So one of the relatively bigger finance news these few days is the launch of a new 100% global equity portfolio by Syfe, called the Equity100 portfolio.
As one of the early adopters of Syfe, we are definitely excited when we hear this news.
One of the reason why we are excited is for this new 100% equity portfolio is because we are currently invested in the existing global equity portfolio by Syfe. However, due to its built in risk management portion, the portfolio will auto rebalance itself during period of high volatility, resulting in a higher allocations to bonds.
Here’s our current global equity portfolio composition with risk management:
What we would have preferred instead, is for a full equity allocation regardless of the market volatility. While lower risk is of course better for most investors, for Mrs Budget and myself, we are able to stomach more risk on our portfolio as we treat our CPF as the “bond” portion of our portfolio.
Hence for our roboadvisor, we would very much prefer a full equity portfolio – and the new 100% global equity portfolio Equity100 definitely answers that for us!
According to the announcement, Equity100 invests in ETFs which holds positions in some of the biggest names in the world now: the Amazons, Facebooks and Alibabas of the world.
Here’s a quick look at the portfolio allocation:
Equity100 – Lower Risk And Cheaper Alternative For Us To Buy US Technology Growth Stocks
The same reason why we are putting our money into the Syfe REIT+ portfolio, the Equity100 provides us with an affordable and professionally managed solution to gain access to all the US equity counters which are probably too expensive for us to buy individually now.
Take a look for Amazon for example, of which Equity100 has about 5.21% holding now – Amazon just reached another ATH yesterday, hitting over USD2800. Apple too is at its all time high, and while these are counters that we would absolutely love to hold individually, it would be too expensive for us to buy them now.
Hence the Equity100 portfolio provides us a “lower risk” alternative to holding onto these high growth stock and riding on the potential upside.
While there are no active “risk management” for Equity100 (shifting to and fro from equities and bonds), Equity100 touts a smart beta strategy, which means the portfolio might adjust their allocation to ETFs with higher potential returns due to market movements.
For example, say the next big theme is EV, I’d think Equity100 will add some allocation on ETFs with this theme and bring up the overall return of the portfolio.
Because of these reasons, Mrs Budget and I have added a new Equity100 portfolio and we will be doing a monthly contribution into this portfolio. We have contributed our first S$1,000 into Equity100.
Monthly DCA Into Syfe REIT+, Equity100 and Syfe Global Equity
Of course, one of the main question that even we ask ourselves is that, with 3 portfolios available on Syfe now, how should one DCA monthly into Syfe?
While there are no right answer to this, we can share our point of view.
For Mrs Budget and myself, we treat Syfe as our “emergency fund” or a joint portfolio that we may use for future purposes, for example, paying for our kid’s education, or simply as a supplementary retirement fund.
Individually, we also have active bank balances which serves as our day to day expenditure wallet, as well as our war chests.
Hence our time frame for Syfe is for at least 10 years. Maybe more. And we probably wont be touching it unless absolutely necessary.
So for Syfe, we set aside S$1,000 each for a monthly DCA, hence we are allocating a total of S$2,000 monthly to Syfe.
The S$2,000 will be split according to the following ratio:
|Portfolio||10Y Return||Monthly DCA|
|Global Equity Portfolio||9.4%||S$500|
Currently, we will be allocating S$1,000 (50%) allocation to the Equity100 portfolio, and S$500 (25%) each to the Global Equity Portfolio as well as the REIT+ portfolio.
This is in line with what we mentioned previously, where we are looking to increase our overall exposure to US stocks as we are currently slightly overweight in Singapore stocks now. Hence taking up the Equity100 portfolio on Syfe will tilt our allocation to US stocks slightly.
Depending on the individual portfolio’s annual return, as well as our own portfolio’s composition where we actively invest in individual stocks, we may shift our Syfe monthly allocation among the 3 portfolios.
As we are actively looking around for US stocks now, and if we end up with an overweight position in US stocks, we may then shift our Syfe allocation to get more Singapore REITs.
With the monthly S$2,000 contribution and a 10% total estimated return, hopefully we will be able to see a decent return 10 years later, estimated at an ending portfolio of S$450,296 with a total contribution of S$240,000.
Will we be able to hit that returns? Only time will tell! And 10% PA is a very aggressive and optimistic target! And the past 10 years we are in a bull market, which has probably ended.
Looking to invest via Syfe? You can use our referral code: SRP6X8B8Y when you create an account.
We would both get $10 to $100 depending on your first deposit amount, and you’d receive your bonus within 5 business days.
Like our Facebook Page for more articles like this: Mr Mrs Budget