The first product will be a simple guided tool - after setting up your portfolio preferences we will monitor your brokerage account(s) in a “read-only” fashion, and notify you when trades are needed to maintain your portfolio (e.g., rebalancing, tax-loss harvesting, etc). Assuming you agree with us, you will then go make the trades yourself.
Eventually, we will streamline this process into a “push-button” approach where you can easily agree/disagree with our recommendation and we will do the trades for you in the background.
A big part of our philosophy is empowering individuals to take control over their own finances, and the cornerstone to this is education. Our goal is to not only suggest trades, but also explain the “why” behind them, so you always feel confident that your portfolio remains optimal.
There are a lot of reasons to choose Optimal:
Pricing. Traditional roboadvisors charge 0.3%-1.0% all in. This means that as your account grows, your fee grows. In contrast the advanced features of Optimal will be available for a low fixed monthly fee. As your account grows, your fee stays the same. Over many years these savings will compound dramatically.
Flexibility. Traditional roboadvisors are custodians of your money, which requires you to open an account with them and move money there. Optimal does not hold your money - you choose where you keep your money, and always remain in control.
Customizable. Traditional roboadvisors will place you in a standardized bucket based on your risk preferences. Optimal will let you build truly unique portfolios (often referred to as “custom indexing”). Of course, if you don’t want this, we have the standard buckets as well.
We are still working out the details on this. While the product remains in its early stages, we would like to provide it to early adopters for free. In return, we will probably bug you for feedback to help improve things. Longer term, we will likely have a free tier for basic use, and will charge a low fixed monthly fee for more advanced features (like tax-loss harvesting and direct indexing).
We have encountered a lot of investor confusion regarding the merits of TLH. Up to $3,000 in losses can be written off against income every year. Any losses beyond that can only be used to offset gains in that tax year - and unused losses will be carried forward indefinitely until used.