05 Nov 2020
Undergraduate at National University of Singapore
Hey Anon, I'd go with Endowus!
The main reasons are
1) Your funds are held in a separate custodian account under your own name and it's not co-mingled
2) Funds used are low-cost and equities are SGD-denominated while bonds are SGD-hedged
3) You're given a choice to opt-in or remain status quo if the robo-advisor introduces a new asset allocation
4) It's tax-efficient as you're not subjected to the 30% US withholding tax
I've touched on these points in greater details here https://seedly.sg/questions/should-a-student-in...
Honestly, if it wasn't for Endowus, I wouldn't even have considered unit trusts as part of my portfolio due to the high fees (structure). However, Endowus solved this pain point by rebating the trailer fees to their clients. The trailer fee is an incentive/commission to the company/advisor who sold the fund(s) to you. This means that they can remain transparent in terms of the funds offered/used on their platform as opposed to other financial institutions that might be incentivized to recommend certain funds to their clients due to the higher incentives that they will receive. It's just like how some insurance agents would recommend policies that would give them a higher commission, such as an investment-linked plan (ILP). I'm not saying that all insurance agents do this, but some do and they only share the good side of the policy e.g. the performance of the fund (excluding fees) or being able to get the best of both worlds (insurance and investment).
Anyway, regardless of which robo-advisor you decide to go with, it's important to select an appropriate risk index based on your risk appetite. While (supposedly) a portfolio with a higher risk index will offer better returns, it comes with higher volatility as well, and emotions are often the reason why people lose money. If you find yourself constantly checking your portfolio and panicking when the value drops, then you should probably consider changing to a lower risk index. There is no point investing in a high-risk portfolio if you can't tolerate the potential dips and volatility (and possibly decide to sell at the wrong time to "cut loss") to get that higher returns. For instance, one of my portfolios with Endowus (100% equities) was fluctuating quite a bit over the past 2 weeks or so, and dropped about $100 in value. But I see it as an opportunity to buy more and average down, which I did. Historically, it has been shown that markets go up over the long run so stay cool and remain invested, ignore the short-term volatility and noise.
All the best!
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0.2% to 0.8% p.a.
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