Robo-advisors are taking the world by storm because they’re the best and most affordable alternative to financial advisors. Oversea Chinese Banking Corporation (OCBC) has ventured into the industry with the OCBC RoboInvest, which many laud as one of the best robo-advisors with an algorithm that allows you to use multiple collective investment schemes, automatically rebalance your portfolio, and more.
However, is it truly any good to use as an alternative to financial advisors and help you avoid risks while meeting your specific investment objectives and financial goals? Learn more about it from this review.
- 36 thematic and 6 core portfolios
- High-quality instruments for technical analysis
- Consistent mobile and desktop experience
- Low minimum deposit of US $100
- Access to local and global products
- Automated Portfolio Management Service
- Bank-grade secure interface
- Online access to your portfolio anytime
Funding and Fees
- Minimum deposit of USD $100
- Service Fee: 0.88% per annum
- Exchange fees and charges depending on which markets you trade in
How it Works
Robo advisors are available to many investors to diversify their portfolios. They use algorithms and machine learning to determine appropriate investment strategies for clients. Robo-advisors provide recommendations to clients on what they should invest in and the right time to do so.
OCBC’s robo-advisor algorithm in RoboInvest has many similar traits to typical robo-advisors, but leverages their financial advisors’ collective investment banking knowledge and strategies to maximize each investment opportunity.
OCBC RoboInvest Asset Selection Algorithm
The true algorithm behind OCBC’s RoboInvest is a protected trade secret. However, it is most likely to use over quantitative factors that range across the following asset aspects:
- Quality: Asset quality refers to the risk it possesses. Companies that are far more stable with minimal debt and consistent revenue are high-quality assets.
- Value: An asset’s value looks at its existing assets versus its stock price, which is also known as price-to-book. A company with poor assets but high stock is overvalued, while a company that has otherwise is undervalued.
- Growth: This refers to the asset’s growth potential in the next 3-5 years or beyond based on previous performance data. Grouping together assets with similar growth is likely important for OCBC’s algorithm and using diverse assets that balance their portfolio themes.
- Momentum: All assets change in price in a single day. Some assets change their prices faster or slower than other assets. The velocity or frequency of these changes are important to consider in most portfolio-making ventures.
- Volatility: An asset that’s volatile has a much more frequent degree of variation versus their average price or range of movement. This means that an asset with a frequently-moving range is highly volatile.
- Revenue Growth: This refers to an asset’s total earning in a given period, which can be a month, year, five years, or beyond.
- Profit margin: This is the profitability metric that all assets have.
- Return on Invested Capital (ROIC): This is the company’s actual earnings for every capital it invests in operations. The formula of operational costs over invested capital yields an asset’s ROIC.
- Earnings Per Share (EPS): Earnings per share is divided by the number of outstanding shares.
OCBC RoboInvest also rebalances your portfolio automatically if you activate this feature. You’ll receive an email notification about the recent rebalance it did and what it changed. The rebalance feature is helpful to make sure you don’t lose too much on a poorly-performing asset and maximize your returns by having an automatic investment on a fast-growing asset.
All OCBC RoboInvest users have to register for an OCBC deposit account. This allows the robo-advisor to auto-debit it when it rebalances your investment account. However, it will not perform auto-debits if you disable this feature. This means that your OCBC deposit account becomes a direct-debiting facility you can use when the robo-advisor requests to rebalance or shows you investment opportunity notifications from the OCBC Digital Banking app.
Invest In Themes You Care About
OCBC RoboInvest remains competitive against other robo-advisors because you have 36 portfolios to choose from. Each one of them has more than just one asset class in various financial markets to meet their respective investment objectives in any financial situation . Here are some of them below.
1. Electric Vehicle: Invest in Fast-Growing US Smart Car and EV Manufacturers
Minimum deposit required: USD $8,000
OCBC Bank’s EV portfolio consists of the country’s top electric vehicle manufacturers, which may include well-known company stock and assets. Currently, the world’s EV market continues to grow thanks to consistent and high-quality developments in the industry.
It requires a minimum deposit of USD $8,000 and rebalances quarterly. In addition, OCBC lists this portfolio as of high risk given that equities make up more than 90% of its assets. Investors in this EV portfolio must understand the investment risks involved
2. Cyber Security: Invest in US Cyber Security Development Services
Minimum deposit required: US $5,000
Cybersecurity is a fast-growing tech industry that has consistent potential to grow in any investment portfolio. While it is a far cry from a future world portfolio, US cybersecurity is at the industry’s forefront. At present, its price performance isn’t far from reach for many investors worldwide.
OCBC RoboInvest has various cybersecurity companies in this custom-made portfolio. Investors must provide a minimum investment of USD $5,000 to use it.
However, keep in mind that this is one of the highest-risk thematic portfolios in its selection due to its high equity-to-cash ratio.
3. Australian REITs: Invest in Australia’s Rapidly-Expanding Real Estate
Minimum deposit required: AUD $2,000
Australia’s property market continues to increase in value at present. You can potentially increase the value of your investments by using OCBC’s Australian REITs portfolio, a relevant fund to this growth.
