Investing apps make it easy to tap into auto-investing—making it cost-effective to grow your portfolio even with a weakened dollar

However, for many investors who don’t want to take a hands-on approach to investing and don’t want to constantly monitor their portfolios, while scanning news and business reports, relying on auto investing makes participating in the markets much easier and less time-consuming. Unfortunately, investing tools and apps that offer auto-investing to trade traditional assets, such as stocks, exchange-traded funds (ETFs) and other securities, are still relatively new in Canada.

The good news is that more financial institutions and fintechs are starting to offer auto-investing options. But before you can use auto-investing tools, it's best to get a better understanding on what the term auto invest means, when and how to use auto-investing, and what tools are available to help make the most of your investing journey.

What does automated investing mean (what does it mean to do an automatic buy)?

While auto investing is a relatively new concept in Canada, the idea borrows from a more established concept of auto-savings programs which are offered by many major banks and quite a few fintechs. These automatic savings programs, a boon for financial planning, allow customers to set up predetermined transfer amounts from their chequing accounts to their savings accounts at regular intervals, such as every payday. One of the better known auto-saving program is RBC's NOMI program, which offers RBC customers the opportunity to find and save cash not allocated to pay bills.

However, RBC's NOMI isn't the only auto-saving option in Canada. Mogo launched Moka.ai. While Moka's parent company, Mogo, has been around for years, the Moka brand and concept — to provide actively managed portfolios and auto-investing options at a an affordable monthly rate — is relatively new in the Canadian marketplace. But the foundation of Moka's monthly plan is to help savers and investors to find and allocate unspent funds to savings and investing goals.

Whether using RBC's NOMI or Mogo's Moka, both options help monitor your spending and automatically transfer small amounts of money into your savings account. While the NOMI plan looks for money you are likely not to spend, the Moka account automatically rounds up your purchases and bill payments and uses the extra dollars and cents to quickly build a savings nest egg that can be used as an emergency fund or redeployed to grow your investment portfolio.

Of course, investors more comfortable with technology may already use an automatic investing strategy using either their online brokerage account or through robo-advisor platforms. Another option is to use more traditional investment tools, such as stop-loss orders. By setting up stop-loss or limit orders in direct brokerage accounts, an investor can automatically buy or sell a security helping to maximize investments or minimize potential losses.

Bonus: Some of these robo-advisor platforms and direct brokerage accounts are also some of the best investment apps in Canada.

How auto-investing works

Here's an example of how auto investing works. Let's say you use an intelligent robotic platform (commonly known as a robo-advisor) for auto investment. You would set up an automatic transfer of a set amount, like $500 each payday (or even just once a month), to be moved into your investment portfolio. Then, when the money is transferred into your portfolio, it is automatically invested based on your pre-set portfolio plan. For example, if you pre-selected a portfolio that prioritized growth, those transferred funds would automatically be invested into growth ETFs.