I don't work at any of the roboadvisors/digital wealth management platforms but have attended enough meetups where the StashAway or Endowus teams answer these questions when people ask. It's usually confidential and something they can't disclose because it's private business information that could be sensitive for their clients and also poses competitor analysis risk.

Dimensional Fund Advisors are a fund house like Aberdeen, Blackrock, Vanguard, etc. They founded an evidence backed investment philosophy that has shown that there are factors (dimensions) that have returned above market returns. 1) Small cap companies do better than large cap companies 2) Value does better than growth 3) Profitable companies does better than less profitable companies Using these 3 factors for their equity portfolios, they have created funds that will buy companies that fall into this list. One of their funds, the World Equity Fund, holds obver 10000 securities from 44 countries that passes their framework. Only when certain stocks no longer pass their framework or when stocks come into their framework, will they make a decision to buy or sell the units. So their funds almost work like index funds, it's just that index is created by them which is created from a theoretical or scientific look at it, and then the practical aspect is in the fund management. Now because there aren't any more guesses to be made, they can charge very low fees like index funds. But you have constant attention to the portfolios/funds they provide as they are looking at it every day.

Dear Anonymous Thank you for your question. As a start, let me just say that it is good that your adviser has offered you Dimensional. Not many would as advisers get paid lower using Dimensional than actively managed funds. This is because Dimensional do not pay any trail commissions to advisers at all. I think that if you feel that you are comfortable with your adviser and that he is more than competent to craft a good financial plan for you, as well as he is able to coach you during market volatility, you can trust your adviser with your financial life. I will just share some of the plus points about MoneyOwl here including how we manage clients during market volatility. Please allow me to reproduce an answer that I gave previously. At MoneyOwl, we believe that in order to have a good investment experience, one should not try to guess where the markets are going, time it by getting in and out of them. Instead, one should stay invested for the long term as scores of evidence have shown that stock markets always go up in the long term. The problem is, the head may understand this especially during “peace‘ time but when markets start tumbling, the heart may not follow what the head knows. So how do we align the head and the heart? To do that, a lot of things need to be done even before a downturn. Some of the things we do at MoneyOwl are: Education: We continuously publish our professionals thoughts and guidance here at advice.moneyowl.com.sg. Through education not just on investment matters, but also on insurance, estate planning and general financial planning issues, we hope to help our clients make correct financial decisions. Progressively, we will educate our clients even more via infographics, videos and educational events such as the investment symposium that we will be holding in the morning on 25th of May. If you participate in all the above, it would be like attending a financial literacy university. In fact, at MoneyOwl, we already have a team of financial literacy trainers providing education to investors. Financial Planning: In helping the head make the right investment decisions through our robos, we ascertain and help our clients strengthen their ability to take risk. This is done by ensuring that your financial health is strong, that you are sufficiently well covered by insurance, and that you have enough time horizon. We also help you know your need for returns from your investment based on the financial goals you want to achieve. We ascertain your willingness to take risks through our simple but yet accurate risk questions. Once we understand your need, ability and willingness to take risk, we would be able to recommend a suitable investment portfolio for you with the risk and return characteristics that you need, able and willing to stay invested. The robo will also regularly rebalance your portfolio to reflect the risk that you should take. While you can do many of the above through our investment robo now, we would be able to help you do all the above when our comprehensive financial planning robo is rolled out in a few months time. Bionic Advisory: As you might know by now, MoneyOwl is not a pure investment robo. We have currently launched 3 robos (insurance, will writing and investments). As mentioned, in a few months time, our 4th robo, the comprehensive financial planning robos will be up. But beyond advice via technology, we are really a bionic financial advisory firm. What that means is that after you have gotten your first level advice through our robos, we have a team of competent & conflict-free (as they are all salaried and do not receive commissions) advisers, using their wisdom to complete the advice if you wish to consult them. An example of what these advisers can do for you is to confirm your risk appetite decisions. While we have a good set of risk questions to ascertain that, your willingness to take risk is really a matter of the heart, influence by many factors that are complex enough that a robo might not fully empathize. Our advisers will be there to provide the judgement so that you can make the correct investment decisions that will help you stay invested when markets become volatile. If we do all the above well and together with you, the chances of you staying invested will be much higher when the markets start to become rough. But when the “shit really hits the fan”, besides doing more education through articles, videos, and events, you can be sure our advisers will be on hand to guide you through the storm. You always have access to them. One of our parent companies is Providend, a home-grown financial advisory firm who have been around since 2001 and have gone through the Glocal Financial Crisis of 2008. In that crisis, markets fell almost 40% in 3 months. They have learnt through experience that by doing the above, the chance of helping clients stay invested is higher. MoneyOwl now adopts the same process. We know that financial decisions are often emotional. Robots may be good in many things. But they don’t understand human emotions. That is why MoneyOwl is bionic. So in a nutshell, when you engage MoneyOwl, you are not just engaging an individual. You are in fact having the advice from the entire organization as all our advisers operate the same way. Also, the investment and financial planning philosophy are not adviser-based but institutional based. The philosophy comes from 2 decades of experience from one of MoneyOwl's parent companies, Providend, whom has managed monies through the GFC in 2008. You also have the assurance that MoneyOwl is here to stay as the other parent company of MoneyOwl is NTUC Enterprise. Hope the above is helpful for you.

