Best Robo-Advisors

What is a Robo advisor?

Robo advisor in Singapore represents a personalised trust where investors can invest their money in.

They provide investment solutions based on mathematical rules or algorithms. These algorithms are calculated and programmed by humans based on financial models and risk appetites set by the company and require lesser human supervision.

This is, in contrast, to actively managed funds that are run by mutual fund managers. With the use of algorithm, the cost of managing the fund is cheaper as compared to the hefty 2-3% management fee that fund managers usually charge.

In Singapore, most of the robo advisors invest in US and global ETFs, and the portfolios are usually exposed to a variety of asset classes that encompasses equities, commodities and gold.

What does a robo advisor do?

According to our robo advisory blog article, " the advent of robo advisors — digital platforms that make automated and algorithm-driven investment decision — made low cost, diversified, passive investing accessible to investors."

In Singapore, the process for signing up to invest with a Robo Advisor is as such:

• First, the robo advisor will collect information from the investor to understand the risk appetite, investment time horizon, future goals and financial situation that the investor is in.
• Once the above is done, the investor will be assigned one of the robo advisor's portfolio that best suits the investor.
• The investor can then fund the account. This can be done either through a lump sum or a monthly option.
• The robo advisor will then monitor the market, rebalance the portfolio if need be.
• However, as most of these are done with the help of an algorithm, investors might not be able to freely and actively choose to allocate their investment different from the fixed portfolio provided.

The Best Robo Advisors in Singapore 2020

Currently there are a few major Robo advisors in Singapore. They are mainly:

StashAway

• Management Fees / Platform Fees/ Advisor Fees: 0.2%-0.8% p.a depending on your investment amount
• Minimum Investment Amount: None; S$10,000 for Income Portfolio
• Investment Portfolios available: Selected assortment of highly diversified, liquid and low-cost exchange-traded funds (ETFs)
• CPF SRS Investment option available

Endowus

• Management Fees / Platform Fees/ Advisor Fees:
  Between 0.60% (up to S$200k) to 0.25% (more than S$5 Mil) of AUM p.a.
  0.4% for SRS CPF portfolio
  
• Minimum Investment Amount: S$10,000
• Methodology: Building of Global portfolio via Dimensional Fund Advisors (DFA) & PIMCO funds
• Investment Portfolios available: Globally diversified, low-cost portfolios built on best-in-class mutual funds (or unit trusts)
• CPF SRS Investment option available

AutoWealth

• Management Fees / Platform Fees/ Advisor Fees: Flat fee of 0.5% + USD18 platform fee per annum
• Minimum Investment Amount: S$3,000
• Methodology: Rule-based allocation (fixed way of allocation based on risk profile)
• Investment Portfolios available: AutoWealth portfolios are diversified across more than 8,000 stocks and 600 government bonds across 4 geographical regions, and index-tracking ETFs

Kristal.AI

• Management Fees / Platform Fees/ Advisor Fees: 0% - 0.3% p.a.,
  No management fees for accounts up to USD$50,000,
  0.3% p.a. thereafter
  
• Minimum Investment Amount: -
• Methodology: Curated ETFs, goal-based financial planning and customised portfolios by AI-based advisory
• Investment Portfolios available: Curated ETFs

Syfe

• Management Fees / Platform Fees/ Advisor Fees: 0.4% to 0.65% p.a. depending on your investment amount
• Minimum Investment Amount: None, but a minimum of USDS$5,000 is recommended
• Methodology: Believes long-term investing is more about managing risks than chasing returns. Takes a dynamic, risk-based approach to your portfolio’s asset allocation to deliver better returns.
• Investment Portfolios available: Curated ETFs

SquirrelSave

• Management Fees / Platform Fees/ Advisor Fees:
  0.5% management fee per annum and 10% performance fee
  
• Minimum Investment Amount: -
• Methodology: Fully AI platform that invests based on personalized risk profiling of individuals.
• Investment Portfolios available: Global ETF portfolio

Phillip SMART Portfolio

• Management Fees / Platform Fees/ Advisor Fees: 0.5%
• Minimum Investment Amount: S$5,000
• Investment Portfolios available: Unit Trusts, ETFs, closed-end funds, investment trusts, business trusts and Exchange-traded notes.

UTRADE Robo

• Management Fees / Platform Fees/ Advisor Fees: 0.5% - 0.88% p.a. depending on your investment amount
• Minimum Investment Amount: S$5,000
• Methodology: Automated fund management service that maximizes investment return for each client's risk profile, which is determined by their financial objective and risk profile.
  
• Investment Portfolios available: Global diversified curated ETFs across equities, fixed income and commodities.

OCBC RoboInvest

• Management Fees / Platform Fees/ Advisor Fees: 0.5% - 0.88% p.a. depending on your investment amount
• Minimum Investment Amount: USD $100
• Methodology: Selected baskets of portfolios comprising stocks and ETFs, specially curated by OCBC’s leading wealth experts.
• Investment Portfolios available: 33 types of portfolios across 6 risk tolerance for investors to choose from, including exchange traded funds (ETFs) and equities

DBS digiPortfolio

• Management Fees / Platform Fees/ Advisor Fees: 0.75% of AUM p.a. (Portfolio Management Fee) for all amounts of investment
• Minimum Investment Amount: S$1,000 or USD$1,000
• Methodology: Hybrid investing combining expertise from DBS private banking and robo-technology for a cost-effective way to grow and protect your wealth through regional or global diversification.
• Investment Portfolios: Global and Asia portfolio. Invest according to different risk profiles

CONNECT

• Management Fees / Platform Fees/ Advisor Fees: All-in management fee of 0.75% per annum across all portfolios
• Minimum Investment Amount: USD$1,000
• Methodology: CONNECT combines personalised advice, the latest technology and academic research, from Nobel Laureate Academics and scientists working with Dimensional Fund Advisor, so you can capture returns in the long-run through the premium associated with dimensions of higher expected returns.
• Investment Portfolios: Connect's portfolios can span over 10,000 securities across 44 countries, providing maximum diversification

Can robo advisors beat the market?

While the idea of using algorithms to invest sounds genius, investing with robo advisors are not a sure win.

Despite being intelligently diversified, your investments made through your robo advisor are still susceptible to market fluctuations. There are still risks to the assets chosen.

Your investments will rise and fall over the short term and you can still lose money investing with robo advisors. Hence, robo advisors are not a sure-win way to beat the market.

Tools to help you choose the best robo advisor for you

To help Singaporeans make smarter personal finance decision, here are some tools to help you:

One can read up our comparison article on all the robo-advisors here:

• Robo Advisor Comparison - which is the Best Robo Advisor in Singapore
• Robo-Advisor vs Financial Advisor: Which Is Better?
• Check out what the robo advisory companies themselves have to say in our Robo-Advisor AMA with Stashaway, Autowealth and Smartly

If there are still questions after reading Real User Reviews on the Robo Advisors or ask the community at Seedly Community