BMO InvestorLine adviceDirect Review
The Bank of Montreal (BMO) was the first of the Big Five banks to embrace the robo-advisor trend with its BMO SmartFolio online investment portfolio management service.
But for those who want to invest online with more control and less automation, BMO also offers its InvestorLine platform. InvestorLine comes in two varieties: BMO InvestorLine Self-Directed, where investors manage their portfolios with total independence, and little known BMO InvestorLine adviceDirect, where investors are guided with personalized advice and constant monitoring tailored to their specific investor profile, but are still responsible for making all final investing decisions.
In This Article:
What Is adviceDirect?
BMO InvestorLine adviceDirect should not be confused with a robo-advisor, in that it does not automatically invest your money across a portfolio of ETFs based on your stated risk-tolerance and then use an algorithm to automatically re-balance that portfolio within that risk-tolerance over time. It’s not even a hybrid robo-advisor, which pairs those algorithms with monitoring from a human portfolio manager.
Instead, it can be thought of as an online brokerage with the added advantage of built-in investment advice and monitoring. You choose your securities, how many shares you want to buy or sell, allocate your own assets, execute your own trades and ultimately balance your portfolio as you see fit. But the appeal of adviceDirect is that it constantly makes sure you stay within your investor profile (the type of investor you told it you want to be). Here’s how:
- The platform monitors your portfolio and alerts you when your investments are veering outside your investor profile.
- It tells you what parts of your portfolio need to be re-balanced to fit your investor profile.
- It recommends securities to buy, sell and hold that will put your portfolio back within your investor profile.
- It shows you how your portfolio will be affected by investment recommendations before you execute a trade.
- It provides you with a team of BMO Investment Specialists that you can call if you have questions or need more detailed investment advice.
Interface and Usability
adviceDirect has a clear interface that addresses any issues with your portfolio using a simple red or green colour code.
The overview divides your portfolio into four quadrants that make up a pie chart: risk, asset allocation, diversification and rating. Whenever any one of those quadrants are red, there are issues that need to be addressed and when they are green, your portfolio is aligned with the goals of your investor profile.
The red and green motif is present throughout adviceDirect’s interface, making it easy to see where the issues are at a glance. The recommended securities listed also follow this pattern: Those rated from 1-49 are coloured red and deemed a sell; those 50-59 are yellow and deemed a hold; and those 60-100 are green and deemed a buy.
Research is provided into North American stocks by Market Grader, which will tell you why certain securities are given the rating they have. If you simply wish to fix the problems and rebalance the portfolio toward your investor profile, you can press the “Take Action” button. adviceDirect will then tell you exactly what you need to do to correct any issues (though you make the final trade).
The platform allows you to experiment, because no move you make becomes permanent until you click the “execute” button. All of your planning is “in pencil” until you execute, which gives you the freedom to see the consequences of your actions before they happen. This is one of adviceDirect’s best features if you want to try your hand at managing your own investments, but still consider yourself a relative beginner at investing.
Cost and Fees
The advisor fee for adviceDirect is all-inclusive and includes a pre-determined number of annual trades based on your level of assets. The minimum amount of assets for adviceDirect is $10,000. Fees break down as follows:
| Assets | Advisor Fee |
|---|---|
| $10,000 - $500,000 | 0.75% x billable assets annually |
| $500,001 and up | $3,750.00 maximum annual fee |
Below are the adviceDirect annual trade limits at prescribed asset levels:
| Total Assets | Annual Trades |
|---|---|
| $10,000-$50,000 | 15 |
| $50,000.01-$150,000 | 30 |
| $150,000.01-$200,000 | 45 |
| $200,000.01-$250,000 | 55 |
| $250,000.01-$300,000 | 65 |
| $300,000.01-$400,000 | 80 |
| $400,000.01-$500,000 | 100 |
| $500,000.01-$750,000 | 130 |
| $750,000.01-$1,000,000 | 160 |
| Greater than $1,000,000 | 185 |
adviceDirect accountholders are charged $7.95 per trade for every additional trade over their annual trade limit.
The Verdict
adviceDirect is a good investing platform for those who want the control and oversight of managing their own portfolio, but also want professional investment advice.
Use It If…
- You want to trade on your own, but still want professional investment advice without paying a financial advisor.
Don’t Use It If…
- You are a day trader, options trader or power investor who doesn’t need someone to hold your hand and isn’t interested in long-term investing.
- You would rather your investments perform automatically without your regular monitoring/oversight.
Author Bio
Article comments
I just joined adviceDirect. The user interface for their release 2.0 does not allow me to transfer money into the account. It took days for me to get from the application process before I received an email that the account is set up. Now that it is set up and prompts me to transfer money, each time I do the Continue button changes colour but nothing else happens.
Hi Bob,
That sounds frustrating. Thankfully, you arrange for someone to call you using their Let Us Contact You service. Alternately, you can schedule a virtual meeting to have someone walk you through the issue. Good luck!
Recently moved our accounts to Advice Direct, but not impressed. Accounts still not set-up as requested. Three day response time for email inquiries. Getting through on the phones takes up to one hour. Beginning to think moving our accounts was a big mistake. Questions and concerns still not addressed.
Hi Glenda,
I’m disappointed that it’s not working out for you so far. I hope either they get back to you and redeem themselves or you’re able to switch to an investment platform you’re happier with. If you’re looking for some alternatives, check out my article on robo-advisors. I wrote it in 2018, but it has apparently been updated for 2021. https://www.greedyrates.ca/blog/compare-top-robo-advisors-canada/
BMO advicedirect:
Three years ago I moved every investments we had from a variety of providers. Objective to get them all into one place with good visibility. RIFF, Spousal RRSP, 2 X TFSA’s, RESP with 2 beneficiaries. This article seems to fairly clear and accurate. This move was one of the best decisions I ever made. The adviser telephone help is pretty awesome, I have more easily accessible information at my fingertips than I can use. When the stock markets are open trades happen in seconds, mutual funds take a little more time. Fees seem high until you consider what you get for your money. Ties in seamlessly to BMO banking accounts and credit card. I have nothing I can complain about. Yes sometimes the phone support may be a little slow depending on call volumes but not as bad as a lot of other online help. However it does take a little time to manage. Maybe an hour a week to look things over. Bust now trying to take advantage of the low prices. One last one easy to do dollar trading during business hours with no fees.
Awesome Andrew,
Any part we played with this review. We’re really glad we could help. Your story is one we hope for.