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Account Minimum: $100
Fees: No Commission or Trading Fees
Best For: Automated Trading with Fractional Shares
Warning: M1 Plus is a $125 annual subscription offering products and services from M1 Spend LLC and M1 Finance LLC, both wholly-owned, separate but affiliated subsidiaries of M1 Holdings Inc. No minimum balance to open account. No minimum balance to obtain APY (annual percentage yield). APY valid from account opening. Fees may reduce earnings. Rates may vary. National average is 0.03% as of April 2022. Obtained from the FDIC. Trading securities including stocks & ETFs involves a high level of risk.
M1 Finance is an extremely unique broker choice if you are looking to get involved in some automated trading and the world of fractional shares. In fact, it would be best described as a robo-advisor hybrid since it combines many of the benefits from this type of service while still facilitating some of your own manual trading stock trading input.
Since launching in 2015 the platform has gained great exposure throughout the industry and is now considered one of the top places for automated stock trading. The innovations here are ongoing with the ability to trade in fractional stocks as well as a facility to borrow against your portfolio both proving hugely successful.
- Fractional shares can be added to your portfolio
- Very few fees including no commissions or trading fees
- Ability to borrow against portfolio holdings at very low rates
- Pick individual stocks and ETFs or choose pre-set options
- Pre-set portfolios are expertly selected
- No instant online chat support
- You can't control exact transaction execution time
Although they have been around in the industry for a relatively short period since 2015, M1 Finance has managed to cultivate a very well-trusted reputation throughout the sector.
This is demonstrated not only through the transparent manner in which they run their operations but also by the number of traders they now have on their books. More than 500,000 people now trade with M1 Finance giving them a total amount of assets under management that runs into billions of Dollars.
When it comes to official regulation, the company is US based and therefore regulated by the SEC and FINRA in the United States. These are some of the most respected bodies in world of finance and help to ensure full compliance you can trust.
When it comes to the M1 Spend feature of the company, a banking style service that allows you use of a debit card to spend your funds, this is regulated and insured by the FDIC just as with any other top-tier bank in the country.
M1 Finance comes into its own with the range of unique investment products that are available. What makes M1 really unique is that you are investing more in creating an entire portfolio that you are in single stocks. This is done in a similar way to many other robo-advisor services but with M1 you are offered a wide selection of more than 80 different “pies”. These are expertly created groups of stocks, ETFs, and other assets that have been put together to form the entire “pie” that you can then invest in.
What you will get then is a completely diversified portfolio from the outset, and with great flexibility to choose based on your own personal risk levels. You can also create your own “pie” with as many as 100 individual assets like stocks and more if you don’t want to invest in the pre-set offerings.
The automated side of the platform then comes into play just like other robo-advisors where each asset in your portfolio or “pie” is rebalanced and managed by the system to produce the most beneficial results based on the market and your own personal needs. There are thousands of individual stocks, ETFs, and more assets for you to add to your own customized portfolio if you opt to make it yourself. You can also choose these on a fractional basis, making the platform and investment extremely accessible to everybody.
Beyond just an investment platform, there are a number of other innovative elements to the M1 offering. M1 Spend is a fully integrated digital bank that works to collect any of your excess funds into a bank account which you can access through a debit card and even earn a 1% cashback on purchases. The “Smart Transfers” feature also allows you to cap the amount that gets redirected to your M1 spend account and instead allocate it to your investment account.
That’s not all. One of the most popular features of the company is M1 Borrow. This allows you to borrow as much as 35% of your held portfolio value once you have invested over $10,000. You can borrow for any purpose and approval is guaranteed with no credit check and a very competitive repayment rate of 3.5% variable interest. M1 Plus membership is also available for $125 per year. This subscription membership will lower your interest rate on repayments to 2% variable among other benefits.
Commissions and Fees
M1 Finance represents great value when it comes to the commissions and fees side of the business. They do not charge any commissions on assets traded, nor do they charge any kind of account management fees that you usually can find with other similar services.
There are effectively no trading or management fees then, and no markups on the assets you choose to trade. The only fees that may be applied are on certain ETFs that charge underlying fees that are independent of M1 Finance.
With non-trading fees, you will note that both deposits and withdrawals are also typically fee-free with a few exceptions like wire transfers which cost $25. There are also regulatory fees when trading which are minimal, and an inactivity fee of $20 if you are not active for more than 90-days.
Overall, M1 Finance offers an astonishingly good value trading environment with no minimum deposit in place either and an account value of just $100 required to start trading.
You can trade with M1 Finance through either their web-based desktop platform or on their all-encompassing mobile app.
Both platforms provide an extremely user-friendly environment with the mobile app being particularly popular and very flexible for monitoring and managing not only your M1 invest portfolio but also your M1 Borrow and M1 Spend activities all in one place.
The platforms are very easy to use and attractively designed in a manner that makes them both simple, and effective yet with sufficient insightful detail and features like a newsfeed that will show you all the latest developments in the market.
The M1 Finance App has really taken the lead into 2020 and works as a viable and attractive solution to perform any actions you need with any of the products the company offers, so much so that the company themselves refer to it as the “Finance Super App”.
M1 Finance also performs well when it comes to providing the best in customer support. First and foremost you can utilize the extensive range of information and detailed FAQ section provided on their website. This answers many of the questions you may have at every step of the process.
If you have any other questions, these can be quickly addressed by the professional support team who are available through both email and telephone at any time when the US stock market is open. If they are not available they will also respond to you as soon as possible.
When it comes to education through the platform, this is also well provided for as much as you would expect from M1 Finance. They are a service that is very open to both new and experienced traders so you will find something to benefit you in each category.
This includes an extensive collection of articles and guides on their website that can help you get started with the service itself and pick up knowledge about trading in general. Within this, you will find many video tutorials that can also be of great help.
They are very active online and through social media with a strong presence on many social networks and tend to actively respond both on their own channels and others to keep traders and others well-informed. Recently the company also launched an email-based newsletter called “The Investor’s Mindset” offering advice particularly aimed at longer-term investors.
Overall M1 Finance is much more than just a traditional online stockbroker. They combine some of the best elements of this model particularly in the low-costs, with more popular and successful elements of a robo-advisor service and much more that results in one of the most comprehensive investment platform and overall financial offerings in the sector.
If you are looking for a trustworthy, great value, easy to use trading platform and infrastructure that provides an excellent range of solutions for all types of traders, then M1 Finance should be high on your list of services to consider. If you want to check out their service directly or even open an M1 Finance account right now, you can visit their website to get started.