Syfe vs. StashAway vs. Endowus

Syfe vs. StashAway vs. Endowus: Comparing the 3 Popular Robo Advisor in Singapore

Robo-investing is flourishing in Singapore due to the pandemic and technological advances. You may wonder if the Robo-advisors in Singapore can perform superior investing performances and which one is better among other Robo advisors if they can do the job. Read more on Robo Investing in Singapore.

How A Robo Advisor Works & Who is It For

Robo-Advisors use automated systems of algorithms to process clients’ requests. They perform the functions: collecting data; analysis; making investing recommendations; monitoring portfolios; rebalancing.

1. Collect data

The program asks you a set of questions. They may include:

  • Financial goals: What are your investing purposes for retirement, business planning, education, travel, or down-payment for-a-home purposes?
  • Time horizons: How long will you take down investment, five, ten, or twenty years?
  • Risk tolerance: Can you put up with the ups and downs of your assets during the investment period? How much loss can you tolerate: 5%, 10%, or 20%?

The information requested is the same as what a human, financial advisor asks you if you seek financial advice.

2. Analyze

Using artificial intelligence and the modern portfolio theory(MPT) approach, Robo advisors analyze clients’ data provided and process and compare solutions available. 

3. Investing recommendations

A Robo advisor presents investing recommendations and solutions based on your details and preferences. Several scenarios of choices are also available to you.

4. Monitor Portfolios

Suppose you agree with the investing recommendations and fund your account with the investing company. Robo advisors will invest and monitor your assets regularly.

5. Portfolio Rebalancing

Robo advisors keep a watch on the proportions of your portfolio assets. They sell and buy assets to keep the balances of asset classes when market conditions change. Besides a lump sum investment, Robo advisors also use regular contributions to balance portfolios.

6. Passively-managed investing style

Once you agree to the investment plan, a Robo advisor will set up a portfolio tailored to your preferences, risk levels, and time horizon. It will monitor and adjust your asset mix if necessary. 

The whole investing process is similar to an ETF’s or Index fund’s because Robo-Advisor carries out the instructions as formulated by clients.

 

Why Do People Choose it?

Robo Investing provides convenient and easy-to-navigate services to clients just as you would draw out your money from your account from an automatic teller machine(ATM) rather than queuing up for half an hour inside a bank. People choose it for the following reasons:

  • Clients are busy:
    A Robo advisor service may be a good option if you have little time investing or financial planning. The automated digital platform provides one-stop services from consulting to portfolio balancing. Robo Investing is a fit for people who like hassle-free and hands-off investing styles.
  • Simple planning:
    If you have fewer goals that are likely to conflict with your other goals in priority, Robo advisors may give you straightforward and quick-to-implement solutions. The benefit is you save time and effort in your planning.
  • Beginner and young investors:
    Robo advisors suit new investors unfamiliar with investing and sophisticated planning. Young investors having a learning curve in investing can start with standardized and straightforward planning tools, such as Robo Investing, to reduce risks.
  • Small sum planning:
    The advantage of Robo Investing is you can use the service for a smaller sum than the traditional service. Financial institutions offer the Robo advisor service to retail investors a smaller sum of money. More and more people can get professional services.
  • More than that, brokerages fees for Robo investing are lower than the fees for traditional human services. That is why Robo advisors have become popular among others.
  • Diversification:
    Most of the assets Robo-Advisors invest in are exchange-traded funds and index funds. The funds invest in companies’ stocks and bonds from indexes covering most markets. Thus, your portfolio is well diversified from the risks incurred by individual companies.

 

How to Spot the Right Robo Advisor

Here are the tips for helping you choose the right Robo advisor:

1. Know your goals

You should determine your investment objectives beforehand and tell a Robo advisor to carry them out. Some people have several goals, like retirement, saving for college tuition, or starting a business. You should specify your goals no matter how many you have so the right Robo advisor can regularly allocate and rebalance your portfolio.

2. Advise on the goal planning

A Robo advisor works with you and tells you constraints, such as risk tolerance and time horizon, before reaching your goals. For the first one, you know to what extent your investments may go down, and for the second one, you need how long to reach your goals based on usual scenarios.

