Investing Retirement

How Does SoFi Automated Investing Work?

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A Guide to SoFI Invest Automated Accounts

If you’re a young or inexperienced trader looking to dip your toes in the water, SoFi Invest is the best micro-trading platform for you. The online-only platform is feature-rich enough to appeal to experienced traders but not so much that newcomers will be overwhelmed. New users should be aware of its many advantages as well as its few disadvantages. SoFi gives its customers a choice between hands-on management of their investment portfolios and hands-off management via algorithmic trading. New account holders who are hesitant to make trades at first may find comfort in the hands-off approach provided by the SoFi Automated Investing system. So how does SoFi Automated Investing work? Read on if you’re interested in finding out more.

How does SoFi Automated Investing work

A young investor who doesn’t have much spare cash will appreciate the fact that the minimum to open a trading account is only one dollar. SoFi Invest Automted provides access to fractional shares and cryptocurrency, and there is no commission for trading ETFs.

SoFi Automated Investing has many advantages, including a low account opening minimum, free access to financial advisors, and no annual fee. There is a trade-off between the level of control you have over your SoFi Automated Investing account and the level of control you have over a self-managed account.

The account holder decides what kind of account to open during the setup process if they decide to pursue an automated investing account. For those who prefer a more hands-off approach to their finances, SoFi also provides IRAs and other types of passive or automated accounts. Choose this option during registration to turn on automated account creation. SoFi walks a new account holder through the process of choosing stocks to add to a portfolio or taking advantage of some of the premade portfolios that SoFi Automated Investing has already built for the novice investor after they’ve answered a few basic questions to determine their risk tolerance. A different set of options will be presented to those who have indicated a preference for lower risk over the long term in order to minimize losses, as opposed to those who have indicated a preference for higher risk, higher returns, and shorter-term losses. To get started, many people take SoFi Invest’s advice and use the suggested portfolio that is specifically designed for them. A financial advisor is available for those who need answers.


The automated SoFi Invest account is ideal for the first-time user, especially the young account holder who is eager to get started but isn’t yet confident in their investment acumen. The best way to start investing is with an automated account when you’re young, so you have plenty of time to learn the ropes. While you focus on other things, SoFi’s algorithmic decision-making process is constantly optimizing your portfolio. When the account holder is ready to take a more hands-on approach to trading, they can upgrade to a managed account that gives them more freedom and responsibility. If you have asked yourself “how does SoFi Automated Investing work?” hopefully this guide has helped give an answer.


1. How does SoFi Automated Investing work with tax-loss harvesting?

SoFi Automated Investing does not currently support this functionality.

2. How does SoFi Automated Investing work with automated rebalancing?

SoFi compares your portfolio’s actual allocation to the target allocation at regular intervals and rebalances it as closely as possible whenever there is a change in the account’s balance (such as a withdrawal or deposit). In addition, the advisor will check your portfolio on a daily basis to see if it has deviated by more than 5 percentage points from the target and make the necessary adjustments to bring it back in line with the target.

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Editorial Disclaimer: The editorial content on this page is not provided by any of the companies mentioned and has not been endorsed by any of these entities. Opinions expressed here are author's alone

The content of this website is for informational purposes only and does not represent investment advice, or an offer or solicitation to buy or sell any security, investment, or product. Investors are encouraged to do their own due diligence, and, if necessary, consult professional advising before making any investment decisions. Investing involves a high degree of risk, and financial losses may occur.

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