With a title like that, combined with what I’m going to write in the review, you probably are thinking that this is a sponsored post or that Sigfig has paid me. They haven’t. They just blew me away with a great product/service.
What is Sigfig? They are like Mint for investments, but built for the serious investor. I know that Mint does investments, but it is very basic. SigFig gives you a lot more data and to analyze your total portfolio.
The easiest way to show you is to give you a little tour. For this I set up my retirement accounts, so this post does double-duty… you get a view into my retirement savings and investments as well. SigFig has four areas of focus, Analytics, News, Holdings, Recommendations. A fifth area, the default view, is an overview of the other areas.
SigFig Analytics View
Here’s what the Analytic’s View looks like (click for larger view):
As you can see on the left side, I have $148,713 in my retirement accounts and I made $367 today (woo hoo!). It then shows my brokerages: Fidelity (my SEP-IRA), TD Ameritrade (my Roth IRA), and USAA (my Rollover IRA from previous 401k plans). In the center, I get a total performance view where I can see that my investment decisions are under-performing compared with the S&P 500 (there are other benchmarks to compare to against if that’s your thing).
Below the performance, you can see my asset allocation. In my opinion, this is the single most valuable section of SigFig. A couple of things stand out here. One of them is the large cash holding. That’s a relatively recent development. I worry that the markets are going head down with the Dow Jones crossing 13,000 while the national debt is at astronomical levels. You may also note the foreign equities. I’m a big believer in diversifying beyond the United States. It is increasingly a global economy and if we fall on tough times in the United States, I’m going to want my investments elsewhere to help me through that. You’ll also note the commodities. I’ve written more than a few times that I’m hedging food and gas prices with ETFs.
I can’t tell you what the 7% Other category is. I wish SigFig would allow me to look inside it and see what investments make up the percentages.
It looks like my dividend yield is 2.0%. I’m not making investment choices based on dividends, so I’m not interested in this information. Others will find it helpful though.
The Geographical Allocation map doesn’t really look like much to me. However, when I click on the “Table” instead of “Map”, I get a much more helpful view. Specifically, I find that my allocations are:
| United States | 59.05% |
| Europe | 20.68% |
| Japan | 6.38% |
| China, Hong Kong, Korea, Singapore | 5.42% |
| Australia | 2.53% |
| Canada | 2.22% |
| South America | 1.79% |
| Africa | 0.65% |
| India, Sri Lanka, Nepal, Pakistan, Bangladesh | 0.57% |
| Russia | 0.40% |
| Middle East | 0.32% |
Now, I know not only what I’m invested in, but I also know where I’m invested. This is chock full of “Epic”-ness, “Winning” or any other outdated way to express greatness.
The last part of the middle column is the Risk section. I think this area requires more explanation. It says that my equities are 9% more volatile than the S&P 500. That might be if you look at them individually. For example, I realize that the Foreign Equities part of my portfolio may carry more risk. However, look at the portfolio as a whole, with a balance in U.S. equities, foreign equities, cash, and commodities. Are you really going to tell me that I’d have less risk if I sold off all that diversification and just plunked my money in 500 U.S. stocks? Something is wrong with SigFig’s analysis here.
The right column gives some key stats against other SigFig users. I’m not sure what to make of it. Maybe if there were bell curves the ranges and if an age range was provided, I could see how I stack up to my peers.
SigFig News View
The News area isn’t unique or exciting. In fact it is so unexciting that I’m not even going to give you an image. You can get this information from just about any financial site. It is convenient to have it one place. In SigFig’s defense, there isn’t much you can do with news other than just display articles for people to read.
For me the News view is particularly useless. It doesn’t seem to include mutual funds. This left me with a view of Google news as that is the only individual stock I own.
SigFig Holdings View
Here is the SigFig Holdings View (click for larger view):
The holdings view gives you what you’d think, a list of all your investments in one place. One thing you’ll see is that I have Vanguard’s Total Market Index VTI as a core holding in all my accounts. That’s my default “invest in the US” equity. Vanguard has very low expenses and this particular ETF follows the Wilshare 5000 giving it more diversity than the S&P 500.