3. Understand fees and other requirements

Robo advisors’ fees vary based on services and investment amounts. Some do not charge but collect a flat fee per month or yearly, while some Robo advisors charge a fee based on an investment amount. If you need a human advisor service, you may pay an additional cost over phones or live chats.

4. Check the ease of use

Most Robo advisors provide free training to potential and existing clients about using their Robo investing service. You may learn which one is the best fit to navigate your success. It’s essential because you have more control over your assets as your joystick to investing, and you may adapt more technologies in future investing.

5. Ensure your goals are well in place

You must ensure your goals are in a proper place. The investment recommendations by a Robo advisor have precisely laid out your needs and achievable solutions so you can reach the goals step by step. The Robo advisor will execute the tailor-made plans to sell and buy based on your objectives and strategies.

6. Dig deep into a Robo advisor’s offers

Offers a Robo advisor affects your portfolio performance. They provide low-to-zero charge investment funds to lower the costs. However, you should know which types of investment tools are available. The more a Robo advisor offers more services, the more likely you will benefit. Of course, you have to spend some time learning.

7. Review a Robo advisor’s performance

You may regret it is too late to find a Robo advisor’s performance has gone awry. Robo advisors are happy to have regular reviews about your performance, but you may need a human advisor to solve complicated financial issues. You may consider having one at that time.

 

Pros and Cons of Robo Investing

Pros

  • Low cost of investing

Robo Investing provides an affordable way for retail investors with access to tailored-made financial services for high net worth investors. Retail investors may reduce the risks and the chance of loss if they get advice from professionals. In other words, the possibility of making a return may increase.

  • Professional services

Clients benefit from the regular monitor and rebalance by all-around computer, so the portfolio asset mix and performance align with clients’ goals. 

Cons

  • Simple investing technique

Robo advisors may not solve clients’ sophisticated financial goals by using one set of investing formulas. Suppose a client wants to do active investing like stock or futures picking within his portfolio. The Robo Advisor may not cater to a client’s sophisticated demands.  

  • No human contact

A cold machine may not know a client’s entire financial situation. A human advisor may understand more through interactions with clients about their emotions and what they want from investing. It makes a human advisor better suited for a client’s needs.

A computer system may not fully understand why parents try hard to maximize their assets for disabled children and want to preserve the hard-earned money from any loss. So the computer may not provide the best solutions to the parent’s financial circumstances.

  • Lack of close contacts 

A Robo advisor cannot act in a proper and all-round response to changes in aggressive clients’ financial conditions in place of a human advisor. Regular and humanized interactions are necessary ingredients to the process of successful financial consulting.

 

Syfe Logo

Syfe: Best for Professional and Sophisticated investors

Syfe is a Singapore-based financial technology company. Licensed from the Monetary Authority of Singapore(MAS), it provides packaged products to clients of different investing needs using Syfe’s AI algorithms methodology. Clients can buy exchange-traded funds (ETF) and stocks(the newest service) on its online platform.

 

Features

Based on the factor model developed by Nobel Prize winners: Eugene Fama and Kenneth French in 1992, Syfle develops investment portfolios using ETFs, such as equity, bond, and gold. They differ in risk levels from high to conservative.

4 flagship ETF portfolios: 

  1. Core equity100: 100% exposure to equities for high-risk investors opting for long-term capital gains
  2. Core growth: about 70% dedicated to equities; 25% to bonds; and 5% to gold for moderate-to-high-risk investors opting for long-term capital growth
  3. Core balanced: 50% dedicated to bonds; about 40% to equities; 10% to gold opting for moderate-risk investors for long-term growth
  4. Core defensive: about 70% dedicated to 70%; 20% to equities; 10% to gold opting for low-risk investors with financial goals

1 REIT+ Portfolio

REIT+ is the first ETF tracking the iEdge S-REIT Leader’s Index. The index covers the most prominent real estate investment trusts listed in the Singapore stock market, for example, Ascendas Real Estate Investment Trust, Mapletree Commercial Trust, CapitaLand Integrated Commercial Trust.

