Our Rating: 4.5 / 5
Bottom Line: Extensive research went into this WealthBar (Now CI Direct Investing) review to see how it stacks up against other robo advisor in Canada. It’s a winner: WealthBar (Now CI Direct Investing) has competitive fees, a great design, and excellent customer service, making it one of the top robo advisor in Canada.
- Diverse investment options (including private portfolios)
- Exceptional past performance
- Financial planning tools available for every client
Promo: Get your first $10,000 managed for FREE for the first year
WealthBar formally rebranded as CI Direct Investing on August 5, 2020. CI Direct Investing is part of CI Financial, one of the country’s largest investment companies. Under this new brand, clients continue to have access to professionally managed portfolios and financial advice at their fingertips.
Vancouver-based WealthBar (Now CI Direct Investing) launched in 2014 by co-founders and husband and wife team Tea and Chris Nicola. Tea worked as a financial advisor, while Chris got started in the financial world working for his father’s wealth management company, but also cut his teeth as a software and web developer. They both worked on and off for John Nicola, owner of Nicola Wealth, who has a clientele comprised of high net worth individuals and has $6.4 billion in assets under management. When Tea and Chris wanted to make financial advice available for the other 99%, they created WealthBar (Now CI Direct Investing) with John’s support.
The other members of WealthBar (Now CI Direct Investing) impressively include portfolio managers, CFA designates, and financial advisers – all of whom have a fiduciary duty to their clients. Of course, the growing team also includes marketers, software developers, graphic designers, and much more. In January 2019, CI Financial announced it had completed its acquisition of a majority stake in WealthBar. Terms were not disclosed.
WealthBar (Now CI Direct Investing) fits nicely into Canada’s robo-advisor landscape as an alternative to Wealthsimple and Nest Wealth. It offers comparable pricing and on-boarding for new clients, and a similar user experience with a great online and mobile platform. WealthBar (Now CI Direct Investing) stands-out for its financial planning tools – which are available to every client – and a wide-range of investment options, including private portfolios that offer hedge-fund like diversification. Unlike some other robo-advisors, WealthBar (Now CI Direct Investing) displays the performance of its portfolios online for the world to see – and the results to date have been exceptional. WealthBar (Now CI Direct Investing) bills itself as “Wall Street Investing for Main Street Canadians. Premium online investing, without the premium prices.”
WealthBar (Now CI Direct Investing) Features
Here are some of the features that make WealthBar (Now CI Direct Investing) stand out:
|Accounts||Cash/Personal/Non-Registered, Joint, TFSA, RRSP, Spousal RRSP, RIF/RRIF, LIRA, LIF, RESP, RESP for Quebec residents, RDSPs, Corporate, PPP, IPP, Trust accounts, Accounts for charitable organizations, Group TFSAs & RRSPs for companies to offer staff|
|Tax loss Harvesting||Yes|
|Advice Type||Mostly automated, with unlimited financial advice provided by a team of licensed portfolio managers|
|Socially responsible investing||Yes|
|Access||Online, app, and mobile device|
|Transfer Fees||Reimbursement for transfers $25,000+ (up to $150 in fees)|
|Young and Thrifty promo:||Get your first $15,000 managed by WealthBar for FREE for the first year (with a minimum deposit of $1,000).|
- Free Financial Planning: WealthBar (Now CI Direct Investing) advisors provide advice and financial planning services, including a free professional review of your plan by one of their licensed financial advisors, all of which is included in their fees.
- Tax Loss Harvesting: WealthBar (Now CI Direct Investing) provides tax-loss harvesting on a case-by-case basis when a market event occurs and when it makes sense to tax loss harvest.
- Private Investment Portfolio Options: Clients have access to high-end investment classes, such as private investments that can offer unique diversification benefits.
- Transfer fee reimbursement: If you already have an investment portfolio valued at more than $25,000 at another financial institution, WealthBar (Now CI Direct Investing) will cover the fees your broker charges to transfer out (up to $150). They also offer a risk-free trial – so if you don’t feel WealthBar (Now CI Direct Investing) is a fit for you, they don’t charge a transfer-out fee.
- SRI Portfolio Option: Investors have the ability to add Cleantech – a socially responsible investment fund focused on innovations in clean energy (like solar and wind) to any of their portfolios.
- Proven Performance: Founded by the Nicola family, a family with a successful track record in wealth management for over 40 years.
- Automatic re-balancing. WealthBar (Now CI Direct Investing) will automatically adjust your asset allocation if it deviates from your original target by more than 5%, when distributions or contributions are made to the account, and at a minimum quarterly.
- Insurance: WealthBar (Now CI Direct Investing) also sells independent insurance and they are a Full Life Insurance Agent in the provinces of British Columbia and Ontario.
