Test Accounts Week 9

The S&P 500 index was down for the third straight week, -0.9%. Betterment and Wealthfront also had down weeks, -0.1% and -0.3% respectively. For the nine weeks, the S&P 500 index is still up, but only 0.4%. Betterment is up 0.6% and Wealthfront is up 0.5%

I received an Email from Folio Investing saying I had a cash deficit and suggesting that I add cash to the account. This was surprising since I couldn’t think of any action that I took that would have precipitated the deficit. So I went to the account and saw the culprit. It was the $290 annual trading fee charged to my account. I did indeed select paying this annual fee rather than individual or monthly trade fees. Based on the number of small trades that occur in this account, I do believe the annual fee is the best option.

I had also elected to have this fee taken from my account. This is just a cost of doing business with Folio Investing, just as are the service fees from Betterment and Wealthfront. Those costs will come out of the accounts also. To cover the deficit, I sold $300 from the Dogs of the Dow RTG. This resulted in 10 small trades. I selected the option to attempt to re-balance the RTG with these sales only. I could have opted to use buys and sells to re-balance the account while still extracting the $300. That would have been a better choice. The result of the fee and trades was a -3.4% net for the week, and dropped the nine week performance to -1.2%.

The balance of the Lending Club account was up 0.2% for the week and is up 1.3% for the nine weeks. This is in spite of the 1% fee taken out of the payments. Not bad considering we’ve only been receiving payments for three weeks.  There is an additional cost of doing business in dealing with Lending Club, and that is bad loans. We haven’t encountered any yet, but will.

Finally, as I indicated in a post a few days ago, Charles Schwab has introduced Schwab Intelligent Portfolios. I will be opening a comparable test account with Schwab. I’ll post my experiences at mid-week. Follow me on Twitter @billlanke and I’ll let you know when I make this post.

W/E	S&P 500	BTRMNT	WLTFRNT	FOLIO	LND CLB
16-Jan	-1.2%	0.0%	0.4%	-0.2%	0.0%
23-Jan	1.6%	1.1%	0.7%	2.0%	0.0%
30-Jan	-2.8%	-1.5%	-0.9%	-2.0%	0.0%
6-Feb	3.0%	1.0%	1.0%	0.9%	0.0%
14-Feb	2.0%	1.0%	0.8%	1.8%	0.0%
21-Feb	0.6%	0.6%	0.4%	0.5%	0.0%
28-Feb	-0.3%	0.2%	0.2%	0.3%	0.7%
6-Mar	-1.6%	-1.6%	-1.8%	-0.9%	0.3%
13-Mar	-0.9%	-0.1%	-0.3%	-3.4%	0.2%