What are all the fees involved with DBS Invest Saver RSP - for both UT and ETFs? - Seedly
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Anonymous

Asked on 02 Feb 2020

What are all the fees involved with DBS Invest Saver RSP - for both UT and ETFs?

I know the most obvious ones would be the

  • sales charge 0.82% for UTs and ETFs (non-bonds),

  • expense ratio for ETFs (0.3% for Nikko STI, how about the REIT ETF and UT?)

What else should I note of? Taxes, etc?

Are there any hidden fees?

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Frankie Aufhauser-Rappaport
Frankie Aufhauser-Rappaport
Top Contributor

Top Contributor (Feb)

Level 8. Wizard
Answered on 14 Feb 2020

They say:

"Zero platform fees and management fees. Instead a sales charge of 0.50% or 0.82% is deducted from your monthly investment amount – to buy, to process corporate actions and to safekeep the funds for you."

.....

The stock exchange taxes for trading are neglegible.

It seems that the unit trusts (mutual funds) do not have the traditional high 'initial sales charges'.

HOWEVER:

-0.82 % per transaction is a hefty fee

  • unit trusts currently still have - by modern standards - very high hidden fees in

the form of annual management fees subtracted not by Your broker but

automatically by the unit trust company from the fund's internal value (NAV).

These annual 'hidden' fees are for the 3 example funds mentioned on the

DBS website very high:

1.44 % for Schroder Asian Income

0.78 % for Goldman Sachs Emerging Markets Corporate Bond Portfolio

1.45 % for JPMorgan Global Income Fund

Try to find a less expensive regular ETF savings plan.

And with the unit trust fees currently still so unexceptably high for prudent

investors, try to avoid unit trusts anyway.

and: calculate the above mentioned fees plus nominal SG inflation

1.45 + 0.4 = 1.85 percent/year, or

with inflation in SG expected to rise to stable 1.4% in the coming years:

You will have 1.45 + 1.4 = 2.85 % real loss per year with these investments,

very difficult to catch up with a hopefully successful (?) unit trust.

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Shengshi Chiam, CFA
Shengshi Chiam, CFA, Personal Finance Lead at Endowus
Level 6. Master
Answered on 16 Feb 2020

The high expense ratios of the Unit trusrts have to be taken into consideration.

These are mainly due to trailer fees, which are paid by the fund managers to the distributors for helping them sell their product. This creates conflict of interest.

You can read about it more here!

https://endowus.com/insights/mutual-funds-investing-what-are-trailer-fees-and-how-they-eat-into-your-investment-returns-9871223d7f/

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