WealthBar (Now CI Direct Investing) Fees
WealthBar (Now CI Direct Investing) has a multi-tiered pricing system and charges a fee dependent on your portfolio value. The fee that you pay WealthBar (Now CI Direct Investing) includes transaction costs, administrative costs, and financial planning. If your fees are in a tax-deductible account, you can deduct the fees on your tax returns.
|Fees:||$0 - $150k: 0.6%/year |
$150k - $500k: 0.4%/year
|ETF MERs:||Non-SRI: 0.19% – 0.26% MER |
SRI: 0.29% – 0.37% MER
In addition to these fees, there will be a fee of 0.19% – 0.26% MER for the ETFs held inside your portfolio. That puts the total cost at around 0.80% for clients with less than $150,000 in assets.
Then there’s the WealthBar (Now CI Direct Investing) Private Investment Portfolios, where clients can access so-called premium investments, previously only available to the ultra-wealthy.
These portfolios add exposure to unconventional investment assets such as private equity, real estate, mortgages, alternative strategies, commodities, and preferred shares.
One example is the WealthBar (Now CI Direct Investing) Balanced Private Portfolio, which is 100% invested in NWM254 – Nicola Core Portfolio Fund.
As you can see the MER is quite a bit higher (at 1.56%) than the standard portfolios by WealthBar (Now CI Direct Investing). That’s because these kinds of private investments are normally only available to investors with $1 million or more in assets. When you get a hedge fund-like portfolio, you should expect to pay hedge-fund like fees.
But because of its ties to Nicola Wealth, WealthBar (Now CI Direct Investing) are able to offer this more diversified pool of assets (which includes direct real estate and infrastructure holdings) to any Canadian with $1,000 or more to invest. Kind of a neat feature!
Pros and Cons
Consider these pros and cons when determining if WealthBar (Now CI Direct Investing) is right for you.
|40 years of proven performance in wealth management backing WealthBar’s investment portfolios||Management fees are slightly higher than industry average, with all-in fees coming in at around 0.85%|
|Access to Private Investment Portfolios for clients seeking more diversification|
|Access to a team of licensed financial advisors, all held to a fiduciary standard|
|Access to financial planning for every client|
The WealthBar (Now CI Direct Investing) Investing Model
WealthBar (Now CI Direct Investing) investment philosophy boils down to a simple equation: Diversification + cash flow = better returns.
They take a low-risk and long-term approach to investing, managing volatility and focusing on cash flow to get their clients to a comfortable retirement. Broad diversification spreads your money across more investments to take advantage of opportunities when markets rise and fall over the long term.
WealthBar (Now CI Direct Investing) carefully selects ETFs that meet the following criteria:
- Low tracking error to better mirror the benchmark index
- Higher trading volume to get the best pricing
- Higher assets under management
- Lower share price
- Country of origin consideration (to reduce currency exchange fees)
- Successful performance history
- Lowest MER possible
WealthBar (Now CI Direct Investing) offers five different portfolio options:
- Safety ETF Portfolio: To preserve and protect. This portfolio is made up of 16% equities, 69% bonds, and a mix of real estate and preferred shares.
- Conservative ETF Portfolio: For protection and steady growth. This portfolio is comprised of 29% equities, 56% bonds, and a mix of real estate and preferred shares.
- Balanced ETF Portfolio: For moderate growth with some volatility. This portfolio is made up of 44% equities, 41% bonds, and a mix of real estate and preferred shares.
- Growth ETF Portfolio: Growth focused with moderate volatility. This portfolio is made up of 52.5% equities, 32.5% bonds, and a mix of real estate and preferred shares.
- Aggressive ETF Portfolio: For maximum growth and higher volatility. This portfolio is comprised of 62.5% equities, 22.5% bonds, 10% real estate, and 5% preferred shares.
WealthBar (Now CI Direct Investing) will create these portfolios for you with a selection of 8-10 ETFs. Custom portfolio options are also available.
Clients can open any type of account, from the standard RRSP, TFSA, RESP, and non-registered account, to spousal RRSPs, RRIFs, LIRAs, and corporate investment accounts.
Socially conscious clients can add Cleantech to their portfolios. This add-on lets WealthBar (Now CI Direct Investing) investors put 5% of their money into PowerShares PZD, an environmentally progressive fund with a track record for performance. Add the CleanTech option to any of the five portfolio options for even greater diversification.
It uses an interesting collection of exchange-traded funds from industry giants such as Vanguard, iShares, BMO, and Horizons. Below is a screenshot of the holdings inside the WealthBar (Now CI Direct Investing) Balanced ETF Portfolio:
How Does WealthBar (Now CI Direct Investing) Compare?
WealthBar (Now CI Direct Investing) stacks up well against other robo advisor options in terms of pricing and performance and offers some unique features for their clients.
