade. The main topics discussed in the community seem to be help using the platform and feature requests.
[.custom-color]It’s highly regulated.[.custom-color]
InvestEngine is FCA-regulated and therefore has to adhere to a strict set of codes. The FCA mandates, for example, that InvestEngine maintains client funds and assets separately from its own corporate accounts, a process known as ‘ring-fencing’. This separation is critical as it protects investors’ shares and funds from being used for any other purpose, such as company operations or recovery in the unlikely event of the firm’s insolvency.
Alongside this, InvestEngine’s inclusion in the Financial Services Compensation Scheme (FSCS) provides further assurance, offering compensation coverage for any cash and value of assets held in your account up to £85,000 in the event of InvestEngine’s insolvency.
Yes, it’s fantastic. For anyone looking to just invest in ETFs there isn’t a cheaper option we know of.
Note: When investing, your capital is at risk.