5 thematic investment portfolios:

  1. ESG and clean energy investing: The global portfolio focuses on investing in companies meeting consistently environmental, social, and corporate governance standards(MSCI ratings). It emphasizes clean energy and sustainable resources like water. It is a very high-risk investment class.
  2. Disruptive technology: The fund invests in innovative companies specializing in artificial intelligence, cloud computing, robotics, esports, eCommerce, and cybersecurity worldwide. It is a very high-risk investment class.
  3. Healthcare Innovation: The fast-growing sectors of the healthcare industry are the targets of the investment fund. The sector includes pharmaceuticals, genomics, biotechnology. It is a very high-risk investment class.
  4. China growth: It captures China’s growth in the recent decades by investing in fast-growing companies like Alibaba, Tencent. It is a high-risk investment class.
  5. Global Income: The portfolio invests in bonds from investment-grade to high-yield bonds. It also focuses on the bond markets from China and other emerging markets. It belongs to an intermediate risk class.

Customed portfolios

Syfe offers do-it-yourself(DIY) portfolios services for clients to choose investment portfolios according to their needs, investment preferences, and time horizons. You can choose among more than 8,000 ETFs selected by Syfe to build up your choice.

  • Cash+ Portfolio

The cash investments offer a client about 1.55% p.a. You can transfer and withdraw the funds in the account without any restrictions. It is an alternative to a bank deposit offering little interest. 

  • US stock service

Syfe newly adds US stock trade service. Besides ETFs, you can buy fractional shares on their platform now. In addition, the first 5 trades are free.

 

Pros and Cons

Pros

  • 3 advantages: No minimum investment amount required; No brokerage fees; Portfolio auto re-balancing services; Dividend reinvesting.
  • Syfe offers comprehensive services: The ETF products cover equities, bonds, commodities, REITs, multiple sectors, geographies, customed portfolios, and cash management services. 
  • The products available cover from highest to lowest risks. Investors have vast choices. 
  • Stock trade clients are under the protection of SIPC(Securities Investment Protection Corporation, US) for up to US$500,000. The protection states stock investors can claim compensation of up to US$500,000.
  • Clients get free consultations from Syfe’s investment advisors, and those with S$20,000 or above can get personalized advice based on individual goals in addition.

Cons

  • Clients have only two asset genres available: ETFs and stocks. Though investors can use ETFs and stocks to invest, other investment tools like options, warrants, and derivates are unavailable.
  • Personalized consultation services are available to clients with an account of over S$20,000 only.
  • Stock clients have to pay a charge after the first 5 trades; however, most brokerages waive the fees for all stock trades.

Returns

Portfolio 5-year return
Core Equity100 16.8%
Core Growth 12.93%
Core Balanced  8.38%
Core Defensive 5.40%
ESG, Clean Energy 23.40%
Disruptive Technology 28.70(3-year only)
Healthcare Innovation 19.66%
China Growth 14.12%
Global Income 4.73%
REIT+ 64.90%
Cash+ 1.5%

 

Stashaway Logo

StashAway:  Best for Risk-Conscious investors

Established in 2016 in Singapore and licensed by the Monetary Authority of Singapore(MAS), StashAway is a FinTech company offering investment services on its platform to investors. Using innovative technology and artificial algorithms, StashAway develops investment portfolios using ETFs of equities, bonds, and gold. Besides, clients can buy term life insurance.