The other investment I should talk about is Google. It is the only thing that isn’t a mutual fund. However, in a lot of ways it is a mutual fund. I realize that Google is just a single company and much of its financial welfare is dependent on its advertising business. However, in buying Google, I feel that you get dominance in many areas: mapping, email, search, mobile and probably a few dozen areas that I can’t think of off the top of my head.
What I’m not showing in this holding view, is the tabs at the top. If I click on the Performance tab, I get information like, day’s gain, total gain, number of shares, and basis. I’m excited about the basis, because I always have to hunt for it in my brokerage’s website.
The Fundamental tab shows you things like Price/Earnings, Price/Book, Revenue Growth, etc. Since most of my investments are mutual funds and ETFs, this information isn’t available. However, it does show up for my Google holding.
Perhaps the most interesting thing in this view will get overlooked by most users. The Add a Tab section gives you the ability to customize a view of various attributes from the Stock Summary, Positions Summary, Valuation (12 months), Income Statement (12 months), and Balance Sheet (recent quarter).
You also get a Watchlist, which is an extra nice touch.
SigFig Recommendations View
Here is the SigFig Recommendations View (click for larger view):
SigFig does more than just aggregate and categorize your investment portfolio. It gives recommendations on what you can do. Of course the recommendations come with the Doublethink-ish disclaimer bar at the top that says that it shouldn’t impact your investment decision.
As you can see it gives you information on underperforming investments, hidden fees, and trading fees.
The underperforming investment area is interesting. I won’t get into the specifics of top suggestion because that is going to be the focus of tomorrow’s article. The second example criticizes my choice of Fidelity Spartan (FSIIX) and suggests PowerShares International Dividend (PID). This is similar in its international focus, but it isn’t the same. Also, since it is my Fidelity account, I don’t believe I pay the fees that it thinks I do (I need to double check this). The rationale of PID outperforming FSIIX is that it had a 7.7% better return over the last three years. SigFig seems to be suggesting that past performance is indicative of future results and that is dangerous ground to trend. It also suggested Vanguard International Equity (VEU), which I hold in other positions. Again, my decision to go with FSIIX was based on the Fidelity account (which was based on the ease of opening a SEP-IRA and low expenses), so I politely reject their recommendation.
The hidden fees area is pretty straight-forward. It makes me want to call up Fidelity and ask them for my $10 for that late settlement. Sigfig is right, that’s their own bad execution. Kudos to SigFig the watchdog (errr… pig)
The eliminating trading fees area isn’t very helpful. It says that I have a couple of holdings (VEU, VTI) that I could eliminate trading fees if I traded elsewhere like TD Ameritrade. Ironically, I own both those holdings in my TD Ameritrade account. I presume they suggest that I shouldn’t do business with USAA, but this is an area where their recommendations need updating. I perform very few trades as evidence from the holding screen. The account had $86,000 making $27 a drop in the bucket. Lastly, USAA’s exceptional and unparalleled customer support should earn it an exemption.
Realistically, I’m too rough on the recommendations. For the average person, there’s probably quite a few actionable items. I like to think that a personal finance blogger probably looked into many of the things they would suggest and chose not to take them for good reason.
Conclusion
It isn’t all rainbows and puppy dogs with SigFig. I found I have to be careful to not look at it too much. In the time it took me to write up this review I went from making $367 on the day to losing $969. It’s easy to get caught up in those kind of fluctuations when they are in big numbers right in front of you. Also, if I could make one more suggestion for SigFig, it would be to have a tool that looks at the individual holdings in a mutual fund. This could be used to report overlaps in equities due to mutual funds that are just too similar.
In the end, this is just me being nit-picky with a great product. SigFig has become my one-stop source for investing. As long as you are fine with the typical privacy concerns of allowing third parties access to your financial information (same as Mint and/or other services), I think SigFig should be at the center of your investment universe, too.
