Banking, Finance, Personal

Neo Financial Invest Review For 2023

Neo Financial is the top online bank in Canada that provides a range of competitive financial offerings. 

The bank is revolutionizing various aspects of the Canadian financial landscape despite its recent entry in 2020.

They have expanded their services beyond traditional banking, encompassing savings, credit cards, mortgages, and even investment options.

In early 2022, Neo Financial introduced a goal-oriented private wealth management platform called Neo Invest. 

This platform is designed to assist Canadians in accomplishing their financial goals through automated investing.

In this Neo Invest review, I will provide a comprehensive analysis of this innovative robo-advisor, exploring its features and comparing it with other leading robo-advisors in Canada.

Overview of Neo Invest

The following is an overview of Neo Invest’s key features.

NameNeo Invest 
Year founded 2022
Investment platformRobo-advisor 
ProviderNeo Financial 
Portfolio ManagerOneVest
Portfolio management strategy Active
PortfoliosThemed Portfolios
Investment accounts Personal, TFSA, and RRSP accounts
Minimum investment $1
Management fee0.75%
MER0.4% to 0.5%
Returns since inception N/A

Let’s get into the details of the Neo Invest review.

What is Neo Invest?

Neo Invest is Neo Financial’s actively managed robo-advisor that was launched in April 2022. 

Neo Invest leverages the expertise of OneVest Management Inc., a leading Portfolio Manager in Canada, ensuring a high level of security similar to other robo-advisors in the country.

The primary objective of Neo Invest is to assist Canadians in growing their wealth by actively managing globally diversified ETF portfolios.

Before signing up, it is important to assess Neo Invest’s unique features and a competitive edge when compared to the existing robo-advisors in the market. 

By analyzing its offerings, performance, and overall user experience, you can gain a comprehensive understanding of what Neo Invest brings to the table and how it stacks up against its counterparts.

How Neo Invest Works

Neo Invest operates similarly to other robo-advisors available in the market. 

By considering factors such as your investment goal, risk tolerance, time horizon, and financial situation, Neo Invest will help you find the ideal portfolio that aligns with your needs.

Once you provide the necessary information, the robo-advisor will analyze your profile and recommend one of its diversified ETF portfolios. 

If you find the recommendation suitable, you can start by funding your account with a minimum amount of just $1. 

This can be done through an existing investment account or a bank transfer. At this point, your responsibility ends.

Neo Invest will then take charge of investing your funds into a globally diversified ETF portfolio. The portfolio will be actively managed and periodically rebalanced based on thorough research conducted by professionals who monitor the current market conditions.

You will have the freedom to monitor the performance of your portfolio and make adjustments as needed, providing you with transparency and control over your investments.

Is Neo Invest Safe?

Neo Invest ensures the safety and security of your investments, aligning with the standards set by other robo-advisors in Canada. 

This is made possible by its collaboration with OneVest Management Inc., a registered Portfolio Manager and Fund Manager.

Furthermore, the custody of your assets on Neo Invest is entrusted to CI Investment Services (CIIS), which operates under the regulation of the Investment Industry Regulatory Organization of Canada (IIROC). 

Additionally, CIIS is a member of the Canadian Investor Protection Fund (CIPF), which provides coverage for your assets up to $1 million.

Rest assured, your personal information is handled with utmost care by Neo Financial. They employ industry-level protocols to ensure the privacy and security of your sensitive data.

Neo Invest Portfolios

Neo Invest portfolios are called Themed Portfolios. 

They are value-investing vehicles that allow you to balance traditional and alternative investment approaches in a single portfolio based on your:

  • Risk tolerance
  • Investment goals
  • Investments timeline

The portfolio not only provides diversified returns but also helps fight climate change by investing in environmentally-friendly funds. 

Neo Invest aims to enhance diversification and potentially increase returns through its unique investment approach. 

