Too busy to invest? Here’s how you can invest safely for the long term even when you don’t have time.
Long term investment holds a number of benefits over investing over a shorter term. For one thing, an investment held over a longer term allows you to benefit from compounding, when you reinvest your dividends back into your investment.
You also have the benefit of focusing on the long term growth of your investments. Instead of getting affected by minute changes in the market on a day-to-day basis, your investment can ride out the peaks and troughs over the longer time period, reducing the volatility of your investment. Renowned investor Warren Buffett is known to hold his investments for decades at a time, and some of his investments have paid off handsomely.
Making fewer transactions also reduces the fees and cost of your investment, which can take a toll on your investment returns if you are not mindful of them.
Investing takes time, but there can be an easier solution
Now you know the benefits of long term investing, but what if you cannot afford the time to choose the right investment instruments for yourself? DBS now offers digiPortfolio, an investment portfolio for time strapped persons like yourself.
In a nutshell, digiPortfolio is a marriage of human expertise and robo-technology. It provides you with the benefit of staying invested for a long period of time without having to constantly keep an eye on the market, providing you with an easy way to diversify your investment regionally or globally, and supplement your other investments with help from investment experts.
Here’s what you need to know about it.
What is digiPortfolio?
digiPortfolio is a ready-made investment portfolio comprising a combination of fixed income exchange traded funds (ETFs) and equity ETFs.
The portfolios are created with the expertise of DBS’ investment portfolio managers, who handpick the most suitable exchange traded funds to form the portfolio, and continue to monitor the market on the investors’ behalf. They are also tasked with aligning the portfolios to the views of the DBS Chief Investment Office for optimal asset allocation and portfolio resilience, and rebalancing the portfolio when necessary.
Beyond tapping on human expertise, digiPortfolio also makes use of technology to automate processes including backtesting, rebalancing and monitoring, making the entire process more efficient and transparent.
Two unique portfolios for your unique needs
digiPortfolio offers two different types of portfolios: the Asia Portfolio and the Global Portfolio. Here are some of their key differences.
The Asia portfolio focuses on SGX-listed ETFs and is good for investors who believe in the growth of Singapore and the region. It is also suitable for investors who may have limited investment experience as no pre-qualification is needed to start investing.
On the other hand, the Global portfolio invests in UK-listed ETFs and is good for investors who want to broaden their investments globally. However, investors have to first pass the Customer Account Review (CAR) before they can start investing.
What are the fees involved?
Investors using the digiPortfolio are only required to pay a management fee of 0.75% per annum. These fees are debited annually or at the point of portfolio closure. There are no other sales charges, platform fees or switching fees payable.
In fact, for maximum flexibility and peace of mind, you are even allowed to withdraw your investment at any time, without incurring a penalty. However, you should be aware that it will take several days to complete the closing of your positions, and if your closing position is lower than your opening position, you will incur a loss.
The minimum investment for the Asia portfolio is $1000, while the minimum investment for the Global portfolio is US$1000.
Partial top ups are also available, with no minimum or maximum limits. However withdrawals are currently unavailable, so if you would like to reduce your investment, you would have to close the portfolio.
3 steps to get started with digiPortfolio
How can you get started with the digiPortfolio?
If you are an existing DBS account holder, you can apply for it by logging into digiBank online, and locating digiPortfolio in the Invest tab.
To apply, follow these 3 steps.
- Select the portfolio type
- Indicate your preferred risk level, funding account, funding currency and amount.
- Confirm your details
As digiPortfolios can be purchased in both SGD and USD, the transaction will only be completed using funds from an individual Multi-Currency Account (MCA). eMulti-Currency Autosave (eMCA), eMulti-Currency Autosave Plus (EMCA+), Multi-Currency Autosave Plus and Multiplier accounts can all be used to fund your investment in digiPortfolio.
What’s more, if you apply for a Multi-Currency Account for the sole purpose of funding your digiPortfolio, all fall-below fees will be waived for your account. Learn how to apply for a Multi-Currency Account here.
Once you are invested in your choice of digiPortfolio, you will be able to see the details of all the underlying ETFs of your portfolio in the Portfolio Details page of digiBank online. You can also view the updated details on your portfolio transactions, holdings and performance on-demand from digiBank online.