A Comprehensive 2020 Review of Ally Invest

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Ally Invest gives automated investment management a new edge. This online investment advisor makes it easy to choose the right mix of assets for you. Accept the portfolio recommendation or build your combination of assets under management and equity portfolio

Ally Invest reviews call this platform “the future of finance”.  Having used the site and the app, it’s easy to see why.

ally invest reviews logo

Editorial Rating

Pros

  • No commission on some ETFs and US-listed stocks
  • Low contract fee for options trading
  • Several investment choices for the DIY investor
  • Market analysis and research tools are free to use
  • No minimum deposits
  • Overwhelmingly positive Ally Invest reviews

Cons

  • Transaction fees for mutual funds
  • No physical branches you may visit

Ally Invest Summary

Account min. deposit

$0

Account fees:

No inactivity fees

Stocks trading costs:

No commissions at over $2.00

ETFs:

No commissions

Options:

$0.50 contract fee per deal

Bonds:

Min. commission $10; $1 per bond

No-load mutual funds:

$9.95 per trade

Mobile App:

Trading, tracking, quotes

Our Comprehensive Ally Invest Review

Ally Invest offers investments for all levels of risk tolerance. Spice things up a bit with Ally Invest penny stocks or stick to bonds to protect your capital. Active traders and options traders benefit the most because of the low pricing. 

The retail investor gains entry to the stock market thanks to the site’s zero minimum balance policy. 

It’s rare to find this range of investments and financial advice on one low-commission platform.

Service Overview

Account Minimum

The Ally Invest minimum deposit is $0. This is one of the company’s big drawcards. Less confident investors and those brand-new to investing get to test the waters with little risk. The zero minimum makes it possible for anyone to save money for any goal.

Some investments have minimum requirements, but the platform has no control over that. 

Setup & Ease Of Use

With a clean user interface, simple navigation, the service is a pleasure to use. Read any Ally Invest review, and a common thread is that it’s pretty straightforward to find what you need. 

To open an account, you: 

  • Must be 18 or older
  • Be able to provide a valid social security number
  • Must be a US citizen or have legal permanent residence status
  • Have to have a US street address

You may open an account over the phone or online. Online is quicker and simpler. Go to the Ally site and select the “Investing & Retirement” tab. A drop-down menu will appear. At the far right, you’ll see a blue button asking you to “Get Started”. 

Click on that button. You’ll then have to choose between “Self-Directed Trading” and “Managed Portfolios”. 

Self-Directed Trading

Select this option if you want to manage your portfolio or don’t want to deposit immediately. You’re in complete control of your investments, so make sure you understand how markets work. 

The vendor’s website contains a wealth of information to start your investment journey. The site provides a range of useful market analysis tools to help you make informed decisions.

Managed Portfolios

This option gives you access to low-cost professional investment management. Investment advisors oversee the initial portfolio picks. The company’s custom robo advisor takes over from there. 

The robo advisor executes trades and rebalances your portfolio on your behalf. It operates very much as a traditional financial planner would at a fraction of the cost.

You might consider a robo advisor if you: 

  • Are an inexperienced investor
  • Don’t have the time to research the markets
  • Are prone to making emotional investment decisions 

A digital investment advisor tracks vast swathes of data and makes data-based decisions. It doesn’t make emotional decisions.

For this option, you’ll need an initial investment amount of $100.

When you’ve decided which option works for you, click the appropriate button. We went with “Managed Portfolios”. Click on the button, and you’ll get the basic blurb about the plan. You’ll have to press, “Get Started” again. 

They’ll ask you about: 

  • What you’re working toward
  • Your investment timeframe
  • What liquid assets you have how much you’ll invest initially
  • Your risk preferences
  • Whether you want a Core, Tax-Optimized, or Socially Responsible Portfolio

Portfolio Options 

The Ally bank investing provides six investment types. They offer forex trading as well, but you have to set that up separately. The company allows you to buy fractional shares and to reinvest your dividends. 

Ally Invest Stock

You may choose from a range of different equities listed on US stock exchanges like the NASDAQ and NYSE. Companies sell shares to raise working capital. When you buy a share, you’re purchasing the right to vote on decisions. 

Investors earn money from equities in two ways: 

  • Capital growth: If the share increases in value, your investment value increases. Be warned though, it can go the other way too.
  • Dividend payouts: Dividends are a share of the company’s profit. Their amount depends mostly on the company’s quarterly (and yearly) profit. Not all stocks are dividend earning, however.  

