Acorns Essay

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Acorns Acorns allows users to invest with just their spare change. It is a smartphone application that allows users to round up purchases from their debit/credit card and automatically invests the leftover change into a possible 5 different portfolios. Users of the app can even target one of the five portfolios, whose risks can range from conservative to aggressive. By choosing a more aggressive setting you end up putting more money in stocks however you will always have some money in each fund which allows the user to continue being diversified among a range of large and small company stocks, real estate, emerging markets and finally government and corporate bonds. To use Acorns it costs $1 a month plus a commission ranging from 25% to 50% of their subsequent earnings. Users can also withdraw their funds at any time. So why is Acorns an attractive investment opportunity? A third of Acorns users are under 22 which is why they are purposely targeting what has been described as “Millennials” (Time.com). Pretty …show more content…

For example Acorns according to crunchbase.com is advised by Noble Laureate Dr. Harry Markovitz who is perhaps best known for devising the modern portfolio theory in 1952 something which “emphasized the importance of portfolios, risk, the correlations between securities and diversification”. This can only enhance the overall status and general reputability of the application. In terms of potential earnings, Cruttenden has described through beta testing with the app during the summer how in general accounts have an expected return of anything between 4% to 9% which all of course depend on the chosen risk factor (latimes.com). Cruttenden says he is a typical user of the app and through rounding up his purchases on his debit card has added $521.63 to his account over three months during the summer

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