Launched in 2011 as the U.K.’s first online discretionary investment management firm, Nutmeg offers a simple fee structure through either a fixed allocation portfolio or a managed portfolio.
- Passive investors
- Cost-conscious investors
- Investor willing to take on a decent amount of risk
- Low fees relative to other robo advisors as well as full-service brokerages
- Simple fee structure
- Quick portfolio set up time
- Minimum investment requirement is relatively high; especially with a ISA (£500 minimum investment amount is required and a minimum of £100 should be deposited each month until £5,000 is reached)
- The pension account requires a minimum investment of £5,000
- Poor breadth of tradable assets
- Research provided is very basic and no third-party research is available
Who Uses Nutmeg?
Nutmeg may be the best bet for beginners, those who prefer passive investing and cost-conscious investors.
Beginners and passive investors: If you’re a new investor, Nutmeg offers a hand-holding option as a robo advisor. Additionally, passive investors may prefer a laid-back approach and will invariably look for a credible investment advisory service that can fetch decent returns with low levels of risk.
Cost-conscious investors: Nutmeg’s low, straightforward and simple fee structure appeals to cost-conscious investors.
What Nutmeg Offers
The firm allows limited options in terms of tradable asset classes.
The globally-diversified portfolios constructed by the firm’s investment team comprise a mix of exchange traded funds (ETFs). The team chooses from a universe of 1,800 ETFs, with preference for physical ETFs with high liquidity and good tracking performance.
The ETFs track developed equities, emerging market equities, developed market government bonds, emerging market bonds, corporate bonds and commodities.
Nutmeg offers stocks and shares of ISAs, which are tax-free, and lifetime ISA, which is a saving made toward purchase of a first home or retirement. A government bonus is added to the contribution until 50 years of age.
Unfortunately, Nutmeg is unable to offer services for individuals who reside outside of the United Kingdom.
Nutmeg Commissions and Fees
The fees are chargeable on a monthly basis and calculated based on the annual rates. Fees due will be deducted from your Nutmeg account.
There is no setup or exit fee, although a £20 fee is charged if a transfer out is required. The firm also claims to charge £0 in transaction fees and trading fees.
Additional investment costs include an average fund cost of 0.21% per annum, due to the fund provider and an average effect of market spread of 0.09% per annum.
Nutmeg Platform and Tools
Since Nutmeg doesn't allow self-directed investment, the company does not offer a desktop or mobile trading platform. However, you can access your account 24/7 online through an app. The app is also available for both iOS and Android, but these have fewer functions than what is offered on the site.
You can view performance and correspond with your investment manager and make deposits and/or withdrawals. The online platform doesn’t provide charting or fundamental analytical tool.
Research
Content by way of research is very limited. The firm’s website has a blog titled Nutmegonomics, which carries articles that explain the complex world of investing and finance under the head “Investing” and “Nutmeg Investor Update,” which is a monthly article.
Security
Nutmeg will protect your personal data by TLS encryption.
Nutmeg uses a two-step verification (two forms of identification) for logging into an account. This verification requires your login credentials and a unique passcode generated by a two-factor authentication app on your mobile.
Nutmeg is available only for U.K. residents, although non-U.K. residents who are British passport holders and hold a U.K. bank account and reside in select few countries could also open an account with Nutmeg.
If the firm defaults, investments up to £50,000 are guaranteed, as Nutmeg participates in the U.K. Financial Services Commission Scheme, which covers invested funds and cash deposits.
Nutmeg Customer Support
Phone support at 020 35981515 is available from Monday through Friday between 9 a.m. and 5:30 p.m., with a small dedicated customer support team based in London. Live chat option is also available from Monday through Friday between 9 a.m. and 5:30 p.m.
For account-related questions, the brokerage can be contacted using the email address support@nutmeg.com. Complaints can be raised using the email address complaints@nutmeg.com.
If you require face-to-face interaction, Nutmeg will allow you to book an appointment (0203 598 1515) and meet one-on-one with an investment advisor.
Nutmeg & Its Ease of Use
A Nutmeg portfolio can be set up in about 10 minutes. First, you’ll choose the account type, which can be an ISA, pension or general investment. Next, you may have to choose your investment goal (home purchase, child’s education, big spend, retirement, etc.)
You’ll be able to choose the amount you’re willing to commit each month and the amount of risk you’re willing to assume.
The firm solicits some personal information such national insurance number (if the account is an insurance account) and bank details. Payment for opening an account can be made online.
Final Thoughts on Nutmeg
This robo advisor offers good customer support, although the relatively high minimum account balance could serve as a deterrent. All said and done, Nutmeg’s simplicity makes it worth investigating.
Frequently Asked Questions
Can I use Nutmeg In the US?
Unfortunately, due to US tax regulations Nutmeg is unable to offer services for individuals who reside In the US.
How much money do I need to start investing with Nutmeg?
In order to open a General ISA with Nutmeg. the minimum investment is £500. In order to open a lifetime ISA (LISA) with Nutmeg, the minimum investment is £100.
What is a LISA?
LISA stands for Lifetime Individual Savings Account. In order to open a LISA you must be a resident of the UK. You cannot access the money put into a LISA for 12 months. They’re designed to help those ages 18-39 save for retirement or buy their first home.