Domain Money Brokerage Review | the ascent
Domain Money Strategies
Domain Money’s actively managed funds, called Strategies, are unique in several ways. First, The strategies offer passive investors a way to invest without having to research and choose their own investments. Few brokers offer both self-managed and actively managed investment options. By providing users with these options, Domain Money caters to two very different types of investors.
Second, each strategy contains at least 20% cryptocurrency, in accordance with Domain Money’s belief in the power of the blockchain. A mixed portfolio of crypto and stocks is rare, with most other full-service brokers offering one or the other. Crypto-curious investors can take advantage of the investment options offered by Domain Money strategies, but those with a low appetite for risk should steer clear.
Low barriers to entry
Domain Money strategies work similarly to hedge fund portfolios, without the hedge fund minimums and fees. With a deposit of just $100, users can invest in the Domain Edge fund. However, a minimum investment of $500 is required to access Domain Access, Domain Metaverse, and Domain Balanced funds. Compared to many hedge funds that require $100,000 or more to play, Domain Money wallets are easier to access.
Domain Money’s management fees are also much simpler than those of other actively managed wallets. A fixed rate of 1% of assets is charged annually and Domain Money does not charge a performance fee. This exceeds the “two and twenty” rule of thumb of hedge funds, whereby a fund manager can charge a management fee of 2% plus a performance fee of 20% of portfolio profits.
What could be improved
Limited investment options
While Domain Money leads the way with mixed equity and crypto funds, it leaves behind some of the more traditional investments. For a, mutual funds are not offered to Domain Money users. Also, almost all top online brokers support ETF trading, but Domain Money does not. Without mutual funds or ETFs, users looking for a diversification strategy may be disappointed with Domain Money.
High crypto fees
Beware of self-reliant crypto traders. While Domain Money allows users to trade individual cryptocurrencies, this feature costs 1.49% per trade. These fixed fees are much higher than the more common trading fees of less than 1%. Some brokers, such as Robinhood, do not charge any fees or commissions on cryptocurrency transactions.
No human advisor
Domain Money does not offer human advisors to investors. Without the support of an advisor, clients may unknowingly invest in portfolios that do not align with their risk tolerance, tax situation, financial goals, or social responsibility investing wishes. Many advisors offer personalized recommendations and premium service while charging clients a similar 1% fee. High net worth individuals may find themselves paying even less than 1% per year.