Abbas Haider Ali wanted to put $25,000 into the stock market. Instead of transferring the money to a mutual fund, the Washington technology executive decided to invest with a money manager whose every move he had been tracking for three months through a firm called Covestor. Once a day, the online service shows you the stock trades of more than 130 money managers, a mix of professionals and amateurs, even if you’re not a customer. If you find a manager you’re comfortable with, you can see his or her trades in real time and mirror them in your brokerage account.

Here’s how it works: You check out a manager’s holdings, moves and performance on the mirroring service’s Web site. If you like what you see, you give the service permission to execute the same trades in your brokerage account in the same proportions that the manager makes. So if the manager puts 5 percent of his or her portfolio in, say, Netflix, the service will buy a 5 percent position for you in your account. For the privilege, you pay a fee of 0.5 percent to 2.3 percent a year on the amount of money you invest with the service to follow the manager. The size of the fee, split between the manager and the mirroring service, usually depends on the complexity of the investing style and the popularity of the manager you choose. By comparison, the average expense ratio for diversified U.S. stock funds is 1.35 percent annually.

The mirroring firms say their services give ordinary investors more transparency and control than they would have with a traditional mutual fund. That’s because you can see every trade a manager makes in your brokerage account almost instantaneously, as opposed to waiting for a fund to issue its quarterly list of holdings. You can create a list of stocks not to be bought for your account, even if your manager buys them, or sell a stock at any time.

Most clients of Covestor and its main rival, Wealthfront, are treading lightly. The average account balance for both is about $45,000. Ali was interested in Covestor because of the novelty of its approach to money management, and he wanted to see whether the manager performance posted on the site would hold up in his account. Ultimately, he gained the confidence to invest with the service because he closely tracked his manager’s trades.

“I used the most speculative money in my portfolio to see if this really works,” says Ali, who invested to mimic the trades of Vivian Lewis, editor of the newsletter Global Investing.

Covestor and Wealthfront (formerly known as Ka-Ching) have been in the mirroring business since 2009 and are the largest players. Others with similar services are TD Ameritrade, which offers mirroring accounts through the AutoTrade service of its think­orswim online brokerage, and Ditto Trade, which launched a mirroring service in October.

In some ways, these services are similar to separately managed accounts, which have been a fixture in the investing world since the 1970s. SMAs are professionally managed products that brokerage firms offer to well-heeled investors. With SMAs, you own the securities directly, rather than shares of a fund, and you can check your holdings and trades in real time. But the minimum initial investment with an SMA is typically $100,000; you can open an account with Covestor or Wealthfront with just $10,000.

Both Covestor and Wealthfront are investment advisory firms registered with the SEC. If you want to invest with either, you must open an account with an online broker, which takes custody of your money. To use Covestor, you open an account with Interactive Brokers. Wealthfront works with Interactive Brokers and Fidelity brokerage accounts. (The minimum to open a Wealthfront mirroring account at Fidelity is $25,000.)

At last report, Covestor had 178 investment options; 62 are managed by registered investment advisers and the rest are unregistered. “We don’t want to be overrun by professionals,” says Perry Blacher, Covestor’s chief executive.

Wealthfront is shunning amateur managers. As of June, it offered 41 registered advisers. The company scores money managers on three factors: the returns they generate relative to the risks they take, how consistently they stick to their stated investing style and their research process. Wealthfront says that an equally weighted index of their managers’ performance returned a cumulative 27.9 percent, net of fees, from October 19, 2009, through April 18, 2011. That is 4.5 percentage points better than the return of Standard & Poor’s 500-stock index.

Anderson is a contributing editor to Kiplinger’s Personal Finance.