Asked on 21 Jun 2018
Anyone has any advice, thanks!
How about both? When you invest in robo-advisors e.g. Smartly, you are investing in US ETF too. So it depends on the market exposure you are looking at. For smartly it's converted to sgd on the site when you view it. There is also a currency impact portion where you can view it too. It changes everyday so when you feel that it's time to cash out, you can do so.
I think it depends on which market you want to start investing in! I use posb invest - saver for the regular savings plan to buy STI index. But I use Autowealth to buy US ETFs which is something I will never be able to do myself without their platform. I think if you are a new investor, it might be good to diversify as well.. maybe start off with Singapore ETFs first because probably lower risk? The admin fees are also lower for posb as compared to roboadvisors I think!
Firstly, Congratulations on taking the first step to start your journey with ETF. It is a good starting and learning point!
Secondly, It depends on the returns and the different markets that you want to be exposed to.
There are mainly two types of fund that people invest with POSB invest-saver
1) Nikko AM STI ETF (Sales Charge of 1%)
2) ABF Singapore Bond Index (Sales Charge of 0.5%)
Low Charges in Fee
Provides diversification in Stocks and Bonds
Robo Advisors (Stashaway, Autowealth, Smartly)
Leveraging algorithms in order to access your risk profile be it low risk or aggressive.
Annual fee, Platform Fee and etc (Recurring costs which will erode your returns)
Robo advisor are heavily into US ETF which have a 30% dividend tax on US equity if vested
You will be subjected to USD conversion rates and incurring currency fees charged by the brokers
You can read more in the link above on the pros and cons of each and ultimate decide your choice based on returns, exposure to markets and fees charges. Hope this helps!
Dear anonymous, change your tag for the benefits of the mess as it does not suit the topic of your questions.
Adding on to @Jay Liu and @ HC Tang whom I share the same idea with (why not BOTH especially u have the cash?) :
As a new investor (I just started too...), you wanted to get started somewhere. You are eager to. But you don't know how. You want to maximise learning experience, knowing and familiarise the market, getting a higher possible returns, with a lower possible risk and the lowest possible cost.
STI ETF (or posb invest saver) is a good way to get things started. Well-diversified + low cost + potential gains in the long run. You can thereafter start researching about local market.
Robo advisors are something you can start too because it meets your needs and wants. (Diversification and understanding global market). Different robo advisors provide different opportunities and style so do your diligence and choose your preferences and requirements before started with one (risk assessment). You can familiarise with the impact of currencies on your capitals/ results. Thus, the returns will definitely be affected, positively and negatively.
Hope this is helpful. I have done research on robo-advisors but no prior experience.
P. S: If only I have capital to start :(
HC Tang, Financial Enthusiast, Budgeting at The Society
Answered on 15 Sep 2018
Why choose one of you can do both since most robo is US market and POSB invest saver is STI. So do both for both market.
Yes for robo has currency impact , but the returns on long term also higher minus some of the currency impact. You can reduce that impact by deposit and invest in USD for Stashaway allow for min 10k USD.