Singapore real estate investment trusts, or S-REITs for short, is a valuable component of many income investors’ portfolios, namely for its stable dividend income. Syfe launched the first S-REIT focused portfolio in late January and it has been gaining popularity since.
Who is Syfe?
Syfe is a digital wealth manager (robo-advisor) launched in Singapore after raising $5.2 million in seed funding, led by UK-based venture capital fund Unbound. They are also Licensed by the Monetary Authority of Singapore (MAS) under a Capital Markets Services License.
Read more: Our review page of Syfe.
Syfe has launched multiple robo-investment portfolios that give investors the option to choose the markets or sectors that they prefer to invest in.
REIT+ is one of the portfolios that you can select when investing with Syfe, and it is an easy way to invest.
Syfe REIT+ is a portfolio of the 20 largest REITs in Singapore. It tracks the iEdge S-REIT Leaders Index and includes well-known REITs such as Ascendas REIT, CapitaLand Integrated Commercial Trust, Mapletree Commercial Trust and more. Even if you’re not familiar with these REITs, you probably know the properties they manage, from Vivocity to Bugis Junction to Changi Business Park.
Deep diving into REIT+, the portfolio consists of two asset classes; Equity and fixed income. You have the option to invest 100% in equity or a blend of both.
The equity component of the portfolio consists of REITs. But rather than to invest in all the REITs listed on SGX, Syfe REIT+ chooses 15 high-quality REITs to invest in for the portfolio. The portfolio has exposure across various sectors such as industrial, retail, office, residential and others.
For the fixed income portion, Syfe uses the ABF Singapore Bond Index Fund. This allows it to shield your portfolio against volatility by managing your risk with Syfe’s ARI methodology and gain diversification into an ETF, which invests in high-quality Singapore government bonds.
You can also choose to have dividends paid out quarterly to your bank account or have them reinvested automatically, at no additional cost.
Who should get it
We recommend this for people looking to generate a stream of passive income through dividends. Budding investors looking to start investing in REITs can also see the diversified REIT+ portfolio as a good starting point.
For seasoned investors that already have various other investments, the REIT+ could be a good supplement to your overall portfolio, especially if you are lacking in REITs exposure.
The outlook for REITs is also something to bear in mind on the back of COVID-19. Dividends could fall in the coming quarters due to reduced foot traffic in malls, a shift to working from home and the lack of tourists in Singapore.
What we like about the portfolio is the diversified exposure it provides. There’s no need to pick REITs or try to guess which REIT sector is going to perform well. You can stay invested in this asset class without the need to research and keep track of which REITs you should hold or sell periodically.
REIT+ holds REITs across the retail, office, industrial, data center, healthcare and hospitality sectors. So even if retail and office REITs hit a rough patch, you still have exposure to other sectors to cushion the blow.
The funds and the fees
One Syfe’s biggest advantage is that you don’t need a lot of money to start, which is great news for many beginner investors. Their most basic account tier has no minimum investment value, which means you can just jump in with a small sum.
You can fund your Syfe account in both Singapore Dollar (SGD) and U.S. Dollar (USD). You can also top up your Syfe account anytime and the funds will automatically be invested the next day. Funds in your Syfe account are held in a Trust Account in DBS Bank while your investments are held in a Custodian Account through Saxo Capital Markets.
Opening an account with Syfe is simple. You will first be tasked to complete your risk profile. Through this risk profiling, Syfe will also get a better understanding of your investment objective, financial situation, investment expertise, how much you need to achieve your goal and most importantly, your downside risk.
There is no minimum holding or lock in periods for investing with Syfe. This means that you can withdraw your funds at any time with no withdrawal fees charged.
While you cannot control your portfolio’s performance, you can control the fees you pay. No matter what type of investment you make, all investments come with some form of cost or fee, such as transaction costs, management fees and administrative charges. However, what’s important is to keep these costs low as they inevitably eat into your investment returns.
Syfe charges between 0.4% to 0.65% per year, depending on your invested amount across all portfolios. This all-inclusive management fee gives you unlimited, free withdrawals and unlimited rebalancing. It is calculated daily and billed at the end of each month. Should you withdraw your balance before the end of the month, you pay only for the days your money was managed by Syfe.
You can sign up for a Syfe account here. Use the promo code BEEWAIVER to get a management fee waiver for the first 6 months. Eligible for investment up to $30,000.