The stock market fluctuates over time. When demand is high, the stocks increase in value. Your portfolio’s value will rise and drop. To ride out the changes, consider it a five to 10-year investment. 

Ally Exchange-Traded Funds (ETFs)

ETFs are similar to mutual funds in that investors pool their money. What makes them different from mutual funds is that they’re not actively managed. The fund managers instead track an index, like the S&P 500. They’ll copy the movements of these indices. 

ETFs attract fewer administrative costs than mutual funds because they’re less hands-on. As they’re copying the movements of an index, their performance usually lags a little. 

Their prices move in much the same way as shares do. Investors earn money through capital growth and dividends. The fund may reinvest the profits that it makes, or share them with investors.

Ally Options Trading 

An option allows you to buy or sell assets at a predetermined rate. Instead of buying the share, you purchase an option, so it’s an excellent way to leverage a smaller asset base. You may exercise the option or not, as you choose. With these investments, you’re “betting” on the future price of the share. 

Ally Bonds

Bonds are typically considered a stable investment. They’re a loan to the bond-issuer, paying out a predetermined rate of interest. When they mature, you get your money back. You get the interest in the interim.  

They’re often issued by governments to raise capital, but may be issued by companies. The chances of losing all your money with bonds are far lower than with equities. With a guaranteed return, they’re a good option for people who need an income. 

Ally Invest Mutual Funds 

When you invest in mutual funds, you’re pooling your money with other investors. The fund managers then actively manage that investment to get the best returns. The portfolios will consist of a range of assets like cash, gold, and equities. 

Ally Margin Account

With a margin account, you borrow money from the broker to invest. You’re betting that the price of the assets that you buy will go up enough to cover the loan and interest. It’s a game that might make you money, but only if you understand the markets well. 

Portfolio Management

You control your portfolio from your dashboard on your computer or the app. Both are intuitive and easy to learn. 

Features 

Ally Invest offers several interesting features for investors. 

Goal Setup

The platform allows you to set your goals when you start. It does this to help guide you towards the right investment strategy. You may change these goals over time.

Financial Planning

The auto-investment advisor lets you sit back and take advantage of market moves. The trader works within your risk tolerance parameters to help you achieve your income and wealth generation goals. 

Build Your Strategy

You may, if you prefer, build your portfolio. If you understand something about investment, this saves you a fair amount of management fees. You’ll have to put in the effort that a financial planner would, but it can be a rewarding strategy. 

Ally Invest Drip

The Drip feature gives you control of your dividends. You may choose to feed them back into your investments or have them paid to you. It’s possible to enable a default option across the board or change the settings for each qualifying asset individually. 

Powerful Analytic Tools

There are several useful tools to help you master the markets: 

  • Streaming charts: Track movements in real-time so you can pounce on gains immediately
  • Watchlists: Create custom watchlists to keep an eye on the assets you’re interested in
  • Profit/loss calculator: This tool shows you the potential profit of the trade you’re considering
  • Probability calculator: This tool ensures that you stay on track with your targets  
  • Research and market data: Link through to detailed metrics on companies that you’re interested in
  • ETF screener: This tool makes it easy to narrow down your ETF options, allowing you to sort ETFs by price, type, or other criteria  
  • Option chains: This tool displays options-related critical data on one page 
  • Mobile trading: Connect to the market from anywhere at any time.  

24/7 Access to Exchanges

Stock markets have regular operating hours like any other business. They don’t execute trades when the markets are closed. Working through Ally Invest makes it easy to trade when it’s convenient for you. 

Set your instructions, and they’ll execute them on the next business day.

Ally Invest Cons 

Mutual Funds Fees

Frankly, the disconnect between the fees for ETFs and mutual funds is a little puzzling. At $9.95, they’re lower than a traditional broker’s fees but it’s still a lot of extra cost for an active trader in these markets. That’s particularly true when you see that other companies waive this commission. 

Customer Service 

You may contact support from 7 am to 10 pm ET on Mondays through Fridays. Instant chat is available 24-hours a day. Call the Ally Invest phone number, email your request, or use the instant chat facility for Ally Invest complaints or queries.  

Knowledge Base 

The company excels at providing research tools. Considering the price you’re paying, there’s a wealth of information at your disposal. The tools are powered by Recognia and provide live insights into several metrics.  

All customers may access the historical analysis tools free of charge. The live-streaming information is only available to you if you trade 10 or more times a month.

