When investing, your capital is at risk and you may get back less than invested. Past performance doesn’t guarantee future results.
Automated investing with Trading 212 Pies
Automation has helped simplify our lives. That’s why many investors are turning to automated investing apps. Pies & AutoInvest is a feature on the Trading 212 app - and a lot more.
Big ideas
- Using an investing app can save you time and money
- Pies on the Trading 212 app are an accessible way to copy or design your own diversified stock portfolio
- AutoInvest will buy more shares of the stocks you have in your pies at regular intervals automatically
How to do automated investing
If automation can benefit us in our everyday lives, why not use it to try to help manage our money and invest?
Automated investing apps have already become hugely popular - and for two obvious reasons - it saves time and it works! Nearly everybody can benefit from paying closer attention to investing but that doesn’t mean it’s easy.
Three of the most common obstacles that hold people back from more successful investing are:
Automated investing apps have already become hugely popular - and for two obvious reasons - it saves time and it works! Nearly everybody can benefit from paying closer attention to investing but that doesn’t mean it’s easy.
Three of the most common obstacles that hold people back from more successful investing are:
- Tracking your investments
- Staying diversified
- Being consistent over time
Adding some automation to your investing solves these three issues and a few more.
Watch our video
What are Trading 212 Pies?
Pies on the Trading 212 platform are an easy way to design and grow a properly diversified portfolio for the long term. It’s pretty obvious why they’re called Pies when you see one of them. They look like a pie!
The portfolio is the whole pie and each different investment, be it a stock or an ETF is a slice of that pie. You can almost think of them as DIY ETFs.
There are two ways to create a pie.
There are two ways to create a pie.
- You choose the slices by picking the stocks you personally like
- You choose one of the pies created by other investors in the Trading 212 community.
Creating your own Pie
The process for creating your won pie in the Trading 212 app is as follows.
STEP 1: Tap the pie icon. Here it will list all your pies - whether you made them yourself or copied one.
STEP 2: Pressing the plus button takes you to where you can select the stocks and/or ETFs that you want to be a part of your pie
You can choose from lists of stocks, ETFs or Watchlists. For creating a pie of dividend stocks in Trading 212, a good start is to use the ‘Dividend’ list under stocks.
STEP 3: When you are happy with your selection, continue by selecting the arrow button.
STEP 3: When you are happy with your selection, continue by selecting the arrow button.
At this point in the process, you can see a preview of what your pie will look like. The default is to weight each stock equally within the pie. I.e. you will buy the same amount of each stock.
STEP 4: By adjusting the sliders on each stock, you can adjust the weight up and down. It shows under the main pie on the right the total tally of all your weightings - so you want this to end up as 100%. The ‘Next’ button won’t be tappable until the portfolio is adjusted to 100%.
STEP 5: On the next page, if you choose ‘Manually’ it means you invest into this pie using the funds already in your investing account. We will cover ‘Autoinvest’ shortly.
STEP 6: The last thing that you need to do is pick a name, and an icon if you want to differentiate this pie from the others you will create.
STEP 7: You can tap ‘create pie’.
STEP 5: On the next page, if you choose ‘Manually’ it means you invest into this pie using the funds already in your investing account. We will cover ‘Autoinvest’ shortly.
STEP 6: The last thing that you need to do is pick a name, and an icon if you want to differentiate this pie from the others you will create.
STEP 7: You can tap ‘create pie’.
Copying a pie
Now, let’s go back to our Pies page again,
STEP 1: This time choose option two, copying a pie.
STEP 2: Tap ‘Open a pie library’ - then the next page gives a visual summary of the various pies that have been created in order of popularity and handily categorised along the top.
NOTE: Before you choose a pie to copy you can see how many people have also invested in it - what we at Trading 212 call ‘Pie copiers’ - and read through their comments and feedback - and of course review what is in the pie as well as the description of it written by the investor who made it.
STEP 1: This time choose option two, copying a pie.
STEP 2: Tap ‘Open a pie library’ - then the next page gives a visual summary of the various pies that have been created in order of popularity and handily categorised along the top.
NOTE: Before you choose a pie to copy you can see how many people have also invested in it - what we at Trading 212 call ‘Pie copiers’ - and read through their comments and feedback - and of course review what is in the pie as well as the description of it written by the investor who made it.
STEP 3: When you are ready tap ‘copy pie’
STEP 4: Tap Next. You still have the option to move the weightings but in most cases, investors tend to go with what’s been suggested.
STEP 5: Choose How to Invest either manually or with Autoinvest.
Why use Pies?
Copying Pies offer a solution for ‘deciding what to invest in’ because the creators of the pies are showing you some ideas for you to copy or borrow from.
Visualising your individual investments as slices within a bigger pie that is your portfolio can encourage diversification. You can see what you own, and if you like - you can group the different types of investments you’ve made - ie what makes your portfolio diversified - into pies. Hence pies help in ‘staying diversified’.
Diversification is so important for investing because it means you’re spreading the risk of each individual investment into a group of investments.
Visualising your individual investments as slices within a bigger pie that is your portfolio can encourage diversification. You can see what you own, and if you like - you can group the different types of investments you’ve made - ie what makes your portfolio diversified - into pies. Hence pies help in ‘staying diversified’.
Diversification is so important for investing because it means you’re spreading the risk of each individual investment into a group of investments.
What is Autoinvest?
