by CI Staff
Jemstep is a free online portfolio guidance and management system designed for individual investors. According to Jemstep, the website uses technology to provide objective, transparent ratings for more than 20,000 mutual funds and exchange-traded funds ETFs. Jemstep takes into account your objectives, goals and risk tolerance and identifies recommended investment options. In addition, Jemstep is able to track your holdings.
The first step to starting to use the website is to create an account. Jemstep works by allowing users to create individual goals. There are four types of goals from which to choose—retirement, college savings, large purchase and wealth building. If you choose retirement, the website asks for several inputs on the first screen, including birthday, gender, retirement age, and the age you expect to live to. In addition, users need to specify risk tolerance.
Print this article
Share this article
After creating your goal and answering simple personal questions, Jemstep asks you for your risk and return profile. There are two options for building your risk and return profile—basic and advanced. If you choose basic, Jemstep will simply ask you to answer two questions, one regarding financial security and one regarding past performance. Choosing advanced will prompt Jemstep to ask six questions regarding volatility, risk-adjusted returns, total returns, historic gains, historic losses and data period for ranking.
When you have finished creating a goal, it will appear on your dashboard. At this point, you will have several choices as to how to proceed. You may link your accounts directly with the website. Jemstep will then rank each of your holdings according to your risk and return profile. Conversely, you may choose to “Rank Funds.” This option allows you to enter in a specific fund you wish to rank. Jemstep will identify a similar fund and compare the two, presenting you with a summary, details and a performance comparison. The summary shows a basic return chart, along with its current price and Jemscore (out of 100). The details page outlines the fund’s investment style, yield, worst three-month performance, and three-year return. The performance table lists three-month through 10-year performance.
Finally, if you linked your brokerage or retirement accounts, Jemstep can also track your portfolio. The portfolio tracker shows your performance against various benchmarks for a set period of time.
Jemstep provides guidance for your investments free of charge. Unfortunately, the website only rates mutual funds and ETFs. In addition, if you want to maximize the website’s ability, you need to link your brokerage and/or retirement accounts with the website. Even though the website states that it uses bank-level security, having extra passwords and bank account numbers saved on the cloud is never 100% safe.