Real estate markets have always been a reliable security or financial instrument despite having average to slightly slower growth than their fast-paced counterparts in any country. Australia’s REIT industry shows strong figures for property purchases and management, making this portfolio a huge must for anyone with the appetite for its high risk profile built with equities.
4. China Growth: Invest in China’s Tech Center, Equities and ETFs
Minimum deposit required: USD $100
China is one of the countries at the forefront of cutting-edge technology. It hosts various manufacturing operations for many major US and European companies. Plus, it has many world-renowned tech brands, such as Huawei, Tencent, and Alibaba.
Many investors and analysts are positive about China’s enormous role in world tech, making them a valuable part of OCBC RoboInvestor’s thematic portfolios. In addition, you only need USD $100 to invest in this collection of China tech equities and ETFs.
5. Dogs of the Dow: Invest in ETFs Following the Dow Jones Industrial Average
Minimum deposit required: USD $3,500
The Dow Jones Industrial Average is an average of the share prices of 30 large U.S. companies. It is measured daily at the New York Stock Exchange and the Industrial Average is a term that is sometimes used to refer to the index. It has a primary focus on blue-chip companies that perform highly, and many portfolios, including Dogs of the Dow, use it as a reference in making their investments.
The Dow Jones Index, and the Dogs of the Dow portfolio from RoboInvest, includes holdings from Coca-Cola, Johnson & Johnson, General Electric, and American Express. Despite being a perceivably low-risk investment, this portfolio has a high-risk rating because of its extremely huge equity proportion.
6. Gen-Z Winners: Invest in Internet, Video Game, and Digital Payment Companies
Minimum deposit required: USD $1,000
The post-millenial industrial space involves many growing digital companies and startups with cutting-edge innovations that can result to new technological growth. The Gen-Z Winners portfolio focuses on equities focused on companies already offering next-generation digital services in fintech, video games, and other internet-based services.
Investors in the Gen-Z Winners will have holdings from various internet, video game and digital payment ETFs, such as VanEck Vectors Video Gaming and eSports ETF, Amplify Online Retail ETF, and ETFMG Prime Mobile Payments ETF. Equity balance is much higher than this portfolio’s cash component, making this a high-risk investment.
7. Stable US Industrial Giants: Invest in Stable Companies in the US Industrials Sector
Minimum deposit required: USD $3,500
Low volatility is a crucial asset component because it guarantees the most favorable conditions for company growth. The Stable US Industrial Giants portfolio from RoboInvest focuses on US industrial companies with very low to low volatility in the last five years and beyond. The portfolio’s assets have high market caps, valuation, and capital appreciation potential.
Despite the portfolio’s focus on stability and low volatility, the portfolio invests much more on equities than cash. Investors must make sure they understand that this is still a high-risk portfolio.
8. Metaverse: Invest in The Future of Internet Social Technologies
Minimum deposit required: USD $10,000
This portfolio focuses on the Metaverse-supporting companies and assets that will create the virtual world and introduce innovations that will cement its existence. These include holdings from AMD, Qualcomm, NVIDIA, Apple, and Microsoft holdings. Metaverse has one of the highest minimum deposits required with a high risk profile in this list.
RoboInvest developers have included a strict Quality, Value and Momentum (QVM) methodology to help optimize the portfolio’s rebalancing in the best possible way. Plus, it is actively monitored and rebalanced every quarter.
9. Asia Tech: Invest in Asia’s Finest Tech Companies
Minimum deposit required: USD $6,000
To date, this is one of RoboInvest’s highest-performing assets good outlook on its future or likely performance. Asia Tech focuses on Asia’s information technology industry and invests in various companies from China, Taiwan, Japan, and India, such as Taiwan Semiconductor, Pinduoduo, JD.com, Sony, and Infosys.
Outlook for Asian IT markets has profitability on average with its high flexibility in developing and adopting new technologies. However, RoboInvest classifies this portfolio’s risk as high due to its enormous 90%-plus allocation on equity than cash.
10. Impact Investing: Invest in Environmental Technologies and Developments Worldwide
Minimum deposit required: USD $100
Economic, social, and governnance (ESG) companies focus on introducing sustainability in both their company performance and environmental impact. In addition, some ESG companies respond positively to all economic and environmental improvements that their company can handle to improve their respective operations.
RoboInvest’s Impact Investing portfolio has a high risk profile and invests in iShares MSCI USA ESG Select, Invesco Water Resources ETF, and Xtrackers MSCI Europe Hedged, to name a few.
Core Portfolios Available
OCBC RoboInvest understands that each investment involves risks. You can mitigate them by assessing your risk appetite and choosing any of these six core portfolios available.
- Defensive: This is a low risk portfolio that helps you maintain yoru capital and expose your portfolio to less risk while identifying conservative and protective growth opportunities. You’ll mostly find fixed-income assets and equities in this portfolio.