It achieves this by investing in 11 different innovative sectors and providing access to advanced innovative investment products that can yield up to 3X returns.

These innovative investment products are reflected in globally diversified ETF portfolios, which encompass a range of alternative and digital asset classes. 

Neo Invest Accounts

Neo Invest offers three types of investment accounts for investors, namely:

Compared to other robo-advisors in Canada, Neo Invest has a smaller selection of investment accounts. 

However, if the available account options align with your needs and preferences, you have nothing to worry about. 

When setting up your Neo Invest account, you have the convenience of transferring either a portion or the entirety of your funds from an existing RRSP or TFSA account into your portfolio. Click here to learn how to do so

Neo Invest Fees

Neo Invest, like other robo-advisors, has a fee structure that includes a management fee and a management expense ratio (MER). The specific details of these fees are as follows:

  • Management fee: 0.75%
  • MER: Ranging from 0.4% to 0.5%

It is worth noting that when compared to other robo-advisors in the industry, Neo Invest’s management fee and MER are relatively higher. 

This means that investors will incur a greater cost for utilizing Neo Invest’s services.

However, it is important to look beyond fees when choosing the best robo-advisor. 

While Neo Invest may have higher fees, it’s essential to assess the overall value and benefits provided by the platform about the cost.

Neo Invest Advantages and Disadvantages  

As a new robo-advisor, Neo Invest has limited data for critical judgment. But based on the available data, we can identify the following advantages and disadvantages. 

Advantages of Neo Invest 

  • No minimum investment: You can start investing with as little as $1, making Neo Invest a great option for investors who are just getting started.
  • Automated deposits: Neo Invest simplifies your financial life by allowing you to automate weekly or monthly deposits. This feature enables you to focus on other important aspects of your life while ensuring consistent contributions to your investment portfolio.
  • Customized portfolios: Whether you’re saving for your child’s education, planning for a car purchase, managing your mortgage, or preparing for retirement, this goal-oriented robo-advisor assists you in achieving your financial objectives. By aligning your investments with your specific goals, Neo Invest provides a personalized approach to help you reach your desired milestones.

Disadvantages of Neo Invest 

  • Limited account options: Neo Invest currently offers a limited selection of three investment accounts, which may not meet the diverse needs of all investors.
  • High fees: Neo Invest, being a relatively new addition to the landscape of robo-advisors in Canada, has higher management fees and MER compared to its counterparts, potentially increasing the overall costs for users.
  • Limited historical data: One factor that sets Neo Invest apart from other robo-advisors is the absence of available historical data regarding asset allocations and returns. This lack of information poses a relatively higher level of risk for potential investors who rely on historical performance as a key factor in their decision-making process.

Is Neo Invest Right For You?

Neo Invest is particularly well-suited for investors who are just getting started or who want to automate their investment process with an active approach.

However, Neo Invest is not without its drawbacks. The platform does not offer as many features as some of its competitors, and it does not have a mobile app. 

Given the limited information and considerations mentioned, investing in Neo Invest at this stage could indeed involve a certain level of risk and potential gains. 

The robo-advisor is relatively new, making it challenging to assess its performance compared to other established robo-advisors in Canada.

Overall, you can’t go wrong with Neo Invest. However, it’s important to weigh the pros and cons before deciding if it is the right platform for you.

Conducting further research and seeking advice from a financial advisor may be beneficial in making an informed decision.

How to Open a Neo Invest Account

You have the convenience of opening a Neo Invest account through the Neo app, which takes around 10 minutes or less. 

However, certain requirements must be met, as outlined below:

  • Reside in any Canadian province or territory, except Québec.
  • Attain the age of majority in your province or territory
  • Possess a Social Insurance Number 
  • Have a mobile number

If you are an existing Neo client you can easily apply online by logging into your Neo account. Simply follow these steps:

  • Click on the “Investments” tab.
  • Press “Start Investing.”
  • Follow the prompts to complete your application.

