Smart Portfolios: everything you need to know

You might have heard of eToro’s ready-made diversified investment bundles, but are not sure how they work or why you should consider investing in them. Let’s take a closer look learn more about what Smart Portfolios are and if they are right for you!

What are Smart Portfolios?

First, let’s clarify what these unique investment products are exactly. 

Smart Portfolios, simply put, are a number of assets (and even varying asset classes) united together by a specific theme. This theme could be based on a growing market trend, such as clean energy or gaming; a new technology, such as semiconductors, Decentralised Finance (DeFi) or the metaverse; assets from a specific region, such as Europe or China; as well as more traditional industries such as healthcare, banking or oil

This is known as thematic investing, bundling together assets in a way that is similar to how many exchange-traded funds (ETFs) work. Smart Portfolios also utilise what is known as dynamic asset allocation, which combines active and passive approaches to offer the best of both. And unlike ETFs, whose allocation is dependent on a particular index, Smart Portfolios can adapt to changing market conditions.

With over 70 Smart Portfolios available on the platform and more being added all the time, there are many themes to choose from and something for everyone!

Long-term vision

The creation of each Smart Portfolio is strategic and based on the most advanced data. eToro’s investment experts have done the research, analysis, and allocation to create a variety of ready-made, balanced and diversified portfolios for our clients, specifically designed for optimal long-term performance. 

Our team of analysts is constantly on the lookout for the most impactful trends and growing markets that are projected to make a major impact in the coming years. These are the industries and technologies that we believe have staying power beyond the buzzwords and are worth considering for long-term investors who have their eye on the future. 

Why take a long-term investing approach to developing trends? Because they take time to mature and appreciate in value. For example, electric vehicle stocks are popular investments, but the industry is only getting started. Right now there are a small number of electric vehicles on the road; however, analysts predict that by 2050, most cars in use will be electric. When you begin investing in a trend early and stay with it over time, you’re more likely to see excellent returns.

Diversification is key

Every Smart Portfolio is tailored according to a distinct investment strategy, with its assets weighted according to specific metrics, including market cap, revenues, R&D expenditure, and more. Its theme is thoroughly researched, including who the market leaders are, their performance and growth projection, as well as any corollary assets which operate within the same theme. 

A well-diversified portfolio is one of the best risk management strategies out there. Although the assets have a theme in common, they can span varied sub-sectors, regions, and even different asset classes. For example, eToro’s TravelKit Smart Portfolio includes companies from all aspects of travel, ranging from the more obvious airlines, hotels and attractions to related sectors such as online booking companies, apps that travellers tend to rely on, and luggage manufacturers. TravelKit offers a truly comprehensive thematic investment opportunity along with diversified exposure to the travel industry, a strategy that tends to lower risk. 

Something for everyone

Choose the type of Smart Portfolio (or more than one!) that fits your investment strategy:

  • Thematic: Gain diversified and balanced exposure to leading sectors and growing industries with a wide range of themes to choose from ranging from the traditional to the disruptive. Check out: RenewableEnergy | Utilities | BatteryTech | InTheGame | MetaverseLife
  • Regional: Invest in expertly researched portfolios based on a specific region with projected growth and global impact. Check out: AussieEconomy | EuropeEconomy | NordicEconomy
  • People & Partner: eToro leverages billions of metrics generated by millions of users as well as collaborates with some of the most innovative investment managers and data research companies. Check out: SharpTraders | WarrenBuffet-CF | OutSmartNSDQ
  • Crypto: A number of studies have found that moderate allocation can be beneficial from a risk/return perspective. With cryptoassets still in their early stages and prone to volatility, the most sensible approach is to start small and diversify. Check out: BitcoinWorldWide | CryptoEqual | DeFiPortfolio

Crypto is highly volatile & unregulated. No protection. Tax may apply.

 

Smart Portfolio themes span a range of top markets, trends, and industries. You’ll find them offered in a wide variety of categories, including utilities, travel and leisure, life sciences, technology, financials and payments, food and beverage, and more! 

Start investing smarter

Bundling together several assets under the same strategy and employing a dynamic investment approach, eToro Smart Portfolios are long-term investment solutions that offer diversified exposure with no management fees and no hidden charges. We want these innovative products to be accessible to any level of investor that’s why we’ve priced them starting at only $500 for the initial investment. Check out the full range today!

Explore Smart Portfolios

 

 

Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Cryptoassets are highly volatile and unregulated in the UK. No consumer protection. Tax on profits may apply.