

Staygg - new app lets you invest small amounts of money for free - carloafs
https://www.staygg.com/

======
powera
I hate to be the naysayer, but NOBODY SHOULD USE THIS.

If you don't have a lot of money, open a Vanguard account and forget about it.
If you don't have the $1000 to set up a Vanguard account, put your money in an
FDIC-insured bank account. Seriously, if you don't have $1000 to invest you
are MUCH better minimizing effort and risk than trying to make an extra 5% on
your money (that's less than $50 per year).

Also, nobody should "invest" in any app that makes you pay to hide the ads.

------
bottled_poe
Finally it's here, the official Ponzi app.

But seriously - What exactly am I buying? Where are the details of the indexed
fund? No charges, how does that work? Don't these people need to pay brokerage
fees? I'm highly suspicious.

~~~
mmastrac
My guess: they are eating the management fees on an indexed fund that they are
just managing themselves. With enough volume they can offer other fee-ful
funds like the other guys and cover the costs. It's just a loss leader.

I'm assuming it's not a Ponzi scheme, but obviously could be wrong.

If everything is up-and-up this is actually kind of cool. I've been
disappointed at the lack of decent investment options for low-income savers.

~~~
saryant
Some Vanguard index funds have a $1000 minimum and you don't have to risk your
money with a (frankly) sketchy investment like this.

~~~
meric
You can also buy them on the stock exchange for less than $10 in transaction
fee, and I think the minimum there is a lot less than $1000.

~~~
saryant
Good point. IIRC, if you buy the ETFs directly from Vanguard, there is no
transaction fee, making it even less expensive.

------
heyalexej
It makes me a bit nauseous whenever I read or hear that somebody wants to
outperform the market with an actively managed fund that is resembling an
index fund. Like draugadrotten writes, such an endeavor can't be free.

The rule of thumb for the targeted audience of such a startup should be
exactly the opposite. To never pay someone to actively manage their portfolio
that is.

"Data from recent decades demonstrates that the majority of actively managed
large and mid-cap stock funds in United States fail to outperform their
passive stock index counterparts."[0]

Edit:

No, seriously. What the kids they are targeting need is to learn to manage
their personal finances[1] and invest very early in very boring things. With a
very simple and boring strategy that takes a couple hours a year[2].

Most fund managers are essentially useless[3] and according to numerous
studies very seldom outperform the market. Unless you have millions in spare
change to give away to someone who gambles with your money, stay away from
them.

[0]
[http://en.wikipedia.org/wiki/Active_management#Disadvantages...](http://en.wikipedia.org/wiki/Active_management#Disadvantages_of_active_management)

[1]
[http://www.reddit.com/r/personalfinance/wiki/index](http://www.reddit.com/r/personalfinance/wiki/index)

[2]
[http://www.etf.com/docs/IfYouCan.pdf](http://www.etf.com/docs/IfYouCan.pdf)

[3]
[https://www.youtube.com/watch?v=SwkjqGd8NC4](https://www.youtube.com/watch?v=SwkjqGd8NC4)

~~~
splike
I don't think it is promising to outperform the market at all

"Our fund aims to replicate the returns of the S&P 500."

~~~
heyalexej
Doing that reliably over a meaningful period of time is the problem. In my
book (from the perspective of an investor) you'd need to "outperform?" the
index to cover the costs of frequent trades and potential losses at no actual
cost to the investor.

~~~
meric
It says replicate, not outperform.

Just buy the Vanguard index fund.

It's easy to replicate the returns on the index, you just use the dividends to
pay the fees, since the S&P500 index includes only capital gains only and is
not "Total Return" (include capital gains plus dividend).

------
primitivesuave
I honestly can't imagine any level-headed investor trusting any amount of
money to a bunch of recently-graduated economics majors through an iPhone app.

~~~
CmonDev
At least they used vanilla Bootstrap for their website.

------
patio11
Is this mutual fund registered with the SEC?

------
jacobkranz
Why would I put my money here rather than robinhood.io, which is FINRA
accredited, free, and has top tier investors?

This needs way better transparency

------
meric
What we need is an app to vacuum up whatever spare change is left of retail
customers at the top of a stock market, and Staygg is that app.

------
carloafs
Hey guys,

I'm Carlos, one the of the Staygg founders. The app is not a Ponzi scheme, the
fees will be made up in other ways as described in the FAQs on the website,
and the mutual fund will provide daily liquidity, will be registered with the
SEC, and will nearly perfectly replicate the S&P 500 - it does not aim to
outperform the S&P 500. The mutual fund itself will not be innovative in any
way - except that it's free - and the investment team won't be actively
managing the fund. The real motivation behind this product is that each person
on the Staygg team thought it would be cool to have an app like this so we
decided to make it ourselves and make it available to others.

Thanks for the feedback.

Carlos

------
zoskia
I think this trend is a disaster for tech/finance interoperability. You should
- for all intents and purposes - be your most liquid in your savings. Not your
least.

------
draugadrotten
\- Fees are hidden, nothing is "free" \- The time from when you pay until you
own the shares is hidden The time from when you "sell" until you have the
money again is hidden \- They "aim" to replicate the S&P500 but then they can
differ. How much and how often. \- All risk and volatility is hidden \-
Security of computer systems. They seem to be brilliant math guys with little
computer security experience at all. Bitcoin syndrome.