But if you’re not currently a Neo client, the following steps should be followed to open a Neo Invest account:

  • Go to the application page
  • Click on the “Get Started” button
  • Enter your email address.
  • Create a password
  • Confirm your password
  • Click on the “Continue” button
  • Enter your mobile number for account verification 

There you have it!

Alternatives For Neo Invest  

Canada is blessed with several robo-advisors. The coming of Neo Invest is just an addition. But how does this addition compare with the existing robo-advisors?  

No doubt, Neo Invest outshines some robo-advisors, but it falls behind others in terms of overall performance and features. 

Here is an overview of some of the leading robo-advisors in Canada that are ahead of Neo Invest.

Wealthsimple Invest 

Year founded 2014
PortfoliosETF, SRI, and Halal
Portfolio management strategy Passive
Investment accounts Personal, business, RRSP, RRIF, TFSA, RESP, and LIRA accounts
Minimum investment $1
Management fee0.4% – 0.5% 
ETF MER 0.13% – 0.16% 

Founded in 2014, Wealthsimple Invest has a significant advantage over Neo Invest. Unlike Neo Invest, Wealthsimple Invest follows a passive investment approach in managing portfolios.

Wealthsimple Invest offers a diverse range of portfolios and investment account options, boasts lower fees, and has no minimum investment requirement.

If you are seeking an alternative to Neo Invest that follows a passive investment strategy, 

Wealthsimple Invest is the ideal choice. It stands several steps ahead of Neo Invest in terms of overall performance and features.

To gain further insights into Wealthsimple Invest, I recommend reading our comprehensive review of the Wealthsimple robo-advisor.

Learn more about Wealthismple:

Questwealth Portfolios

Year founded 2014
PortfoliosETF and SRI
Investment accounts Personal, corporate, TFSA, RRSP, RRIF, RESP, LIRA, and LIF accounts
Portfolio management strategy Active 
Minimum balance $1,000
Management fee0.20% – 0.25% 
ETF MER0.17% – 0.22% 

Questwealth Portfolios, offered by Questrade, stands as one of the top robo-advisors in Canada. Similar to Neo Invest, Questwealth actively managed portfolios. 

The platform has been serving investors for over eight years, initially under the name Portfolio IQ in 2014 and later rebranded as Questwealth in 2018.

Questwealth offers multiple investment account options and boasts a low management fee and MER, outshining Neo Invest.

Overall, Questwealth presents itself as the top alternative to Neo Invest for active robo-advising in Canada.

To delve deeper into Questwealth, I recommend exploring our comprehensive review of Questwealth Portfolios. 

Learn more about Questrade:

Verdict on Neo Invest Review

Neo Invest is a relatively new player in the Canadian robo-advisory industry, offering goal-oriented investment solutions. 

While it offers access to goal-oriented managed investing with no minimum investment requirement, there are so many drawbacks you need to bear in mind.

Neo Invest currently supports a limited number of investment accounts, which may not meet your needs. 

The robo-advisor also has a relatively higher management fee and MER compared to some competitors in the market. 

Furthermore, the lack of historical data on asset allocations and returns poses a higher risk for potential investors.

Bearing all these in mind, investing in Neo Invest entails a certain level of risk versus potential gains. 

As such, it’s crucial to carefully evaluate your own investment goals, risk tolerance, and preferences before deciding if Neo Invest aligns with your needs.Read Also: Neo Financial Secured Credit Card Review

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About John Adebisi

John Adebisi is a CPA, FCCA and MBA holder with a Bachelor's degree in Accounting & Finance. He has over a decade of experience in writing personal and business finance content for audiences across North America, Europe, the UK and Africa. In addition to his writing experience, he also has a strong background in financial research and analysis, giving him a unique perspective of the financial markets. John derives pleasure in helping people make smart financial decisions, and he believes that knowledge and experience can be valuable resources for anyone who wants to learn how to manage their money.

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