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MoneyFarm or funny farm?

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aajax42
aajax42 Posts: 65 Forumite
in Savings & investments
MoneyFarm, Italy-based FinTech company, Robo investing.Get £20k managed free with MoneyFarm.

I just wondered if anyone has had any dealings with this company and what your views are?
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Comments

  • masonic
    masonic Posts: 27,236 Forumite
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    It's FSCS protected and the headline charges look about where they should be, so no immediate alarm bells. This offering looks on the surface to be preferable to the likes of Nutmeg, but that's just based on a quick look.

    It looks to me that it's only the first £10k that is managed for free.
  • aajax42
    aajax42 Posts: 65 Forumite
    They are offering a code through money observer at the moment that gives £20k managed free.
  • colsten
    colsten Posts: 17,597 Forumite
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    The name reminds me of Animal Farm.
  • badger09
    badger09 Posts: 11,578 Forumite
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    colsten wrote: »
    The name reminds me of Animal Farm.

    All Robo Investing companies are equal, but some Robo Investing companies are more equal than others :p
  • dunstonh
    dunstonh Posts: 119,688 Forumite
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    How long does the £20k free last for?

    A number of the robo-advice companies have poor financials. Their model is to be achieve a certain amount under management and aim to be bought by a larger player. So, it may well make sense to remain under the FSCS limit or make sure the money you invest is money that you are not likely to need to call upon should the worst happen (failure would mean you are unlikely to lose money. Just lose access to it for a while whilst administration is sorted.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • peter_333
    peter_333 Posts: 123 Forumite
    Ninth Anniversary 100 Posts Name Dropper Combo Breaker
    Hi aajax42. Is that a public code for MoneyFarm? Is it still valid? Could you share it?
  • moneyfoolish
    moneyfoolish Posts: 681 Forumite
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    masonic wrote: »
    This offering looks on the surface to be preferable to the likes of Nutmeg, but that's just based on a quick look.
    Why does it look better than Nutmeg?
  • dunstonh
    dunstonh Posts: 119,688 Forumite
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    moneyfoolish wrote: »
    Why does it look better than Nutmeg?

    Have you seen Nutmeg's financial state?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • moneyfoolish
    moneyfoolish Posts: 681 Forumite
    Part of the Furniture 500 Posts Name Dropper
    dunstonh wrote: »
    Have you seen Nutmeg's financial state?
    No. I assume it's not great from your comment. But is MoneyFarm likely to fare any better?
  • masonic
    masonic Posts: 27,236 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    edited 26 August 2016 at 7:05PM
    moneyfoolish wrote: »
    Why does it look better than Nutmeg?
    I was looking mainly at the charges. Nutmeg's funds have not performed very well in part because it has quite high charges.
    moneyfoolish wrote: »
    No. I assume it's not great from your comment. But is MoneyFarm likely to fare any better?
    Nutmeg has been loss making from the outset, which is perhaps not unusual for such a venture in the first few years, but Nutmeg's losses have been increasing each year (>£5m was the figure I last saw). So either Nutmeg is doing something wrong, or the market isn't there to support such a product.

    In some sense, this isn't of great concern to a user of the service, since their investments will have FSCS protection if they keep within the £50k compensation limit. There is, of course, the inconvenience associated with having to go elsewhere if the service is withdrawn.

    Edit: Of course the other thing to consider is that a loss making venture may need to hike its charges in order to move into profit, perhaps after luring in a suitable number of apathetic customers who won't be bothered to go elsewhere.
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