SoFi Active Investing Review 2023: Pros, Cons and How It Compares
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Our Take
4.1
The bottom line:
on SoFi Invest's website
Pros & Cons
Pros
Commission-free stock and ETF trades.
Fractional shares available.
Free financial counseling.
Cons
Small selection of tradable securities.
No mutual funds.
Low interest rate on uninvested cash.
Compare to Similar Brokers
Current Product
NerdWallet rating 4.1 /5 | NerdWallet rating 4.9 /5 | NerdWallet rating 5.0 /5 | NerdWallet rating 4.7 /5 | NerdWallet rating 4.1 /5 |
Fees $0 per trade | Fees $0 per trade | Fees $0 per trade | Fees $0 per trade | Fees $0 per trade |
Account minimum $0 | Account minimum $0 | Account minimum $0 | Account minimum $0 | Account minimum $0 |
Promotion $5 to $1,000 in free stock for users who sign up via mobile app | Promotion None no promotion available at this time | Promotion None no promotion available at this time | Promotion Get up to 70 free fractional shares (valued up to $3,000) when you open and fund an account with Webull. | Promotion Get up to $700 when you open and fund a J.P. Morgan Self-Directed Investing account with qualifying new money. |
Learn more on SoFi Invest's website | Learn more on Charles Schwab's website | Learn more on Interactive Brokers' website | Learn more on Webull's website | Learn more on J.P. Morgan's website |
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Full Review
Where SoFi Active Investing shines
Beginner investment platform: SoFi Active Investing is squarely aimed at young investors with free trades of stocks, exchange-traded funds and options, plus fractional shares of blue-chip companies such as Amazon and Netflix.
IPO access: SoFi offers unique access to initial public offerings before they're traded on the public markets — all SoFi account holders are eligible. This is notable because IPO access is often only available to institutional investors.
Related products: The self-directed brokerage is part of the San Francisco company's growing line of financial products — which includes robo-advisor SoFi Automated Investing and online cash management account SoFi Banking — and gives members benefits such as free educational seminars and meetings with financial advisors.
Access to financial advisors: All SoFi clients have unlimited access to the company's financial advisors at no extra charge to help with long-term financial strategy.
Where SoFi Active Investing falls short
Investment selection: While SoFi Active Investing has bells and whistles such as fractional shares and IPO investments, there are no mutual funds, index funds or bond funds available through the brokerage, which is a big downside for retirement investors.
SoFi Active Investing is best for:
Active traders.
ETF investors.
Fractional shares.
Options.
SoFi Active Investing at a glance
Account minimum | $0. |
Stock trading costs | $0. |
Options trades | No contract fees. |
Account fees (annual, transfer, closing, inactivity) | No account fees; $75 partial or full outgoing transfer fee; $25 inactivity fee is easily avoided. |
Interest rate on uninvested cash | 0.01% |
No-transaction-fee mutual funds | Not available. |
Tradable securities |
|
Trading platform | Slick interface; limited tools. |
Mobile app | Access to core account functions including tracking, quotes and trading. Available on iOS and Android. |
Research and data | Limited selection of research and tools. |
Customer support options (includes how easy it is to find key details on the website) | Phone and chat support 5 a.m. to 5 p.m. PT, 7 days a week. |
More details about SoFi Active Investing's ratings
Account minimum: 5 out of 5 stars
SoFi has no account minimum.
Stock trading costs: 5 out of 5 stars
SoFi Active Investing came out of the gate as a competitor to Robinhood, offering free stock and ETF trades. However, toward the end of 2019, free trades became the industry standard at online brokers, causing the offerings from SoFi and Robinhood to lose their edge.
Options trades: 5 out of 5 stars
SoFi's commitment to low-cost trading also shows in its new $0 options trade offering, which charges no contract fee.
Account fees: 2.5 out of 5 stars
SoFi Active Investing charges no annual fee, though there is a $75 full or partial outgoing transfer fee. There is a $25 annual inactivity fee, but you can avoid that without much work: all you have to do is log into your account at least once a year.
Interest rate on uninvested cash: 1 out of 5 stars
SoFi offers a low 0.01% interest rate on uninvested cash, and even to receive that, you have to opt into it. This is a departure from some other brokers, where the default interest rate on uninvested cash can be as high as around 5%.
Number of no-transaction-fee mutual funds: Not rated.
As noted above, one of the big downsides of SoFi Active Investing is the unavailability of any mutual funds.
Tradable securities available: 4 out of 5 stars
SoFi Active Investing may be leading the way with fractional shares, options and now IPO offerings. It also offers ADRs, or American depository receipts, which allow customers to easily buy shares in foreign companies.
That said, the brokerage is behind the curve on other investment options. Want to buy mutual funds, index funds and bonds — bedrock investments in most retirement accounts — or more advanced strategies such as forex and futures? Look elsewhere.
Editor's note: In Nov. 2023, SoFi Active Investing ended its crypto offering. Customers with crypto accounts at the brokerage were given the option to transfer those crypto assets to Blockchain.com .
Trading platform: 3.5 out of 5 stars
SoFi Active Investing offers a straight-forward trading platform with very limited features without the bells and whistles serious traders may enjoy.
It does have a simple interface for new investors, though, and some of its offerings help the company live up to the "social" aspect of Social Finance. For instance, you can look at the holdings of well-known traders to see how your ideas compare to theirs.
Signing up and funding your account are relatively easy, though unless you have a clear idea of what you want to invest in, you may wind up having to look elsewhere as you decide what to buy. SoFi doesn't have a lot of the screening, comparison and research tools that its top-tier competitors offer.
SoFi's trading hours are relatively expansive: from 9 a.m. to 8 p.m. Eastern, and SoFi does facilitate over-the-counter trades for free.
It's also important to note that SoFi does accept payment for order flow, which is a common practice among discount brokers. But it does mean that SoFi (and many others) may earn more if it routes your order to the market maker that offers the best payment rather than the optimal consumer price.
The company's execution quality is 95.97%.
The average execution quality of all brokers we review was 97.4% as of August 31, 2023. That means 97.4% of orders were executed at a price that was at or better than the National Best Bid and Offer. Executing at or above the NBBO means you may receive price improvement, or a better share price than you were originally quoted.
Mobile app: 5 out of 5 stars
SoFi Active Investing has two free mobile apps, available for iOS and Android, both highly rated by iOS and Android users, that allows users to make trades, as well as track performance and get real-time quotes.
Research and data: 2 out of 5 stars
Sofi has a sampling of free online resources, such as historical data and stock performance, as well as webinars and live events. But it lacks the research capabilities you might find elsewhere.
Customer support options 3.5 out of 5 stars
Customer support is available via email and chat, as well as by phone from 5 a.m to 5 p.m PT every day. Note, however, that investing-specific help is only open on weekdays.
Is SoFi Active Investing right for you?
SoFi Active Investing has attractive features for new investors: commission-free stock, ETF and options trades, a $1 account minimum, free financial counseling and cutting-edge offerings including fractional shares and IPOs. However, the lack of investment options — such as mutual funds and index funds — will be a turnoff for long-term investors, and advanced investors will need to go elsewhere for forex and futures trading.
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on SoFi Invest's website