Now for the bad news. SigFig is in beta and it is invite only at this stage. However, I didn’t use any special personal finance blogger connections with them to get my invite. Maybe if you request an invest, you’ll get a response right away.
Samantha here, from SigFig. Just wanted to follow up with you to provide an explanation on how we calculate risk. We are currently using the beta to represent the risk of the portfolio, and are measuring beta relative to the S&P 500. This does mean a portfolio of foreign stocks with high beta plus the S&P 500 will have higher beta than the S&P alone. As you have suggested, you can also think about risk as the volatility of the portfolio, so that given same returns, one would prefer a portfolio that is the least volatile. Under this approach, the overall risk of the portfolio depends not only on the volatility of the individual parts but also on the correlation of those parts, meaning that as long as you have assets which are not perfectly correlated, adding more of these (in optimal quantities) would reduce overall risk.
We agree that there are different measures of risk and they can be interpreted differently person to person. As we continue to build out SigFig and add asset allocation recommendations, we will get more sophisticated in our measurement of risk. I hope that clarifies where we’re coming from but please let me know if you have further questions. We appreciate your feedback — stay tuned for future enhancements!
Thanks for the clarification. I needed a refresher of what beta represented. It’s been awhile since I used that piece of information.
I look forward to a better definition of “Risk” as the more read about beta, the less I see it being related to risk in diverse portfolio.
I got an invite for Sig Fig, clicked on it, had no idea what my username and password were, and then forgot about it until you did this article…and now I can’t find my invite email. Maybe I deleted it. If Samantha is still reading the comments, maybe she can tell us what to do in a situation like this.
Tommy, if you email me your email address, I’ll resend your invite. You can reach me at samantha [at] sigfig [dot] com.
Sigfig comes from the folks who created site wikinvest.
Thanks Wayne. I thought about mentioning it, but Wikinvest was very different and in my opinion not nearly as helpful as SigFig.
Great write-up on sigfig. I recently got an email from them, but then got wary of entering my credentials on yet another site :)
Also, have you looked at personalcapital?
In some ways it is similar – it breaks down your investments into various categories. Their business model is to try to sell you their service to manage your money – and they do call you and do a somewhat hard sell. The basic website with all the investment breakdown is free.
Just wanted to see if you or any of your other readers have any comparison between the two.
I heard of personalcapital briefly, but it was before it launched. I thought it might be for high worth individuals unless I’m remembering it wrong.
Another similar site is futureadvisor.com
I would love a review comparing these various options.
As far as I can tell, personalcapital does require 100k to invest with them. But if you don’t want that, it’s similar to sigfig.
One concern I have with most of these websites is how they expect to make money and be sustainable. Many of their employees could easily make good, stable six-figure+ incomes elsewhere. And if all these services are free, what are the chances they will still be around in a similar form 2 or 5 years down the road?
Tried to use it multiple times (using an updated Firefox, and Opera) without much success. The balances and percentages (left column) overlap and the data (center column) never gets loaded for brokerages with multiple accounts. Data for the Advice tab appears briefly, but then you click on anything the advice disappears. I inspected the HTML with firebug and saw a lot of empty divs – these are probably updated via Ajax which doesnt work as intended. In my opinion the site was very poorly designed. Its also a bit foolish to use hindsight to give recommendations and say “you could have earned X amount if you invested in XYZ instead of what your in now”. Another thing noted (and I keep track of when I provide my email to someone) is that I started getting daily spam the following day after I registered with SigFig. Guess these are part of there “Sites” as indicated in there privacy policy. I would not have expected a gambling email to be a friend of SigFig.
ConcernerUser,
I don’t know what to say, it looks and works fine in my update Firefox. That said, it is a beta release.
I have not gotten any spam since signing up.
In the mobile android app I was wondering what the number to the left of the stack of bills was. Its in the holdings screen.
I don’t have the Android app. I can’t help you there.
I just started with my free SigFig portfolio tracker. I have made purchases through my brokerage account. How do I add those purchases to my portfolio on SigFig? Thank you.
They should show up automatically in your SigFig page.