- Cautious: The Cautions portfolio leans towards adequate profits without sacrificing your capital to risks and other possible downsides. Once again, fixed-income assets and equities mostly make up this core portfolio.
- Balanced: Diversification with average risk mitigation gives Balanced portfolios better growth opportunities that exposes capital to growth opportunities with limited risks. In this portfolio, bonds, equities, and gold help achieve this excellent balance.
- All Weather: This portfolio uses a trading or investment strategy that tries to weather all economic situations by having a diversified asset of fixed income assets, equities, gold, and a handful of bonds for any downturns.
- Growth: Maximizing growth using your capital signifies an investor’s confidence in an industry’s growth. However, it requires some big risk tolerance because it involves long-term financial plans with a high equity allocation balanced by bonds and gold.
- Aggressive: The highest level of risk appetite will find comfort in this aggressive portfolio. Investors use a global portfolio of various assets and equities plus some gold to achieve its aggressive growth investment objectives.
Our Verdict on OCBC RoboInvest Review
OCBC RoboInvest is an excellent robo-advisor with highly-competent features and portfolios that distinguishes it in the market. Its 30-plus and growing portfolio numbers plus its beginner-friendly approach to robo-advisor investing makes it accessible for everyone. While you might find some high-priced minimum portfolio deposits, many of the portfolio themes have a small USD $100 deposit to get started.
In addition, advanced investors can take the helm and turn off automatic rebalancing, allowing them to receive financial and investment advice instead. Having access to an advisor 24 hours a day even during weekends is a great plus, which is why we are giving RoboInvest a high recommendation if you want the best potential to grow your money.
Who Should Use OCBC RoboInvest?
We highly recommend OCBC RoboInvest to any beginning investors looking to grow or preserve their asset values. Advanced investors will surely find RoboInvest a great addition because of the robo-advisor’s algorithm and portfolio themes.
How to Apply For OCBC Robo Invest
- 18 years of age and above
- OCBC account holder
- Have OCBC Digital Banking access
- NRIC for Singaporeans and Singapore PRs
- Passport and a valid pass (e.g. Employment Pass (EP) or S-Pass or Student Pass) for foreigners
- Include any one of the following documents that shows your residential address
- Phone bill
- Half-yearly CPF statement
- Any bank statement
- Log into your OCBC Digital Banking account
- Select the focused theme and risk profile you’re comfortable with
- Select your portfolio and click Invest Now
- Enter the amount you want to invest and click next
- Confirm your deposit details and click next
- Review all the details and data you’ve entered before confirming.
Let’s Learn More About Robo-Advisors
What Are Robo Advisors?
Robo-advisors are software that offer automated investment advice. They analyze investment data and make decisions with the goal of outperforming market benchmarks. many robo-advisors also manage portfolios of investments. They are essentially algorithms that offer financial advice and help people manage their money. Generally, robo-advisors work 24/7, making them accessible to everyone.
How Are Robo Advisors Much More Efficient Than Traditional FAs?
Traditional financial advisors are limited to offering investment advice on stocks and bonds heavily based on commissions. On the other hand, robo advisors can offer financial advice or automatically rebalance your portfolio based on data. Essential, it has a greater level of transparency allowing it to offer you better investment options. Plus, they create a more personalized investment experience.
Are Robo Advisors Affordable?
Fee-wise, traditional financial advisors take a higher fee and charge a percentage of the assets invested by their client. Robo advisors take a lower fee and charge a percentage of the assets invested by the client. They do not receive any commissions and are accessible beyond working hours, allowing them to optimize and fully improve your portfolio against any changes in the market.
Are All Robo Advisors Similar?
Robo advisors are similar in that they offer automated investment advice, but they differ by fees, add-ons, and investment strategies. For example, OCBC RoboInvest has 30-plus portfolio themes including 6 core portfolios tailored to various investor’s risk appetites. Other robo-advisors might have more or less themes and core portfolios. In addition, they will most likely have varying commissions, investment advice, and QVM/algorithms.
Can I Have Enormous Profits From Robo Advisors?
Robo-advisors make it easier for new investors to have a more streamlined experience. However, no robo-advisor can guarantee that it can generate profits for investors because of the ever-changing value of stocks, assets, and other financial instruments. Investors should see robo-advisors as tools and technological means to take advantage of sudden changes by using the advisor’s automated features.
Our Final Thoughts
OCBC RoboInvest is one of the most cutting-edge and highly-useful robo-advisors in Singapore. Investors can take advantage of its low entry fees and access to global-themed portfolios with huge performance potential. Furthermore, it ptovides investors with a streamlined experience for beginners and flexible features for advanced investors.
- OCBC RoboInvest uses the expertise of the bank’s most talented financial advisors to provide investors with top-notch financial advice and auto-portfolio rebalancing
- OCBC RoboInvest has 30-plus portfolio themes that focus on various global market segments and 6 core portfolios designed around any investor’s risk appetite
- It has an auto-rebalancing feature allowing you to take advantage of sudden market changes
- Both beginners and advanced investors can take advantage of RoboInvest’s high-quality features.
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