The Palo Alto, California company’s Automated Bond Portfolio features a 5.48% yield net of fees, using a diversified mix of Treasury and corporate bond ETFs that would typically carry less risk than stock portfolios.
1 In a rising rate environment, a product like this could provide more liquidity compared to other popular fixed-income instruments such as CDs and Treasurys.
2 The Automated Bond Portfolio is 100% managed and adjusted to rebalance, reinvest dividends, and even add cost savings with tax-loss harvesting.
1 A 0.25% annual management fee is applied, just like its Automated Index Investing account, which puts client money into a balanced mix of sectors, based on a risk score, such as U.S. stocks, emerging markets, and real estate.
3 Higher interest rates and stock market volatility have driven a rise in investor interest in fixed-income investments such as money market funds. And Wealthfront clients are no different. The company said there was a 130% increase in client fixed-income purchases in Q1 2023, compared to the prior quarter.
2 Other products are also vying for investor attention as they make their rates more competitive. For example, Robinhood (HOOD) recently raised rates for its Gold Cash Sweep account in May.
