Should I invest in Syfe REIT+ or Lion-Phillip S-REIT ETF through OCBC blue chips for better returns? - Seedly
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Anonymous

Asked on 20 May 2020

Should I invest in Syfe REIT+ or Lion-Phillip S-REIT ETF through OCBC blue chips for better returns?

I’m thinking of investing in REITs.

Comparing investing in syfe reit+ or Lion-Phillip S-REIT ETF through ocbc blue chips, which is better for returns? Ever since smartly suddenly announced they’re shutting down on end March my trust for robo advisors have dropped. The only thing attractive is the fees. And yes I know many have said to copy and buy whatever is included in the REITs portfolio but the thing is I don’t have time to manage it. And is it logical to invest in Syfe with bonds or 100% REIT?

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Shaun WQ Lim
Level 8. Wizard
Answered on 20 May 2020

Depends on your risk appetite and profile, investment objectives and time period of investment. Find out, have a plan. Then commit and go.

OCBC BCIP cost per transaction is minimum $5 (excluding their current promo). The ETF expense ratio is known.

For Syfe REIT+, it tracks a different index and the cost is monthly on the total investment amount.

Both allow you to do monthly investments.

With Syfe’s REITs + Bonds, it is less volatile versus 100% REITs.

Both the ETF and 100% REITs portfolio have baskets of REITs but still have concentration risk in the REITs sector.

For Syfe, dividends are reinvested until you hit minimum Black status. ($20K invested or value)

For BCIP, the dividends are paid out as and when the ETF pays them.

If you can accept the cost of BCIP and do not want to take additional risk or have lesser trust in robos, go for BCIP.

You can always change your mind later on.

The point here is to start investing now.

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Frankie Rappaport
Frankie Rappaport

20 May 2020

DCA seems logical a good strategy, some academic simulations however tell otherwise. Study results possibly dependent on observation period, volatility, longterm average appreciation over whole study period and trading and other fees of that market & broker
Shaun WQ Lim

21 May 2020

@Anon, DCA is about investing consistently in the market at fixed intervals. So instead of doing monthly, some people do it quarterly or yearly. Of course the investment sum has to scale. As Frankie mentioned, over time the fees eat into the returns by DCA-ing versus a lumpsum strategy. As long as your horizon is long enough, there should be returns, just a matter of how much. And as you go along your investment journey, you could have different portfolios or strategies to meet your needs.
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Eliezer
Eliezer, Content & Community Lead at Syfe
Level 6. Master
Updated on 26 May 2020

Hello there! Syfe REIT+ tracks the SGX's i-Edge S-REIT 20 index, which measures the performance of the 20 largest and most tradable REITS in Singapore. When you invest in the REIT+ portfolio, you get to own actual units of these REITs.

Unlike OCBC's BCIP, there is no minimum investment to get started. There are no buying and selling transaction fees as well with REIT+. For BCIP, there is a charge of 0.3% of the total investment amount or $5 per counter per transaction, whichever is higher. If you are planning to invest regularly, REIT+ is by far more cost effective.

To boost your returns, dividends are automatically reinvested for Blue tier clients. That said, there are no withdrawal fees or lock-in periods. If you wish, you can withdraw your dividends at any time.

As Matthew mentioned, whether to choose 100% REITs or REITs with bonds will depend on your personal risk appetite. Our article here provides more guidance on how to choose as well.

Finally, while Smartly's closure is unfortunate, rest assured that Syfe has stringent measures in place to safeguard our clients' money and assets. As a CMS license holder, we have met all the stringent requirements and standards set by MAS to prevent a bankruptcy event from happening. This includes meeting the minimum capital requirement to ensure that Syfe has sufficient daily cash flow to meet all operational needs. We have elaborated on this point previously on Seedly. You can refer to more details here.​​​

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Eliezer
Eliezer

27 May 2020

Our REIT+ portfolio tracks the iEdge S-REIT 20 index, which is an index of the 20 largest S-REITs. Industrial REITs account for a third of that market cap, which is why our portfolio has a heavier weightage for industrial REITs. But in general, the circuit breaker measures have amplified the crucial role of supply chain management and e-commerce, which in turn benefits industrial and logistics REITs. This is likely a trend we'll continue to see in the long run.
Question Poster

27 May 2020

Alright got it thanks :)
Thank You!
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Frankie Rappaport
Frankie Rappaport
Top Contributor

Top Contributor (Aug)

Level 9. God of Wisdom
Answered on 20 May 2020

Lion seems very o.k., but every performance chance (dividends + stock price appreciation in this case) comes with it's own risks. Historically for it's recent inception date is somehow (?) cheap, but the general situation because of the C-crisis is very unclear. REITs particularly sagged a lot, ca. 50% of price dip however already recovered...

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Thank You!
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Matthew Tan
Matthew Tan, Undergraduate at NTU
Level 5. Genius
Answered on 20 May 2020

Hey there!

Im personally invested in Syfe reit portfolio and made the switch to the 100% reit. This is because my investment horizon is around 20-30 years and so I'm ok with the market volatility. If your investing horizon is shorter or prefer to have a more 'risk managed' approach then do consider opting for the portfolio with bonds. The risk profile is set at 15% and they will optimise the portfolio according to market conditions for eg. Higher allocation of reits when markets are doing well or higher % of bonds when markets are more volatile (like now).

I had a similar question some time back regarding the Nikko AM Asia Ex Japan Reit ETF. Do note that on top of the individual fees for the reit, there will be an expense fee for the ETF as well.

All in all, past returns cannot be guaranteed. Take a look at the reits that are inside each portfolio and assess which product is better suited for you. All the best!

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Question Poster

21 May 2020

Thank You!
Eliezer
Eliezer

26 May 2020

Thanks Matthew for sharing such a detailed response!
Thank You!
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