Wealthfront Launches Automated Bond Portfolio


Wealthfront, a fintech wealth management and robo-advisor firm, announced an automated bond portfolio that allows customers to invest across a spectrum of bonds ETFs.

Key Takeaways

  • Wealthfront launched an automated bond portfolio.
  • The product features a 5.48% yield, higher than many other fixed-income options.
  • Accounts are 100% managed, with rebalancing, dividend reinvestment, and tax-loss harvesting.

The Palo Alto, California company’s Automated Bond Portfolio features a 5.48% yield net of fees, using a diversified mix of Treasury and corporate bond ETFs that would typically carry less risk than stock portfolios.

In a rising rate environment, a product like this could provide more liquidity compared to other popular fixed-income instruments such as CDs and Treasurys.

The Automated Bond Portfolio is 100% managed and adjusted to rebalance, reinvest dividends, and even add cost savings with tax-loss harvesting. A 0.25% annual management fee is applied, just like its Automated Index Investing account, which puts client money into a balanced mix of sectors, based on a risk score, such as U.S. stocks, emerging markets, and real estate.

Higher interest rates and stock market volatility have driven a rise in investor interest in fixed-income investments such as money market funds. And Wealthfront clients are no different. The company said there was a 130% increase in client fixed-income purchases in Q1 2023, compared to the prior quarter.

Other products are also vying for investor attention as they make their rates more competitive. For example, Robinhood (HOOD) recently raised rates for its Gold Cash Sweep account in May.