Commissions & Fees 

Sign up for updates and keep an eye out for discounts on the website. You’ll often find a flash Ally Invest promotion. Aside from that, the Ally Invest fees depend on the product you’re buying: 

  • Stocks trading at under $2.00: You pay a commission of $4.95 and a further $0.01 in Ally trading fees per share
  • Stocks trading at over $2.00: There are no commissions on these trades
  • ETFs: No commissions, irrespective of the trading price
  • Options: No commissions, but a contract fee of $0.50 per deal
  • Bonds: $1 per bond, with a $10 minimum commission
  • No-load mutual funds: $9.95 per trade
  • Inactivity fees: There is no Ally Invest inactivity fee

Mobile Apps 

The app is available on Android and iOS. It offers pared-down features, but still allows trading, tracking, and quotes. The app is easy to use and performs well. 

Ally Invest User Reviews 

Ally Invest reviews from 2020 are mostly positive. The company has worked hard to improve its customer service, and recent Ally Invest reviews on Reddit, for example, bear this out. If we look at comments about the Ally managed portfolio on Reddit, most users are satisfied. 

Ally Invest reviews elsewhere, however, are mixed. Most consumer sites lump the reports for all the divisions of the bank together. This distorts the picture a great deal because it includes angry loan clients.

The Positives 

Users appreciate how well the platform works and how easy it is to learn. They like the low fees and wealth of informational tools. They found it easy to manage without intervention from the help desk. 

The Negatives 

Ally Invest reviews on Consumer Affairs and the BBB point to lapses in service from employees. The general rating on both sites is bad, but if you look into it more closely, you’ll see that this is more because of historical behavior. The company used to have a bad habit of not replying to complaints on consumer sites. Many complaints referred to the loan process rather than the investment section.  

Is Ally Invest the Best for You?

The service complaints prevent us from ending this Ally Invest review with a five-star score. It’s clear that the company has made progress in this department, so we’re still willing to work with them. 

On the upside, you seldom need to interact with customer service. It’s easy to set up an account and use it. The technological side of things limits your interaction with employees substantially. 

You’re left with a clean interface that makes investing both affordable and straightforward. The low minimum deposits remove the other barriers to entry.  

Alternatives to Ally Invest

Ally Invest vs. Wealthfront

Wealthfront offers better features, but their charges are higher. You’ll also need to invest a minimum of $500 to get started. If you compare Wealthfront and Ally Invest reviews, the service is the same at both.

If you’d like to learn more about Wealthfront, read our comprehensive review here. 

Ally Invest vs. Betterment

Betterment offers clients the opportunity to speak to a certified financial planner over the phone. This may be an advantage to someone with an extensive portfolio or someone who prefers personal service. At around $150 for 45 minutes, the calls are pricey. Ally Invest meanwhile doesn’t have this option at all. 

If you’d like to learn more about Betterment, read our comprehensive review here. 

Ally Invest vs. Ellevest

Ellevest caters specifically to women. They work in factors like a woman’s salary gap to give the best results. If you’re a seasoned investor, the costs might make this option prohibitive. Investors pay a monthly fee in addition to a trade fee. 

Ellevest is a pricier option. Still, if you’re interested in a platform targeted at women, read more about them here.

Wrap Up 

The company offers competitive rates, a simple interface, and useful tools. The low minimum amount makes it simple for new investors to get started. It’s a good option for active traders in equities, options, and ETFs because of the low commission structure.

Ally Invest reviews peg the margin rate as high and object to the commission on mutual funds. If your portfolio focuses on these options, consider other brokerages.

Sales Pitch 

Ally Invest provides a reliable robo advisor and a simple interface. The dashboard offers a comprehensive view of your investments, while the software performs at a far higher level than the low commission structure would lead you to think. Overall, the firm provides a robust investment tool and excellent value for money.

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Editorial Rating

Ally Invest FAQ

What is Ally Invest?

The company is an online brokerage firm that caters to investors at different levels. Clients may manage their portfolios themselves or use the automated investor. The primary benefits of this company are the low costs and low investment minimums.

Is Ally Invest legit?

Yes, it's over eight years old and FDIC-registered. The holding company, Ally Financial, has a market cap of $8.35 billion.

How does Ally Invest make money?

They do that by charging contract prices on options, through their margin rates, and by charging trade commissions.

Should I use Ally Invest?

It’s a legitimate site with a stable platform. The low fees and minimum investment make it an attractive option. Whether you should use it, however, depends on your circumstances, available resources, and financial knowledge.

How long does it take for Ally to settle funds?

It depends on the type of investment. Settlement takes between one and three working days. You may reinvest the money immediately for most instruments. Day traders, however, must wait until the next day to reinvest the proceeds of a sale.