 

Features

  • By adopting the goal-based approach and proprietary investment strategy, StashAway develops the [email protected] model(Economic Regime-based Asset Allocation), through which the company creates unique ETF portfolios in US dollars.
  • Actively using risk management strategies in long-term investing, StashAway aims to maximize returns with minimum risk.
  • StashAway uses a value-at-risk approach to measure performance and build up 12 portfolios with stock and bond combinations.
  • The portfolios track the MSCI World Equity Index and the FTSE World Government Index.
  • The 12 thematic portfolios are the StashAway Risk Indexes 1. 6.5% with 5% stocks and 95% bonds; 2. 5% with 10% stocks and 90% bonds; 3. 10% with 20% stocks and 80 bonds; 4. 12% with 28% stocks and 72% bonds; 5. 14% with 33% stocks and 67% bonds; 6. 16% with 40% stocks and 60% bonds; 7. 18% with 45% stocks and 55 bonds; 8. 20% with 43% stocks and 57% bonds; 9. 22% with 40% stocks and 60% bonds; 10. 26% with 75% stocks and 25% bonds; 11. 30% with 90% stocks and 10% bonds; 12. 36% with 100 stocks and 0% bonds.
  • The StashAway Risk Index percentage refers to the 99% probability of not losing percentage for a portfolio. For example, the portfolio – StashAway Risk Index 6.5% illustrates the 99 probability the portfolio will not lose more than 6.5%. The 12 risk index percentages indicate the maximum loss of your portfolio with a 99% probability.
  • The income portfolio: Denominated in the Singapore dollar, it invests in Government bonds, agency bonds, investment-grade corporate bonds, real estate investment trusts, and high dividend yield stocks listed in the Singapore stock exchange.
  • StashAway also offers group term life insurance with total and permanent disability of up to S$500,000 coverage without any medical check-up.
  • A StashAway Simple cash account earning 1% p.a. is available to clients.

 

Pros and Cons

Pros

  • An innovative approach to investing: StashAway uses AI algorithms and value-at-risk metrics to develop the [email protected] model in investing. The 12 thematic portfolios developed by the model make investors choose products according to risk preferences.
  • The add-on service of life insurance, besides income portfolio, enhances StashAway’s image as a comprehensive financial services house.
  • Invest your SRS funds with StashAway: You can use tax-deductible funds to invest in the thematic, income, or cash account and may earn more than others.

Cons

  • Confusing product categories: Investors may be confused with the rankings from the 12 thematic portfolios and may find the index percentages hard to understand and clearly defined. They may choose to find an easier one to do the investing job elsewhere.
  • Income portfolio investors are only accessible to the Singapore market and local currencies. It may lead to more market and currency risks.

 

Returns

SRI = StashAway Risk Index; S = Stocks; B = Bonds

Portfolios Returns Benchamarks Inception dates
SRI 6.5%(5%S, 95%B) 3.3% 3% July 19, 2017
SRI 8%(10%S, 90%B) 4.70% 3.6% July 19, 2017
SRI 10%(20%S, 80%B) 6.6% 4.8% July 19, 2017
SRI 12%(28%S, 72%B) 6.5% 5.7% July 19, 2017
SRI 14%(33%S, 67%B) 7.0% 6.3% July 19, 2017
SRI 16%(40%S, 60%B) 7.8% 7.1% July 19, 2017
SRI 18%(45%S, 55%B) 8.7% 7.6% July 19, 2017
SRI 20%(53%S, 47%B) 9.2% 8.5% July 19, 2017
SRI 22%(60%S, 40%B) 11.5% 12.5% Aug 15, 2019
SRI 26%(75%S, 25%B) 11.1% 11.5% Aug 16, 2018
SRI 30%(90%S, 10%B) 12.3% 12.8% Aug 16, 2018
SRI 36%(100%S, 0%B) 12.2% 13.7% Aug 16, 2018

 

Endowus Logo

Endowus: Best for Beginner and Risk-Averse Investors

A fintech company launched in 2019, Endowus builds up data-driven portfolios to maximize returns and minimize risks. To diversify assets across global securities markets, the company looks for solid growth opportunities.

