Between Syfe equity 100 vs Stashaway 36% which one is better for the long term?

With the following assumption
investment horizon >10 years
$500/month

I have been with SA for about a year now and am quite satisfied overall, however with the new equities 100 and a much lower fees for all investment <1M it seems like Syfe might be better in the long term in term of lower fees.

What concerns me is that alot of the underlying ETF with SYFE is US based and subjected to 30% withholding tax? this would significantly affect the returns isnt it?
Or is DIY with a broker be better?

StashAway Syfe

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Lin Yun Heng

11 Aug 2020

Senior Analyst at Delphi

You can check out my article on the comparison between Syfe and Stashaway here.

In essence, choose Stashaway if you have 25k or more to invest due to their high fees if you have less than 25k (0.8% +0.28% ETF expense ratio)

If not, the answer is obvious to choose Syfe Equity100 since it gives you the highest risk-adjusted return in the long run since it is 100% equities. You can also check out my article on Equity100 here to find out more information. Hope it helps!

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Eliezer

11 Aug 2020

Content & Community Lead at Syfe

Hi anon, that's a great question! There are fundamental differences between both portfolios. Syfe's Equity100 portfolio is 100% invested in equities. Microsoft, Amazon, Facebook, Alibaba, and more are among some of the key stock holdings in the portfolio. What's more, Equity100 is built using a multi-factor smart beta approach that's designed to generate better returns. Simply put, the portfolio is tilted to three key factors - growth, low-volatility, large-cap - that have driven and will continue to drive outperformance.

One thing to note about Equity100 is Syfe’s inclusion of the iShares Core S&P 500 UCITS ETF, which is domiciled in Ireland i.e. making it more tax efficient for investors (as compared to a US-domiciled ETF tracking the same S&P 500 index).

US-domiciled ETFs do levy a 30% withholding tax on dividends. This is not a 30% tax on all your investment gains. What's more, this tax is applicable whether or not you purchase your ETFs through a broker or through Syfe.

If you're planning to invest $500 each month, Syfe is more cost-efficient than DIY-ing through a broker. You save on brokerage costs incurred with each transaction and there are no investment minimums to meet. Ultimately with Equity100, you get to enjoy the better long-term returns of smart beta factors while keeping your costs low.

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