Hi Anonymous, it's Chuin Ting from MoneyOwl. Thank you for your question. We start first from our investment philosophy - what would give our clients the best chance of meeting their financial goals - and then look for funds and instruments that best fit this philosophy. We also take into account what is suitable for the ordinary, Singapore-based investor. We looked at about 4-5 fund managers' products before landing on Dimensional. Our investment philosophy has the following main tenets: 1. Broad diversification - because we believe that asset allocation explains the bulk of the variability in returns, we go for globally and sectorally diversified funds that provided the broadest market exposure to "make up" or fulfil our asset allocation-based portfolios. In this way, we do not take country/market, sector, or company-specific risks. For equities, this means global equities (both developed markets and emerging markets). For bonds, we go for global bonds (but hedged back to SGD - explained below). Dimensional funds we have chosen for equities have 7,500 securities in the Core Equity fund, 900 securities in the Emerging Markets Large Cap fund and 200 securities in the Global Short Fixed Income fund. 2. Market-based return, not "active" management based on forecasts or individual manager skill - we believe that markets are efficient, and the track record of active fund managers has been very poor. We believe in harnessing the collective wisdom of markets. In both the short and long terms, only a minority of active managers outperform their benchmarks - and this is observed across developed markets equities, emerging markets equities and bond markets. Furthermore, the persistency of good performing managers is low - in other words, even if you managed to select one manager in that minority that outperforms in year 1, by year 5 in all likelihood he is no longer top performing. Thus, we choose funds that do not do such active management such as tactical asset allocation shifts based on reading of macro data or forecasts, or stock picking based on forecasting sector rotation or company earnings. 2 types of funds can fulfil this "market-based" criterion. One is passive funds, but there are no globally diversfied passive indexed funds available for retail clients in Singapore. (On why we did not choose ETFs, please see below.) Two is "evidence-based" funds, namely, Dimensional funds. In its funds, Dimensional takes a broad market exposure and tilts them towards “dimensions” or factors that have been documented over time and with evidence of higher projected return over the long term. For equities, for example, these tilts are towards value, small size and profitability. The observation of these dimensions are based on leading academic research, including that by Nobel laureate Eugene Fama and his colleague Ken French (Fama being the progenitor of the Efficient Market Hypothesis in 1966). Note that market efficiency does not mean that all assets have the same expected return. As a side comment, this trust in markets rather than in individual manager skill is evinced in the corporate culture of Dimensional and its principals. On a corporate level, to keep costs low, they do no advertising, never pay any commissions, moved their HQ to Austin, Texas. Over the past years when my colleagues and I met with Dimensional folks, we were struck by how humble and down-to-earth they are. By their own admission, they are rather "boring". But perhaps the meek do inherit the earth: Over a 15-year period from 2003-2017, 73% of Dimensional's equity and fixed income funds outperformed their prospectuses' benchmarks, while in contrast only 14% of equity and fixed income funds that were around at the start of 2003 beat their Morningstar category index. 3. Low costs - kudos to all the companies in this event on this count, which are choosing low-cost funds which pay no trailer commissions (which often account for up to half of funds' high expense ratios) because this affects the return of investors. However, low-cost by itself is insufficient for a fund to be selected by MoneyOwl, as there are funds which have low expense ratios but market-time through allocation shifts in response to macro or market data. 4. Suitable for small investors in Singapore - this set of considerations lead us to prefer SGD-denominated unit trusts rather than ETFs: a. As an NTUC social enterprise, MoneyOwl seeks to serve the ordinary investors and we particularly encourage regular savings plans (RSP) whereby a sum is put towards investments every month. We start our minimums at $100 lump sum/ $50 monthly, so almost everyone can invest! For this reason, while ETFs listed on overseas exchanges were considered, they are not suitable for small investors as the amount invested might not be enough to buy whole shares and investors would end up either with fractional shares, or not be fully invested. MoneyOwl is not comfortable with fractional shares of ETFs as legal ownership is not clear. There is no such problem with unit trusts/ funds. (There are a few additional issues of withholding/estate taxes, bid-ask spreads, forex spreads etc. esp for US-listed ETFs) b. There is no suitable global bond passive ETF that is currency-hedged to Singapore dollars, unlike the Dimensional bond fund which is currency hedged. Bond currency exposure is generally hedged back to base currency because the volatility of currency exceeds that of bonds, and it does not make sense to take this additional risk. Finally, I want to add a point that, while not directly related to why we chose Dimensional, is relevant in MoneyOwl philosophy of how we give clients a successful investing experience. Dimensional funds are unique in that worldwide, they are sold only through advisers. Dimensional believes in "advisor alpha" - that through the work of advisors in helping clients navigate trade-offs and especially to risk-coach clients to stay invested during turbulent times and not market-time by moving in and out and losing out on return. Thus MoneyOwl is more than just an access channel to low-cost or quality investments. Some people have commented that many "roboadvisors" are more robo-fund managers or robo-tools. MoneyOwl has a robo platform through which we deliver some parts of advice, but we also have a team of human advisers - our bionic model - to deliver this "advisor alpha" that Dimensional believes in. Thank you for reading this and I hope it gives you better insight into how MoneyOwl selects funds for our advisory portfolios. I'll be happy to explain more at the event!