First, let’s talk about the fees. While their fees may be slightly higher than Wealthsimple, they’re still very competitive in the industry – especially when you consider the broader investment options, better access to financial advice, and proven track record of investment returns. Clients also get:
- Easy, straightforward, and completely digital sign-up process
- Access to private investment portfolios for more diversified portfolios
- Financial planning available to all clients
- Retirement income planning available to all clients
- Mobile app with in-app chat functionality and ‘unlimited’ financial advice
- More account types, including RDSPs, RESPs for Quebec residents, and Individual Pension Plans (IPPs)
Second, they’re backed (in spirit now, thanks to the CI Financial acquisition) by Nicola Wealth – a seasoned, esteemed portfolio management company with a 40-year proven track record. It’s through this relationship that investors get access to their exclusive private investment portfolio – or their “all-weather portfolios” as they call them. These all-season portfolios are designed for growth – no matter the market.
The other thing that makes WealthBar (Now CI Direct Investing) really stand out is their excellent financial planning tools. They’ll give clients a detailed overview of their current financial situation and help plan for the future – including retirement income planning. They offer a free professional review of your plan by one of their licensed financial advisors. There is no commitment required for this service. Every WealthBar (Now CI Direct Investing) client also receives regular ongoing reviews with their advisor to help keep their plan on track. That helps WealthBar stand apart from other robo-advisors such as Wealthsimple, who offer financial planning to their higher tiered accounts.
As for their SRI portfolio options, it’s great that WealthBar (Now CI Direct Investing) clients can put 5% of their portfolio into a Cleantech fund with a great track record. However, this falls somewhat short of having a completely dedicated SRI portfolio option like the ones offered at Questwealth, ModernAdvisor, Wealthsimple, and RBC InvestEase.
For a more in-depth comparison, check out our guide to the best robo advisors in Canada.
User Experience: A Peek Inside WealthBar (Now CI Direct Investing)
WealthBar (Now CI Direct Investing) looks sleek and the design of their site definitely appeals to the Millennial generation. Everything from the colour scheme to the design is eye-catching, yet simple to navigate.
The dashboard offers a great user experience, making it easy to get to where you want to go. Setting up the account is a fairly simple process as well. A helpful message pops up while you’re opening the account to see if you need any WealthBar (Now CI Direct Investing) assistance (and a mini-face icon) so you know who you’re talking to.
WealthBar (Now CI Direct Investing) also has a pretty slick mobile app that can be downloaded for iPhone and Android devices. Clients can add funds, track their returns, and get unlimited financial advice through the mobile app.
When you click on your financial plan, you can see personalized information where you can customize your net worth and calculate how much you will have by a certain year depending on the rate of return and savings rate.
*This is just a demo and not reflective of my own financial plan!
Here’s what you need to open a WealthBar (Now CI Direct Investing) account:
- Create an account with your email address and password
- Answer some basic questions about your investment time horizon and risk tolerance
From there WealthBar (Now CI Direct Investing) directs you to its custom portfolio options and highlights a recommendation for you based on your answers. Someone with a long-time horizon and high-risk tolerance will likely get slotted into either the growth or aggressive portfolio. You can see the asset allocation for the growth mix below.
Once you’ve selected your portfolio you continue with the account set-up:
- Fill out an online application, including name, birthday, country of residence, address, employment status, salary, marital status, social insurance number
- Link your bank account
- Fund your account
- Add a digital signature
Once your account is set up, the dashboard looks like this:
Is WealthBar (Now CI Direct Investing) Safe?
Absolutely! WealthBar (Now CI Direct Investing) is a registered Portfolio Manager in every Canadian province and territory. The money that you invest in WealthBar (Now CI Direct Investing) is protected by the Canadian Investor Protection Fund for up to $1,000,000 CAD. The Custodians for WealthBar (Now CI Direct Investing) are BBS Securities Inc., National Bank Correspondent Network, and Credential Securities Inc. These are the institutions that actually hold your assets. You can rest easy knowing your money is safe.
WealthBar (Now CI Direct Investing) is one of the leading robo advisors in Canada. It has everything an investor is looking for in a robo advisor, with custom portfolios made up of low cost, globally diversified ETFs for the conservative to the aggressive investor. Its fees, while altogether slightly higher than other robo advisors, include unlimited financial advice, financial planning, and retirement income planning for every client – adding exceptional value for the cost. To sweeten the pot, Young and Thrifty readers get their first $10,000 managed by WealthBar (Now CI Direct Investing) for FREE for the first year (with a minimum deposit of $1,000). Start investing with WealthBar (Now CI Direct Investing).
WealthBar (Now CI Direct Investing) has a truly impressive wealth management track record of 40 years behind it from Nicola Wealth, which also gives clients access to private investment options not available to the average investor.
The bottom line: WealthBar (Now CI Direct Investing) is a great option not only for new investors looking to get started but also for investors across the spectrum who want access to low-cost, broadly diversified investment options with a proven track record. Their financial planning tools and advice complete the circle of holistic financial advice for its clients.