For real-time updates, do join our:
- Telegram Group: t.me/theinvestquest (or search “The InvestQuest” on Telegram)
- Whatsapp Broadcast: Just send “Hello IQ” to +65 8840 2520
- Facebook Page: The InvestQuest | Facebook
- LinkedIn Page: The InvestQuest | LinkedIn
Article Outline
Endowus Fund Smart has reduced access fees to 0.3% p.a.
Endowus Fund Smart is a SUPER CHEAP platform to buy unit trusts!
Summary of Our Top Picks by Category
Top Unit Trusts for Cheap & Diversified Exposure
Top Unit Trusts for Emerging Markets/Asia
Top Unit Trusts for China
Top Unit Trusts for Fixed Income
Our Take on Endowus Fund Smart
Disclaimers: The information made available in this article is meant for information purposes only. Such information does not constitute financial or investment advice. You will not rely on the information in this article in making any decision with regard to your finances or investments. We do not undertake or represent to any person to ensure the correctness and completeness of any information or data, nor to update them for currency with the passage of time. Our analyses, opinions and views are subject to change without notice, and we do not undertake or represent to any person with regard to their correctness, completeness or currency. Past performance may not be an accurate or complete indicator of, and does not guarantee, future performance. This advertisement is not reviewed by MAS.
Endowus Fund Smart has reduced access fees to 0.3% p.a.
Endowus Fund Smart has now cut platform access fees to 0.3%! The platform access fee was previously dependent on funding type: 0.6% for Cash savings, and 0.4% for CPF & SRS. Now, it’s simply 0.3% for all funding types for a single fund portfolio.
This is a VERY BIG DEAL. Because now Endowus Fund Smart is the one of the CHEAPEST platforms to buy unit trusts. This holds true for an awe-inspiring 95% to 100% of the unit trusts it carries when compared to competitors like DollarDex, FSMOne and POEMS.
We’ve always found Endowus Fund Smart compelling (see here), but this move really puts it in a whole ‘nother league.
To understand why Endowus is such an attractive platform, read below.
Endowus Fund Smart is a SUPER CHEAP platform to buy unit trusts!
When purchasing a unit trust, there are three fee components to think of:
- Platform Access Fee: What platforms charge you for the service they provide (i.e. access to the unit trusts).
- Total Expense Ratio: What unit trust managers charge you for managing the unit trust & its associated expenses.
- Trailer Fees: What unit trust managers give back to the platforms, in return for the platforms distributing there. In most cases, trailer fees are kept by the platforms – but Endowus Fund Smart is an exception!
Now let’s compare Endowus Fund Smart versus popular fund platforms for these different fee components.
Now comes the next question: Which unit trusts are attractive to buy? Below, we explore our top picks.
Summary of our Top Picks by category
In the following sections, we show our top unit trust picks for
- Cheap & Diversified Exposure
- Emerging Markets/Asia Exposure
- China Exposure
Here’s the summary of our top picks, plus the fees being charged when you buy them on various platforms. What’s shown below already factors in Endowus Fund Smart’s trailer rebates. We picked these funds after screening for the fund’s size, cost-efficiency, historical risk-adjusted performance, as well as length of time since fund inception. Several of them were actually mentioned in our Ultimate List of Mutual Funds for SG Investors (published back in Sept 2020 before Endowus Fund Smart was launched).
What follows are more details on the individual funds!
Top Unit Trusts for Cheap & Diversified Exposure
If you just want very cost-efficient and diversified exposure, we like
- Dimensional Global Core Equity Fund
- Dimensional World Equity Fund
- Dimensional Emerging Markets Large Cap Core Equity Fund
See their features below!
Top Unit Trusts for Emerging Markets/Asia
For those who would like a greater weightage towards emerging markets (EM) in their portfolios, here are our top choices for EM-focused unit trusts.
- Schroder Global Emerging Markets Opportunity Fund
- First Sentier Dividend Advantage Fund (for Asia ex-JP)
- Schroder Asian Growth Fund
See their features below!
Top Unit Trusts for China
If I have already constructed a diversified portfolio using the above, why would I be interested in unit trusts for Chinese equity exposure?
Two points.
First, Chinese equity valuations are more interesting now because of the pull-back. We highlight these unit trusts in case some of our readers would like to tactically overweight their China exposure.
Second, China equities also tend to be underrepresented in global equity indexes. Just a simple measure: China constitutes 17% of the world GDP (World Bank figures, USD terms) but only makes up 4% of the MSCI All Country World Index. As a comparison, USA constitutes 25% of world GDP but makes up 60% of the MSCI All Country World Index.
Our top picks for China exposure:
See their features below!
Top Unit Trusts for Fixed Income
At this point in the market cycle, bond yields are very low! So at this juncture we prefer to use cost-efficient cash management accounts like Endowus Cash Smart which are invested in short dated investment grade bonds. We see poor relative value in taking duration or credit risk at current valuations.
Conclusion – The Reason Why We Like Endowus Fund Smart
We’ve always liked Endowus Fund Smart. Here’s the takeaway from our previous article:
Endowus Fund Smart provides a DIY investment option via a curated list of unit trusts and offers benefits not normally available to retail investors. As a result, you can simply focus on the most crucial part of fund management – deciding exactly where you want to invest your money.
Now with the reduction of platform fees to just 0.3%, Endowus Fund Smart is to us the clear leader for investors who want to buy unit trusts.
If you are keen to try out the Endowus platform, Endowus has given our readers a promo code that entitles you to have S$10,000 managed for free for 6 months ($20 equivalent).
Click Here For Promo Code
hello IQ, as you know we can save 10bps (30bps for single vs 40bps for multi fund) from the recent reduction in endowus access fee…
do you think this is worth the effort in long run if we simply have discipline to rebalance twice/year manually?
Hey Ryan,
The answer really boils down on the individual, since each of us will place a different value on the cost saving vs time saving (from having to manually rebalance and from reading up to DIY your own fund portfolio). Endowus Fund Smart works best when the user more or less knows what he/she wants and is confident is DIY-ing the portfolio.
It is also important to put the 10bps cost savings in context of the intended portfolio size. For example, 10bps on a S$100k portfolio equates to $100 per year. For someone who prefers a more hassle-free approach and spend his/her time elsewhere, I think the cost isn’t’ too exorbitant as you pointed out and sticking to the model portfolios is probably a better idea.
This is good analysis. Though, if individual funds need to be selected, one should go for ETFs and via IBKR. Endowus should be used for its Asset Allocation feature, i.e 0.6% access fees. Yes 0.3% is attractive but without asset allocation feature, its mighty costly. I hope the 0.6% access fees for asset allocation is reduced by endowus