HI Zhirong, I didn't have a chance to answer your question at the live question session yesterday night, partly because it gave me pause and actually a little moved -- that you would ask us robo/bionic advisers, coming to market a relatively new business model, about our ideal customer; when surely it is our job to ask you, what you wish to see in your advisor and how we can journey with you in a way that really adds value to your life. For MoneyOwl, our purpose is really getting advice right for the ordinary man in the street so that every family can have a plan for sufficiency in retirement, adequant protection against the things that can destroy this plan, from a holistic viewpoint, and enough buffers for peace of mind and give the stretch to that hard-earned dollar. For some customers, this would mean investing in a way that has little guesswork. For others, it could mean just sorting out or saving through CPF without having to buy any products or even invest with us. Yet for others who need it, just budgeting advice and saving into instruments like the Singapore Savings Bond. Perhaps our perspective is a little different because we are not just doing investing, but comprehensive advice.

Hi Anonymous, thanks for your question! Firstly allow me to clarify the structure of an investor's relationship with MoneyOwl vs Dimensional and the roboadvisors you mentioned. An investor would invest in Dimensional funds through or with MoneyOwl ; and the parallel is that an investor would invest in ETFs through roboadvisors like Stashaway or Autowealth. So the "equivalent" of Dimensional funds are the ETFs (provided by Vanguard, State Street etc.) and they are the underlying funds with fund managers. Whereas MoneyOwl's "equivalent" in terms of the relationship with an investor is the roboadvisor like Stashaway or Autowealth. The investment philosophy thus has to be considered on different levels as well. On the underlying fund level, Ting So and Yang Teng have described the differences between Dimensional and ETFs (passive indexed funds traded on exchanges). I would say that there is commonality in both Dimensional funds and ETFs used by roboadvisors in being market-based (largely following market, no "active" management in terms of stock picking or tactical asset allocation/ market timing), low-cost and broadly diversified. To digress slightly - but on an important point: there are structural differences between Dimensional funds, being unit trusts, and ETFs, those used being US ETFs, that affect the accessibility, return and risk of the investor that are not directly to do with markets. Broadly speaking, they are as follows: (1) Dimensional funds, being unit trusts, can be invested even with small amounts down to your last dollar. MoneyOwl, being a social enterprise seeking to bring great solutions to the ordinary person, has a low threshold in terms of investment quantum of $100 one-off/ $50 monthly. To do the same with ETFs, you would have to either have larger investment amounts, accept some drag from keeping some spillover in cash, or fractional shares with your record kept at the roboadvisor's level and you may or may not be comfortable with this. (2) ETFs (depending on which ones are used) may have a lower headline Total Expense Ratio (TER) than Dimensional funds, but the situation may be reversed once you consider hidden costs of ETFs especially withholding tax treatment, but also fund bid-ask spread and forex bid-ask spread. Dimensional funds used by MoneyOwl are domiciled in Ireland, are much more tax-efficient than ETFs, and traded on NAV, without bid-ask spread, and are registered in Singapore as SGD funds. (3) For the bond portion, Dimensional funds are fully hedged back to SGD, your base currency, whereas US bond ETFs are not. It is important to hedge bonds back to base currency because the volatility of currency is higher than that of the volatility of bonds. If you do not hedge out the currency, then actually you are taking more risk that you had meant to by incorporating bonds into your portfolio and you are really investing in a different type of portfolio with a different risk profile. Please read this article for more important on differences in structure https://advice.moneyowl.com.sg/why-unit-trusts-and-not-etf/ To return to investment philosophy: just as important to consider, besides the investment philosophy of the underlying funds, is the investment philosophy of the one "with" or "through" which you invest -- MoneyOwl or the roboadvisors. While the underlying instruments are market-based, or passive or passive-plus, do understand whether there is an active overlay expressed in terms of dynamic or tactical asset allocation, based on such views as macroeconomic changes, market forecasts etc., and which you are convinced by. MoneyOwl believes that it is very hard to beat the market consistently over the long run by changing tactical asset allocations, as borne out in the active managers' longstanding underperformance as a group and also the lack of persistency