2nd September 2022 - 3 min read
Digital wealth platform StashAway has partnered with global asset manager BlackRock to roll out a new offering in the form of a General Investing portfolio. Specifically, the asset allocation of the new portfolio will be guided by the insights and analytics from BlackRock, while StashAway manages the trade execution, deposits, withdrawals, rebalancing, and customer support.
According to StashAway, this General Investing portfolio is its most diversified portfolio yet, with 15 to 25 underlying funds. There are four different equity-bond ratios that you can choose from when setting up your portfolio, depending on your risk appetite:
All of the above portfolios have been around for some time; the 20-8-, 60-40, and 80-20 portfolios were first launched in 2015 and have since delivered 6.9%, 10.1%, and 12.2% annualised returns, respectively. Meanwhile, the 100-0 portfolio was introduced in October 2016, delivering 11.1% annualised returns since its inception.
As is the case with all of StashAway’s investment portfolios, there is no minimum balance or monthly requirements to invest in the new portfolio, and no lock-in period either. In terms of fees, management fees will range between 0.2% to 0.8% annually, with an average expense ratio of 0.2% p.a..
Following this latest development, StashAway investors will now have two General Investing portfolios to choose from: powered either by BlackRock, or by StashAway. This is on top of other investment options, such as Responsible Investing, Thematic Investing, Flexible Portfolio, and Goal-Based Investing.
StashAway explained that the key difference between the two General Investing portfolios lies in their objectives. The General Investing portfolio that is powered by StashAway (which relies on its investment framework, ERAA) seeks to minimise overexposure to risk when seeking returns. This means it may “deviate at times from the way markets are behaving in order to keep risk constant.”
Meanwhile, the General Investing portfolio powered by BlackRock prioritises broader exposure to the market. It generally follows the ups and downs of the markets to tap into opportunities that are available, with more re-optimisations in the process as compared to the General Investing portfolio powered by StashAway.
Here’s a comprehensive summary by StashAway to help you better grasp the differences behind both General Investing portfolios:
|General Investing (powered by BlackRock)||General Investing (powered by StashAway)|
|Investment strategy distinction||Provides the broadest market exposure while optimising for long-term returns||Keeps risk constant while optimising for long-term returns|
|What you can expect||Expect long-term outperformance, and ups and downs that follow the markets||Expect long-term outperformance, and occasional deviation from how the markets are doing in order to keep your risk level constant|
|Number of ETFs in a portfolio||15 – 25||7 – 13|
|Frequency of re-optimisation||Routine updates to the portfolio, approximately 4 – 6 times a year||Portfolio asset allocation changes are driven by economic regime changes, historically about once a year|
|Portfolio selection||Select your portfolio based on your preferred stock-bond ratio||Select your portfolio based on the potential drawdown|
Ultimately, StashAway emphasised that regardless of which portfolio you choose, they are all designed to outperform their benchmark in the long term. As such, investors are encouraged to invest regularly by dollar-cost averaging to benefit from either portfolios.
To celebrate the launch of the new portfolio, StashAway is currently running a promo where all new deposits into General Investing (powered by BlackRock) will be managed for free until 31 July 2023.
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