You can use the Trading 212 AutoInvest feature to automatically make regular deposits to your pie.
Autoinvest doesn’t just automatically deposit money into your account, like a standing order with your bank - it makes contributions directly into your Pies.
Autoinvest doesn’t just automatically deposit money into your account, like a standing order with your bank - it makes contributions directly into your Pies.
The algorithm will split your deposit into the correct amounts depending on the allocation of your pie. The result is that Autoinvest will buy the shares you have in your pies at regular intervals automatically.
It is automation but the power still rests with you as the investor. You can customise your deposit schedule to suit your salary/income.
It is automation but the power still rests with you as the investor. You can customise your deposit schedule to suit your salary/income.
How to setup Autoinvest
The Autoinvest feature goes hand-in-hand with Pies.
Let’s go back to where we last left the app.
STEP 6: This time select ‘Autoinvest’
Let’s go back to where we last left the app.
STEP 6: This time select ‘Autoinvest’
The app gives you a ‘value projection’ of what your pie could be worth in the future. The projection is based on some assumptions and cannot predict the future. It’s worth tapping the ‘i’ icon next to the value projection to understand better how it's calculated.
Disclaimer: Past performance is not indicative of future performance.
Disclaimer: Past performance is not indicative of future performance.
STEP 7: Once you’re happy with how much you will be investing automatically each month, you select next.
STEP 8: Go ahead and ‘Fund pie’.
Word of caution: There is always a risk when investing, even with the most diversified, well-engineered Pie, you should still not invest more than you can afford to lose. You still need to take responsibility for your investments, even if you are leaving the calculations and complex balancing to the Trading212 platform.
STEP 8: Go ahead and ‘Fund pie’.
Word of caution: There is always a risk when investing, even with the most diversified, well-engineered Pie, you should still not invest more than you can afford to lose. You still need to take responsibility for your investments, even if you are leaving the calculations and complex balancing to the Trading212 platform.
Portfolio rebalancing
So far we have covered automating the initial investment into Pies, and then automating the reoccurring deposits. The final thing we can automate is the rebalancing of our portfolio.
If a stock is performing well, that’s a good thing, but it throws off the balance of your portfolio. This is because the portfolio becomes too reliant on the success of one company, and if something bad were to happen, the portfolio will be over-exposed to the failure of that company.
To keep the balance of your portfolio (ie the weighting of the investments the same) it’s necessary every so often to rebalance it by buying and selling the shares back to their original weightings.
Doing the calculations yourself for how much of each stock you should buy and sell, and then paying a commission on each transaction has traditionally made rebalancing a painful process.
Thankfully things have moved on. By having commission-free trading, fractional shares and by using algorithms to automate this process with AutoInvest - the whole thing simply becomes a matter of tapping a button in the app.
To keep the level of overweight and underweight investments in check, you can use the rebalance feature on the app. If you navigate to your pie, you’ll find the ‘rebalance’ button.
If a stock is performing well, that’s a good thing, but it throws off the balance of your portfolio. This is because the portfolio becomes too reliant on the success of one company, and if something bad were to happen, the portfolio will be over-exposed to the failure of that company.
To keep the balance of your portfolio (ie the weighting of the investments the same) it’s necessary every so often to rebalance it by buying and selling the shares back to their original weightings.
Doing the calculations yourself for how much of each stock you should buy and sell, and then paying a commission on each transaction has traditionally made rebalancing a painful process.
Thankfully things have moved on. By having commission-free trading, fractional shares and by using algorithms to automate this process with AutoInvest - the whole thing simply becomes a matter of tapping a button in the app.
To keep the level of overweight and underweight investments in check, you can use the rebalance feature on the app. If you navigate to your pie, you’ll find the ‘rebalance’ button.
By using this tool, the Trading 212 algorithm will redistribute the winnings from your overweight stocks back into your portfolio until they hit their target weight.
Set And Manage Goals
Goals are important and you can set goals for each one of your pies.
To set these goals for your pies
STEP 1: Go into your Pies overview screen, scroll down to “Your goal” section.
STEP 2: Tap the edit button.
To set these goals for your pies
STEP 1: Go into your Pies overview screen, scroll down to “Your goal” section.
STEP 2: Tap the edit button.
STEP 3: Use the slider that appears on the screen to adjust the value of your goal. This is the value that you envision for your pie.
Setting value goals is a great way to stay motivated and remind yourself what you’re investing for. To track your goal all you need to do is look at the progress bar at the bottom of the ‘overview’ screen.
Setting value goals is a great way to stay motivated and remind yourself what you’re investing for. To track your goal all you need to do is look at the progress bar at the bottom of the ‘overview’ screen.
Wrap
One of the best ways to automate your investing process is to use a platform that offers help and suggestions for your investment decisions. Another way to automate your investing process is to set up automatic transfers from your bank account to your investment account. Finally, you can automate your investment tracking by using an online portfolio tracker.
Trading 212 offers a great way to invest your money and get started in the stock market using Pies and Autoinvest. With Pies, you can choose to invest in a specific company or sector, and with Autoinvest, you can set up a regular investment plan and let the platform do the work for you.
Trading 212 offers a great way to invest your money and get started in the stock market using Pies and Autoinvest. With Pies, you can choose to invest in a specific company or sector, and with Autoinvest, you can set up a regular investment plan and let the platform do the work for you.
