An cunning strategy to consider (tongue in cheek).
Suppose you have a pie of 20 equally weighted stocks and want to invest £10, so 50p each. You are frustrated that this is no longer possible because of the £1 minimum.
How about you invest £30, so £1.50 each? Now immediately sell £20 and you’ll be left with your desired investment. The cost will be the spread of 0.1% on £20, and so a mere £0.02, an insignificant sum well worth paying. You may even make money if prices rise between your £30 buy and £20 sell.
Personally, I would let the £30 ride and skip my next two scheduled investments of £10. (Please note the parenthetical remark in the first sentence above.)
@DonDima you clearly misunderstood, the point was to explain that I largely understand how it works and also working on developing a commerical brokerage platform for a different market.
I’m not comparing T212 to my potential product, they are different. And anyhow everyone starts small and from scratch. It took 2 decades almost for T212 to reach here.
Buddy I think @wouter1182 is having another issue, I’m not sure it’s because of the minimum investment, because his pie order will not go through and fail as he says if the minimum is not met…
Can’t say more until he shares the error or a screenshot.
I was not intending to reply to @wouter1182, simply to add a tongue in cheek comment to discussion of the original topic. Thought some might find the cunning idea amusing.
Does it show as a reply to him? I cannot see. Perhaps I hit the wrong reply arrow. There is one below a post and another for a topic.
Of course but then why do you doubt the explanation of a staff member?
The pies themselves are occupying space in the system (I suppose they are cloud-stored, correct me if I’m wrong), and that it’s costly to maintain an infinite number of them, with one million clients the number of pies could easily be 10 million right now and constantly growing in progression.
It could be limited, let’s say, to 5 per client which would be waaay more restrictive measure than what we have got.
I beg to question now, how will having a minimum slice investment per pie going to solve this issue?
Cloud storage is very cheap, since it’s all text (non-media) storage, a pie doesn’t take GB or something. And also they are infrequently accessed, you could effectively put them in S3 or glacier/cold storage. Safe and cheap.
The minimum amount to deposit to a pie that consists of 200 0.5% slices will discourage people to create pies like this. With the social pies feature added, it’s just too convenient. I assume the number of pies copied with this new feature skyrocketed.
You can have 20 pies with a hundred slices each and this will eventually add up.
So the management decided to put a limitation to avoid further possible major expenses to invest the money in new features and improvements, I see nothing wrong with that.
You are right about the adoption skyrocketing by introducing social pies. I wasn’t expecting this to land, before important features like granular control of pies, invest from banking channels or account funds directly, limit fractional orders. So T212 called for the growth itself.
First of all, the limit for slices is 100, so 200 is not possible. 0.5% is minimum allocation. Your argument of this lowering number of pies is false, this may reduce the number of “pie order” in the short term, but the growth will again overtake the current pie order numbers in the midterm if the current growth in users continue.
I think that it would be a good solution if it would be possible to deposit any amount of money into a pie, and then when enough money is collected in a pie, they would be invested.
Lets say for example, that minimum required amount of money to be invested in a pie is 100 GBP.
This month I deposit 50 GBP into a pie. Next month I deposit another 50 GBP. Total amount of money is 100 GBP and now they can be spread over stocks in a pie. There also should be a choice of fund distribution ( By targets, Self-balancing, Custom)
Of course this is not a perfect solution, but it allows us to deposit small amounts of money into each pie.
In my opinion the whole idea of pies and autoinvest now is broken. I have 3 pies which are being added 50e, 30e an 25e every week. Now, I cannot use that because the minimum invest is 200e. the main idea was keep close avg as it was buying shares every week and I don’t need to bother to check it. A bit unfair the answer from T212 like “it is free”… So in the end we need accept everything that is just pushed on the updates? Anyways, as I cannot do nothing and it breaks my main idea of investments is time to try find another solutions. So far I’m using coinbase weekly idea too but someone already used another platform related to stocks on EU ?
Let me shares some personal thoughts on this issue, if I may.
It is generally considered by professional wealth managers I have known at Rathbones, Schroders, etc that a client portfolio of about 25-30 well chosen stocks plus some ETFs (to cover niche sectors or regions) can provide adequate diversification. When I used to rely on a Merrill Lynch professional he had me in 23 stocks only.
Terry Smith has about 24 stocks in his highly successful Fundsmith portfolio. I have a pie of just 10 of his stocks and it the best performer of mine since pies were introduced. My second best performer is a pie of 3 slices.
This change may actually be a help in causing people to rethink their strategy. There is a temptation, from which I have suffered myself, to confuse the art of portfolio construction with stamp collecting.
I have several pies, but never go below 5% for a slice. Slices of 1% or 0.5% are unlikely to ever add significantly to my wealth. Other of my pies have 10, 10, 3, and 4 slices. All would accommodate a £10 top up if I wanted to invest that.
This is a great point. As much as I’ve enjoyed playing around with pies for a while, I had a rethink and abandoned ship a month or two back. Having hundreds of holdings was ridiculous, so I took profits and refocused on my pre-existing 30-stock portfolio, which I know inside out.
It’s been great to get back to being more discerning about fundamentals and price, buying the recent dips in Alibaba and Tencent, as an example, and oh how I’ve missed limit orders!
I have an ETF pie which is 50% of my portfolio and contains 6 ETFs, USA pie containing 6 companies, UK pie containing 8 companies, a Swing pie containing 2 (which chops and changes weekly, and is the only one to do so) and a pie with 1 ETF in for my daughter.
The problem that has occurred for me with the pie change is that I’ve mirrored ARKG, this isn’t me looking at individual stocks neccessarily, I am looking at the gross total at all times of review. The previous 12 months performance of ARKG speaks for itself, and it is a little frustrating that now a 200 minimum is in place.
Don’t get me wrong, it’s not some doomsday moment, but nonetheless it’s annoying and I’ve changed my strategy with it now to accommodate the changes.
Back to your original point about not collecting stocks like stamps, I couldn’t agree more. My problem is that I’m mirroring an ETF which isn’t available in the EU, and it’s probably the same for many users.
It’s that physiological barrier of adding to something that’s heavily green, but typically a good company will continue to grow over a long period of time.
Also, the “quest for the new shiny object” is often counter productive
