FREQUENTLY ASKED QUESTIONS
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Compared to other DIY investors, investing through Autowealth has several benefits:
Compared to other financial planners, investing through Autowealth has several benefits:
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We generally do not comment on other similar service providers. However, we can share that AutoWealth has the following features:
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Yes, AutoWealth has a Financial Advisors licence (Licence No.: FA100064-1) issued by the MAS and the company is regulated under the Financial Advisors Act.
In accordance with the Financial Advisors Act, AutoWealth clients’ monies and portfolio assets are held in a personal and segregated custody account at HSBC through Saxo Capital Markets, our partnering MAS-licensed financial institution that is regulated to provide custody services. This means that monies and portfolio assets legally belong to the client and are fully segregated from AutoWealth or Saxo Capital Market’s own monies and assets. Clients enjoy full protection against the insolvencies of both AutoWealth and Saxo Capital Markets.
AutoWealth help clients achieve their financial goals in 3 simple steps:
Thereafter, AutoWealth manages clients’ investment portfolios, from portfolio construction to periodic rebalancing, while clients may access their investment accounts anywhere anytime 24/7 to see their investments grow over time.
All AutoWealth investment portfolios feature a portfolio mix of Equity (Stocks) and Fixed Income (Govt Bonds), diversified across major geographical regions in the world including U.S., Europe and Asia Pacific and diversified across major industries including oil & gas, materials, industrials, consumer goods, health care, consumer services, telecommunications, utilities, financials & technology.
This means AutoWealth’s investment portfolios are generally more defensive against market turmoil and recessions than an investment portfolio that is concentrated in a particular asset class (eg. stocks) or geographical region (eg. Euro-Area) or industry (eg. technology).
AutoWealth achieves the strong diversification effect cost-efficiently through index-tracking Exchange-Traded Funds (ETFs) listed on the New York Stock Exchange and NASDAQ.
AutoWealth has a rigorous process to screen over 6,000 ETFs listed globally and select the best ETFs based on factors including diversification effect, direct holdings of underlying Bonds or Stocks, reputation of the ETF provider, ETF fund size, liquidity and expense ratio amongst other factors.
AutoWealth does not invest in Commodities due to the following:
On balance, the downside outweighs the upside of a commodity’s diversification effect.
AutoWealth does not allow fractional shares due to the following:
Idle cash earns little or zero yield. If you have no immediate need for your idle cash and wish to earn a better return, you may consider investing your idle cash through AutoWealth in 3 simple steps fully online:
Depending on your risk profile and the corresponding investment portfolio recommendations, the projected1 long-term returns net of fees and currency impact is approximately 5% to 7% per annum.
1 The projections are derived through robust financial modelling based on the past performance of the portfolio assets since 2001 where global financial market data, including major emerging markets, were first readily available. Pls refer to FAQ “What is the investment performance I can expect?” for more details.
Note: Investments always carry risks. The market value of your assets and monies may fluctuate and result in economic gains and/or losses. Please consider having a reasonably long investment period to mitigate short-term market fluctuations.
AutoWealth helps you achieve significantly better investment performance than mutual funds (unit trusts)with comparable asset allocation and risk. The well-established SPIVA Scorecard published by S&P DowJones Indices1 and other financial researches, found that 80-90% of active fund managers consistently underperforms compared to benchmark market returns over the short, medium and long term. At AutoWealth, we take a passive market-returns approach with no speculation so that you achieve better investment performance.
AutoWealth charges significantly lower fees than mutual funds (unit trusts). You only pay an annual 0.5% portfolio advisory fee on the assets under administration and an annual US$18 platform fee. Bid goodbye to expensive mutual funds (unit trusts) sales charge, admin fees, custody fees and withdrawal fees.
AutoWealth provides real-time 24/7 access to your investment portfolio with important market developments that you ought to be aware of, curated for you in simple layman English. Bid goodbye to mutual funds (unit trusts) quarterly reports and technical jargons.
Depending on your risk profile and the corresponding investment portfolio recommendations, the projected1 long-term returns net of fees and currency impact is approximately 5% to 7% per annum. The projections are derived through robust financial modelling based on the past performance of portfolio assets since 2001 where global financial market data including major emerging markets were first readily available.
You should note that the investment portfolio recommendations are intended to generate market returns over the medium to long-term and are not suitable for short-term speculation. You are welcomed to request a free financial consultation if you need financial advice for your unique financial circumstances.
1 Projections are based on robust financial modelling and past performance of portfolio assets. Although such projections are grounded on sound financial concepts, you should not assume that the future performance of portfolio assets or investment products referred to on the Platform will necessarily correspond to such projections.
Note: Investments always carry risks. The market value of your assets and monies may fluctuate and result in economic gains and/or losses.
Yes, clients receive dividends on the Stock ETFs and bond coupons on the Govt Bond ETFs they have invested in through AutoWealth. Dividends/bond coupons will automatically be reinvested.
Yes, dividends and bond coupons will be subject to a 30% U.S. federal withholding tax in line with tax regulations of the U.S. Internal Revenue Service. Nevertheless, ETFs listed in the U.S. are still preferred over ETFs listed in other countries like the U.K. after taking into consideration factors including liquidity, bid-ask spread, expense ratio, ETF fund size amongst other factors.
