Following Syfe’s recent launch of thematic investing, StashAway has joined the foray with its own take of thematic investing.
It is launching with 3 thematic portfolios, namely technology enablers, the future of consumer tech, and healthcare innovation. Each of these thematic portfolios are designed to provide investment opportunities to sectors that have a high growth potential.
These new portfolios feature ETFs from global fund managers including ARK Invest, iShares, Global X, and VanEck
These portfolios are aimed to maximise exposure to promising long-term trends within your risk preference, which are customisable on the app, with the goal of outperforming in the long term broad indexes.
According to StashAway, it describes the various portfolios as follows:
Technology Enablers include technologies that are invisible. That is, consumers don’t see these technologies, but these technologies enable new ones to transform the world as we know it. Some of these new technologies include artificial intelligence, blockchain, and semiconductors.
The Future of Consumer Technology includes technologies that we, as everyday consumers, use. These technologies are changing the way we connect, move, and live; they range from social media platforms and e-commerce sites to Teslas and video games.
Healthcare Innovation consists of technologies that can not only improve but even change the way we stay healthy, get treatment, and recover. This portfolio gives investors exposure to pharmaceuticals, biotech, and innovative healthcare technologies, such as smart beds and software used for genome sequencing.
Risk focused with balancing assets
While returns may be high due to its highly risky nature, it comes with far greater volatility and drawdowns. To mitigate this and help investors stay the course, StashAway’s thematic portfolios also include non-theme assets, or balancing assets, to reduce drawdowns.
Fitting thematic portfolios into a holistic investment portfolio
Thematic portfolios may be best used as part of a core-satellite approach.
Once you’ve formed the core of your investment portfolio with core assets like a globally diversified index fund, you may look to branch out into satellite portfolios – smaller portfolios that complement an existing one – to improve the overall long-term returns or achieve other investment outcomes.
Personally, I’d recommend thematic investments like these offered by StashAway to be at most 5-10% of your equity portfolio, as they may offer more risk per level of return, and may not be suitable as a majority holding if you’re looking to build sustainable and long-term wealth.
Setting up a StashAway thematic portfolio
I’ve chosen to allocate $300 per month to these portfolios so that I’ve some content to write about, and also to see how each of these compare to each other.
To get started, simply download the app, click on New portfolio and follow the instructions on the app.
Note that StashAway thematic portfolios have slightly higher fees than its traditional portfolios and the average ETF expense ratio is roughly 0.52%.
StashAway is also offering a promotion when investing in these thematic portfolios, so if you’re already a customer, you can enter the following codes under More > Promotions > Enter Promotion Code on the mobile app.
- 1 month’s free investing on funds of up to $3,000 SGD: TP1MONTH
- 3 months’ free investing on funds of $3,000 SGD or more: TP3MONTHS
- 6 months’ free investing on funds of $10,000 SGD or more: TP6MONTHS
- 9 months’ free investing on funds of $25,000 SGD or more: TP9MONTHS
- 12 months’ free investing on funds of $50,000 SGD or more: TP12MONTHS
In a partnership with SingSaver, use this exclusive link to get up to $40,000 SGD for free for 6 months.