Why Smart Beta?

Smart Beta

Over the past decade, smart beta products have been growing in popularity, and for good reason. Smart beta products provide exposure to equity markets by investing in diversified baskets of securities that assign higher weights to stocks that have desirable characteristics.

Benefits of our Smart Beta Portfolios

IB Asset Management Smart Beta Portfolios have low fees and provide broad market exposure and potentially higher returns than Mutual Funds and Exchange Traded Funds.

Low
fees

Low fees

Industry low
0.08%
management fee

Transparent
 

Transparancy

See positions and
trades online at
any time

Fractional
shares

Fractional shares

Diversification at
low investment
minimums

Ease of
buying

Ease of buying

Buy and sell easily
online and
by phone

Rebalanced
for you

Auto rebalance

Auto rebalancing
your account
every quarter

Invest today

IB Asset Management offers a wide variety of portfolios, so you can find one that matches your investing goals. The Smart Beta Portfolios come in large / mid cap and small cap versions. All the Smart Beta Portfolios use a rules based investment approach and assign higher weights to stocks that have desirable characteristics.

As a form of risk control, the portfolio construction process is designed to penalize high volatility in stocks and avoid excessive concentration in single sectors of the market.

A broadly diversified portfolio made up of 1000 large and mid sized US companies. Allocations are a blend of equal and capitalization weight. The equal weight component results in a larger proportion of smaller companies compared to a pure market cap weighted portfolio, making it less prone to having a high concentration in bubble stocks that have experienced dramatic price appreciation.

Past 30 days

1.1%

Past 90 days

7.5%

Past 365 days

17.6%

Sharpe ratio

-

Risk score:

Minimum investment: $5,000

Annual fee: 0.08%

A diversified portfolio made up of 300 large and mid sized US companies.  Stocks with attractive dividend yields receive higher allocations. One advantage of the portfolio is that it offers investors a stream of dividend income while also providing the potential for longer term attractive returns.

Past 30 days

0.4%

Past 90 days

6.8%

Past 365 days

15.5%

Sharpe ratio

-

Risk score:

Minimum investment: $5,000

Annual fee: 0.08%

A diversified portfolio made up of 300 large and mid sized US companies with attractive earnings growth. Both trailing and forward earnings growth measures are considered when determining allocations. Even if a company reports better than expected results, analyst forward estimates are also important in determining attractiveness of the stock.

Past 30 days

0.7%

Past 90 days

6.6%

Past 365 days

20.1%

Sharpe ratio

-

Risk score:

Minimum investment: $5,000

Annual fee: 0.08%

A diversified portfolio made up of 300 large and mid sized US companies with attractive quality ratios that are typically indicative of strong management teams. Return on assets and other earnings quality measures are considered when determining allocations. The portfolio seeks securities with strong fundamentals that are not excessively overvalued.

Past 30 days

1.0%

Past 90 days

7.5%

Past 365 days

18.2%

Sharpe ratio

-

Risk score:

Minimum investment: $5,000

Annual fee: 0.08%

A diversified portfolio made up of 300 large and mid sized US companies with attractive valuation ratios. Both trailing and forward price-earnings valuation ratios are considered when determining allocations. This contrarian approach to stock selection allows us to allocate capital to companies that may be out of favor with the market, but poised for recovery.

Past 30 days

0.7%

Past 90 days

7.4%

Past 365 days

15.5%

Sharpe ratio

-

Risk score:

Minimum investment: $5,000

Annual fee: 0.08%

A diversified portfolio made up of large US companies. The initial allocation is based on capitalization weight. It is rebalanced with the objective of harvesting unrealized investment losses while trying to maintain the target capitalization weighting. Harvested tax losses could potentially be used by investors to offset other gains and income depending on their unique circumstances.

Past 30 days

0.9%

Past 90 days

6.7%

Past 365 days

-

Sharpe ratio

-

Risk score:

Minimum investment: $5,000

Annual fee: 0.08%

About Interactive Brokers Asset Management

Covestor dashboard

IB Asset Management is part of the Interactive Brokers Group - a global electronic broker that operates in over 120 markets worldwide with more than $100 billion in client equity.

Our Smart Beta Portfolios are managed by a team of professionals with significant experience in back-testing and managing quantitatively oriented ‘active’ equity strategies designed to compete with actively-traded funds. The team is lead by our Chief Investment Officer Sanjoy Ghosh, PhD, who previously served as Director of Investments for PanAgora Asset Management and worked for Putnam Investments.

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Performance information disclosures

  1. All performance information on this page:
    • Is provided for informational purposes only and should not be used as a basis for making an investment decision;
    • Is based on the performance of portfolio-specific accounts owned by IB Asset Management; and
    • Is not based on the actual performance of any client account investing in any of these portfolios, which could differ from the performance displayed here and is available on each client’s dashboard.
  2. The performance information displayed here is calculated on a daily time-weighted basis, including cash, dividends and earnings distributions, is presented “net of fees,” and reflects the deduction of IB Asset Management advisory fees, Interactive Brokers LLC brokerage and other commissions and expenses that a client will have to pay if he invests in any of these portfolios.
  3. The performance of a client account investing in any of these portfolios could differ from the performance displayed on this page based on any trading restrictions imposed by the client (resulting in different account holdings), time of initial investment, amount of investment, frequency and size of cash flows in and out of the client account, applicable brokerage commissions, and different corporate actions. Clients investing in any of the Smart Beta portfolios can view the actual performance of their investments by logging into their IB Asset Management account and reviewing their customized dashboard.
  4. Past performance is no guarantee of future results, and all investments, including those in any of these portfolios, involve the risk of loss, including loss of principal and a reduction in earnings.
  5. Benchmark and index comparisons are provided for informational purposes only and should not be used as the basis for making investment decisions. No index is directly comparable to the performance displayed shown since each index has its own unique results, risk profile, liquidity, asset composition, and volatility. Benchmark returns displayed do not include dividend income, while returns for the IB Asset Management account managing each portfolio and displayed on these performance graphs include dividend income. This difference could result in benchmark returns being understated.

Other disclosures

  1. Covestor Ltd is an investment adviser registered with the Securities and Exchange Commission, doing business as Interactive Brokers Asset Management (“IB Asset Management”).
  2. IB Asset Management’s Smart Beta Portfolios are made up of individual stocks. They are not ETFs or Mutual Funds. Clients that invest in these portfolios own the stocks directly.
  3. These portfolios mainly invest in stocks and may not be suitable for all investors. Clients may lose all or part of their investments in these portfolios, and their past performance is no guarantee of future results.
  4. IB Asset Management manages these portfolios by trading its own funds and replicating this trading in the accounts of investing clients. Clients may restrict the stocks traded in their account. Any restrictions may affect the performance of a client account leading it to perform differently, worse or better, than IB Asset Management’s account managing the portfolio.
  5. In addition to IB Asset Management’s management fees, clients will be charged commissions for the trades in these portfolios by Interactive Brokers LLC, IB Asset Management’s affiliated broker-dealer, which is a conflict of interest.
  6. Clients may find additional information on the risks, conflicts of interest, applicable brokerage commissions, fractional shares, and limitations on investments and divestments associated with these portfolios (along with IB Asset Management’s full disclosures) on the Forms and Agreements page.