Asked on 28 Jun 2020
Would like to also enquire more about the Syfe 100% REIT + portfolio. If this portfolio follows closely to the iEdge S-REIT 20 index, then what will the role of syfe's roboadvisor be? Because after all following the index would mean having the same composition of the index right? Will the algorithm therefore only result in either buying or selling ETFs in the portfolio in the same composition as the index itself?
Hi there, you're right - Syfe's REIT+ portfolio tracks the SGX's iEdge S-REIT 20 index to provide exposure to the 20 largest REITs in Singapore. This means that you will own these REITs in roughly the same proportions as that of the index.
Please note that REIT+ is not an ETF. As such, your funds are invested in the REITs directly, and not a REIT ETF.
Syfe's role is two-fold. Firstly, we offer optional risk-management for investors who prefer it. They can access this by choosing our REITs with Risk Management portfolio.
Secondly, we are the only platform to offer a REIT portfolio (not an ETF!) that tracks the iEdge S-REIT 20 index. You can of course replicate the index by buying the 20 REITs through a broker, but this will mean incurring 20 brokerage charges for each transaction made.
REIT+ offers a more cost-efficient way of investing in Singapore REITs. We have no brokerage charge and no minimum investment amount, which makes it ideal for investors who want to DCA. Moreover, there's no lock-in period and you can withdraw your funds anytime at no charge.
Lastly, our low fees start from 0.4% per year. With REIT ETFs, you're in essence paying two fees - ETF fees and fees to the platform provider.
It is not an index fund, however the managing company tries to track an index:
SGX iEdge S-REIT 20 Index
the caveat here is, that it is still composed of 20 REITs of Singapore
which is a low number, and very focused on Singapore only.
With their risk management opted in, it would even change to something
like active management, and with risk reducing also potential reducing.
I do also passive S-REIT indexing with only slighty less expensive Lion-Phillip S-REIT ETF, here the same caveat applies.
To be honest, VNQ and/or IQQP would be better diversified
REIT ETF opportunities, with better risk/volatility reduction.
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