AutoWealth works with our partnering custodian to seek partial reimbursement of the withholding taxes from the U.S. Internal Revenue Service, where applicable.
AutoWealth’s investment portfolios are intended to generate market returns over the medium to long-term and are not suitable for short-term speculation. Generally, AutoWealth advise clients to take a long investment horizon as far as is practical. Our investment strategy is designed to ride out an entire market cycle including any market downturn or recession.
Unlike some mutual funds (unit trusts) or hedge funds, AutoWealth has no lock-in period for investments. Clients are free to withdraw their investment funds or close the investment account anytime with no penalty cost.
Yes, clients may request a review or change in portfolio mix through the AutoWealth platform.
Significant market movements may cause portfolio assets to deviate from their original intended allocation weightage. For example, the U.S.-China trade tensions in 1Q 2018 caused Emerging Market Stocks to decline materially and U.S. Government Bonds to rise materially causing an underweight in Emerging Market Stocks and an overweight in U.S. Government Bonds.
AutoWealth rebalances clients’ investment portfolios timely to realign the allocation weightage of portfolio assets for robust risk management and to maintain a consistent risk profile for all our clients.
Our portfolio rebalancing is supported by well-established research, including those documented in “Pioneering Portfolio Management [David F. Swensen, CIO of Yale Endowment Fund]”. The research concluded that threshold-based rebalancing statistically generates extra investment returns by exploiting excessive price volatility.
Apart from U.S. citizens and residents, we accept all other foreign clients regardless whether they are residing in Singapore or overseas.
Yes, you will be glad to know that we have clients who work for financial institutions that prescribes strict compliance pre-clearance processes or guidelines governing personal investments.
AutoWealth can provide you with a Compliance Certification letter, which is addressed to your financial institution's compliance department. The letter will certify that AutoWealth takes a market-returns approach, your investment portfolio is constructed and administered on your behalf in accordance with our market-returns approach, and that AutoWealth does not accept orders to trade in specific securities on your instruction.
AutoWealth charges a very competitive Advisory Fee of 0.50% per annum on the assets under advice and Platform Fee of US$18 per annum.
As an illustration, a typical client who invests S$10,000 pays about S$6.20/month in total fees and charges. In this example, AutoWealth’s fees and charges on a monthly basis is lower than a MacDonald’s Big Mac meal, although financial planning is far more important (no offence Macs, we still love you).
In contrast, mutual funds (unit trusts) typically charge about 2% in aggregate for sales charge, annual management fees, custody fees and other hidden fees and AutoWealth’s fees and charges are as low as 1/4 of these mutual funds (unit trusts).
No, the Platform Fee of US$18 per annum is a flat fee regardless of the investment amount.
No, transaction and custody fees will be absorbed by AutoWealth.
Therefore, AutoWealth clients enjoy lower transaction and custody costs vis-à-vis DIY investors.
AutoWealth Advisory Fees and Portfolio Fees are pro-rated and debited from clients’ investment accounts at the end of every calendar quarter. No action is required from clients.
When withdrawing in USD, AutoWealth does not impose additional fees.
However, as the beneficiary, you will receive your payment minus any applicable fees imposed by the correspondent (intermediary) bank and/or the receiving bank. As these fees may differ from bank to bank, please contact your bank representative directly for more details.
This does not apply to withdrawals in SGD.
Clients can start investing through AutoWealth to achieve their financial goals with as little as S$3,000. Investors can now look forward to better investment performance, lower costs and a hassle-free experience.
Clients may deposit funds into the investment accounts through:
from a bank account opened in the client’s name.
In line with anti-money laundering laws and regulations, AutoWealth and our partnering MAS-licensed custodian do not accept third-party funding and will return funds received from any third-party accounts to the sender.
Through the AutoWealth Platform, clients may deposit or withdraw funds in the following currencies:
Clients may contact firstname.lastname@example.org if they wish to deposit or withdraw funds in the following currencies:
Clients who commit to a Regular Investment Plan would be able to Time-Diversify (i.e. Dollar Cost Average) their investments.
Clients can set a recurring monthly or quarterly funds transfer to the investment account via online banking services provided by their respective banks. The recommended date of transfer is the 1st or 12th of each month. Once the funds are received and booked, AutoWealth will invest the investment funds on the next available market day, or as soon as is practical.
Clients may refer to the following step-by-step instructions to set recurring monthly or quarterly funds transfer:
Yes, clients may login to the AutoWealth Platform anytime to submit the withdrawal request.
AutoWealth will facilitate the withdrawal of your portfolio cash balance and/or liquidation of your portfolio assets, in full or in part, whichever applicable, in the same available market day or as soon as practical for any withdrawal request made through the Platform on or before 5pm SIN/HK time. Barring any delay in the bank clearing process, due to public holidays or otherwise, you can expect the funds to be credited in your designated bank account in one week’s time. Please note full closure of the investment account may take up to two weeks.
There are no penalties for withdrawal of investment funds or full closure of the investment account.
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