 

Features

  • Endowus develops 6 AI-driven investment models based on Nobel Prize academic theories with various risk levels. ETFs are investment tools used to create models.
  • The 6 portfolios comprise stocks and fixed income with respective combinations for risk levels: 1. Very Conservative: 100% fixed income and 0% stocks 2. Conservative: 80% fixed income and 20% stocks; 3. Measured: 60% fixed income and 40% stock; 4. Balanced: 40% fixed income and 60% stock; 5. Aggressive: 20% fixed income and 80% stock; 6. Very Aggressive: 0% fixed income and 100% stock.
  • Endowus also offers 6 ESG investment portfolios based on the same methodologies.
  • One global real estate investment portfolio provides high-income streams and capital appreciation.
  • A technology portfolio focuses on global technology companies to capture growth.
  • China equities: The portfolio invests in China’s onshore and offshore companies and focuses on the market’s high growth.
  • Comprehensive cash management portfolio: Enowus’s Cash-Smart series offers 3 types of cash management account services with a management fee of 0.05%: 1. Secure: It invests in Singapore bank deposits and earns 0.7% to 0.8% p.a.; 2. Enhance: It focuses on the money market funds and short-term funds in Singapore and earns 1.2% to 1.4% p.a.; 3. Ultra: The portfolio invests in high-yield money market funds and short-duration bond funds to maximize growth. It returns 1.9% to 2.1% p.a. All returns are net of fees.
  • A fund smart of more than 150 funds is available on the investment platform to investors.

 

Pros and Cons

Pros

  • Simple investment choices: Investors understand the portfolio combinations from the most aggressive to the most conservative at one shot and find it easier to choose.
  • More options available: Clients can choose funds from the Fund-Smart or portfolios designed by Endowus. It offers comprehensive options to investors.
  • Multi cash management products: The company offers 3 cash management accounts with different time horizons besides the investment options.

Cons

  • Confusing options: Investors may be perplexed by fund options available on its platform. A fund may exist on fund smart while it may be a component of a portfolio mix.  Clients may face difficulties choosing investment tools.

 

Returns 

Portfolios(CPF) Returns from Nov 2011 to Oct 2021
Very Conservative 3.2%
Conservative 5.1%
Measured 7.2%
Balanced 9.1%
Aggressive 11%
Very Aggressive 13%

 

Fees

Companies Management fees per annum Minimum investment amounts/minimum deposit
Syfe Blue: 0.65% with first-month wealth expert advice Nil
Syfe Black: 0.5% with wealth expert advice S$20,000
Syfe Gold: 0.4% with a dedicated expert S$100,000
Syfe Private wealth: 0.35% with a dedicated expert S$500,000
StashAway 0.8% Up to S$25,000
StashAway 0.7% S$25,001 to S$50,000
StashAway 0.6% S$50,001 to S$100,000
StashAway 0.5% S$100,001 to S$250,000
StashAway 0.4% S$250,001 to S$500,000
StashAway 0.3% S$500,001 to 1S$1,000,000
StashAway 0.2% S$1,000,001 and above
Endowus 0.6% S$1,000(an initial investment) to S$200,000
Endowus 0.5% S$200,001 to S$1,000,000
Endowus 0.35% S$1,000,000 to S$5,000,000 
Endowus 0.25% S$5,000,000 and above

 

How to Invest 

  • Eligibility

The requirements for the three companies are basically the same. You can open an account on the official websites or their apps from your mobile phone. 

An applicant should be a permanent resident, citizen, or foreigner aged 18 or above.

  • Requirements

Applicants can provide personal information or Singtel information to finish the process.

  • Process

You can transfer funds by PayNow, FAST, or Telegraph Transfer when an account setup is complete.

 

Why You Should Do Your Due Diligence Before Investing

As with any other investment, one should be aware of the risk they are taking. While many people consider Robo Advisor as one of the easiest ways to get started, taking precautionary measures or understanding the ins and outs may prevent huge financial mishaps. 

 

Final Thoughts

The three Robo advisors in Singapore offer the best investing services and products with no platform fee and low management fees. Syfe charges the lowest management fees and records the highest return based on the same risk level for the past periods.

  • Professional investors for Syfe due to the performance and fees
  • Risk-conscious investors for StashAway due to the sound risk management
  • Beginner and Risk-averse investors for Endowus due to the excellent performance of lower-risk products
  • You should determine your investment objectives beforehand and tell a Robo advisor to carry them out. 
  • Robo advisors suit new investors unfamiliar with investing and sophisticated planning. 

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