of champions who make it in on year. Instead, MoneyOwl believes in staying invested in globally diversified portfolios over your investment horizon to capture market return, without going in and out. Rebalancing for us is about returning to the weights that present your intended risk/return mix or asset allocation, based on your need to take risk, your ability to take risk and your willingness to take risk, not about changing asset allocation mixes. A full description of our investment philosophy is here https://advice.moneyowl.com.sg/the-right-way-to-invest/ You may also wish to join us at our inaugural Investment Symposium on 25 May 2019! https://www.eventbrite.sg/e/moneyowl-investment-symposium-registration-60702740531 In addition, you may wish to understand how each of the companies you are investing "through" or "with", adds value as there are meaningful differences. After all, you pay an advisory/"wrap"/access fee. There are many models, some are more like robo-macro fund managers (as they shift asset allocations), some are more robo-tools for access. For MoneyOwl, allow me to describe who we are and what we do: 1. Our core is advisory, and bionic (not just robo-) advisory. Bionic advisory means combining tech and human wisdom, and we have a good-sized (human) advisory team of fully-salaried (non-commissioned) advisoers who are available to you not just for client service, but for actual regulated financial advice. Why do we believe that humans are important in investments? This is because money is a very personal thing and can involve not just the head but the heart. There can be complexities in how the need to take risk, ability to take risk and willingness to take risk interact or contradict each other, and human wisdom for risk coaching is needed. Most importantly, risk coaching is important to help investors understand how markets work and to stay invested through turbulent times, to not lose out on return but capture the full market return upon recovery. In fact, Dimensional funds are not available directly to investors worldwide, but they only distribute through advisers, because they believe in the advisor alpha or value-add to a client's investing experience. 2. We are a comprehensive financial advisor, not just an investment (robo-)advisor, though we have an investment platform, which is our third robo after insurance and will-writing. These are all on our website at www.moneyowl.com.sg In the next few months, we will roll out our fourth robo which is the comprehensive planning module that incorporates CPF LIFE into retirement planning as the starting point or bedrock of retirement planning for Singaporeans and PRs. If you check out our content site at advice.moneyowl.com.sg, you will see that our range of articles is not just about investments, but about insurance, estate planning, wills, CPF etc. 3. Finally, MoneyOwl is not a pure start-up, but a joint venture between NTUC Enterprise and Providend. NTUC is a household name that has been around for decades, to serve ordinary working families and help everyone stretch the hard-earned dollar. Providend is the first fee-only, conflict-free independent financial adviser in Singapore, one of the first set up almost two decades ago, known for its best-in-class expertise and ethical advisory practice. As part of a larger corporate group, we also take security seriously, with MoneyOwl being an ISO27001 certified company despite being only about 9 months old. We are thus confident to bring our services to the Singapore mass market, with this unique parentage that brings a combination of mission and experitse, to be with you in your investment and holistic financial planning journey. Hope this helps and thanks for reading!

I was browsing around and saw that Smartly had a limited time offer on management fees as well!

They both have quite differing approaches to the market. If you can't decide between either, just try both for 3 to 5 years and see the difference.

If you are using roboadvisors, the $100 a month will not significantly affect the profits. It will affect if you are doing manual transactions and the broker fees eat up most of the amount. Roboadvisors charge based on AUM, assets under management. So it will be a % based on your total assets with them.

Hi Caleb, you are spot on that we are on track in releasing our comprehensive planning platform as well as investing via SRS very soon! Other than that, be assured that there are a couple of other new features in the works regarding our investment platform to serve our clients better. Regarding your other question on new funds, we have an internal investment committee that researches regularly on possible new funds to add to our portfolios. Ultimately, any new funds has to be aligned to our investment philosophy and value add to the portfolios we provide in terms of risk, returns and exposure. As mentioned in the reply to your review of MoneyOwl , do send any feedback or ideas that you have to me at [email protected] ! Stay tuned to the upcoming new releases! ;)