Ladies, it’s time for a new name in the ranks of “reviews of banks and brokers where you can invest. In this article, we are going to talk about InDelta, until recently an unknown name to us in the world of index investing, but after some research we feel that this party also deserves a review on the ELFIN platform. Read on quickly for the entire review index investing at InDelta.
Please note that investing involves risk. Invest only with money you can spare. Want to learn about investing before you actually get started? As an ELFIN member, you get access to the Beginning with Investing e-course that teaches you all the basics.
Index investing at InDelta, say what?
InDelta is a fund provider where you can invest simply and passively in index funds through a proprietary distribution or model portfolio. It makes investing simple and approachable. You can start investing at InDelta from as little as one euro. At InDelta, you invest in equally diversified funds. Each fund consists of 50 companies, all weighing 2%. There are nine unique funds to choose from, this way you can build a well-diversified portfolio. And we know by now: diversification is key when it comes to long-term successful investing, because by properly diversifying, you reduce your risk as an investor.
Read all about spreading your investmentshere.
Enthusiastic? Check out more information about index investing at InDelta here!
The cost of index investing at InDelta
Anyway, we know diversification is important, but just as important for long-term successful investing is keeping your costs as low as possible. After all, costs can weigh on your bottom line. What about the cost of index investing at InDelta?
In total, at InDelta, you have 0.57% annual fees on your invested assets. The 0.57% consists of fund management fees of 0.5% per year and other fund fees of 0.07% per year. These are costs they incur to implement investment policies (such as annual reweighting) and to prevent dividend leakage. By the way, read here what dividend leakage is, well good to understand. Costs are factored into the price of the index funds. In addition to these fees, there are no buying and selling fees, no service fee or custody fee and changing your portfolio is free. Opening and maintaining an account is also completely free.
A word about those index funds…
InDelta itself has put together 9 funds that, as they say themselves, “represent the entire investment universe. So what they don’t do is fully track an index. They developed 1 themselves. If you make a 1-to-1 copy of an index, it is often said that this allows you to automatically follow the market, but InDelta has a somewhat different view. What they themselves say on this, on these self-assembled funds, is the following:
“The traditional stock market indices such as the Dow Jones Index or AEX Index are simply not well diversified. These indices are constructed based on market capitalization. This means that the company with the highest market capitalization gets the largest percentage weighting. As a result, you are unnecessarily dependent on only a few companies or sectors. Did you know that Royal Dutch Shell makes up 15% of the AEX? And Dow Jones is 20% made up of technology companies?”
Okay, makes sense. So they put it together themselves every year, but isn’t there a risk in that too? So far, the funds appear to be performing well, with positive returns. Every November, they analyze and adjust the fund.
Investing at InDelta
We think InDelta can be a good fit if you want to invest passively for the long term. By passive we mean: you open an account, you sign up, fill out the W8-ben form – don’t be alarmed, this is normal, partly because of this W8-ben form, you’ll soon have to pay less dividend tax – and then you can get to work putting together your portfolio.
You can choose to invest in accordance with model portfolios. Here you have three choices: offensive, neutral, defensive. This says something about the risk you are willing to take. You can also click one of these model portfolios and then make changes to it, this way you can manually deviate slightly from the chosen model.
Easy peasy
That’s it. Oh yeah, and deposit money. Quite a major detail! Via iDeal you easily transfer money which InDelta invests immediately for you. You can then set up a direct debit to invest automatically each month. The money is then transferred and InDelta does the rest for you. This is something we favor, because then investing becomes a regular part of your monthly money routine.
Conclusion index investing at InDelta
We think InDelta could be a consideration if you want to invest successfully for the long term. Through InDelta, you invest widely, at low cost, and with great convenience. Index investing at InDelta can be compared to investing at Brand New Day or Peaks. Of course, the parties differ (costs, funds) but the principle is the same. The advantage of InDelta in particular is its low costs, which are lower than, for example, Brand New Day. This way of investing – index investing – is a very good way to build long-term wealth.
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