Asked on 02 Jul 2020
In terms of risk levels, does it mean Syfe REIT+ > Global ARI > Equity100 > Stashaway's? Bonds (in Stashaway's portfolios) have a lower risk than Reits and equities?
Do you think it would be advisable to maintain two portfolios from the different apps? 1 for a short-term goal like marriage / housing, another for longer term goal for family emergency fund, retirement, etc.?
My consideration is not having all the eggs in one basket where the returns are much lower than projected.
Hello! Thanks for your interest in Syfe. Let me get to your questions.
1) Risk levels. In general, the 100% REITs option on REIT+ and Equity100 (an all-equity portfolio) will have a higher risk compared to our Global ARI portfolio and portfolios from other platforms.
This is because they are fully invested in REITs / equities, with no bonds or gold to provide any diversification. So yes, they are considered higher-risk investments suitable for investors who are willing to face periods of share price volatility to achieve higher risk-adjusted returns over the long-term.
2) Different portfolios for different goals. Rather than two different apps, why not consider creating different portfolios within Syfe? For a short-term goal, you may consider the Global ARI portfolio at a lower risk level. We have options from 5% to 25% risk levels.
For a longer term goal, you can either choose our higher risk Global ARI portfolio, or go with Equity100 / 100% REITs.
In fact, one good way would be to implement a core-satellite approach using Global ARI and Equity100. You benefit from the steady market returns generated from your core investments while enjoying the thrill of your satellites outperforming the market from time to time.
If you've more questions, our financial experts will be happy to get on a call with you as well.
Personally, I have used Stashaway's platform before and they mostly invest in ETFs. Looking at Syfe's Global ARI and Equity100, they also invest mainly in ETFs. The ETFs are invested in the various sectors of industries and countries.
If you have multiple portfolios, you are probably just weighing yourself in certain ETFs more than the other.
For example, if you invested 50% into a Stashaway portfolio and 50% in a Syfe Equity100 portfolio, and both invests in the IJR ETF (Small-cap US ETF) at different percentages. Your weightage of that particular ETF would be different.
You are not "putting all your eggs in one basket" when you invest in an ETF through a robo-advisor. The purpose of an ETF is to diversify, and investing in one platform is more than sufficient.
As for the REIT+ portfolio, I cannot comment much because it is mainly based in Singapore and largely based on the Singaporean market.
In conclusion, to answer your questions, Syfe's Global ARI has various investments including equities and bonds and gold. Bonds and gold act as hedge and therefore will help mitigate risk. Equity100 is a 100% pure equity play. As for Stashaway, it would really depend on your risk index, but they are generally more diversified in terms of investment than Equity100.
Whether you think being fully vested in equities is a good or bad thing is up to you. Some people prefer the limited volatility. But even JPMorgan (US' largest investment bank) believes that the 60 stock/40 bond portfolio is bad. However, these economists are just humans and cannot predict the future. Look at how badly the economists predicted the world to be, saying there will be 20% to 30% unemployment rates a few months back. In reality, US unemployment is only 11% according to the June's job report.
Anyways, I feel like I gone a little off tangent but I hope my answer helped. You can browse my blog for more of my thoughts. :)
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