StashAway Simple & Endowus Cash Smart reduce projected yields

Both StashAway Simple and Endowus Cash Smart have reduced their yields on their cash management products.

StashAway previously offered 1.9% projected annual returns for its Simple portfolio, but in an email to clients today, they announced that they will be reducing this yield to 1.4% starting 1 September 2020.

BeforeAfter (1 September 2020)
StashAway Simple1.9%1.4%
StashAway Simple yield changes

While the underlying funds have not been performing as well, StashAway had provided rebates to maintain the projected yields of 1.9% – however, it has now deemed the rebate unsustainable.

On a related note, Endowus has also recently lowered its projected yields on its Cash Smart cash management product – and across the board, we should see yields dropping by 20 basis points.

BeforeAfter (21 August 2020)
Endowus Cash Smart Core1.1% to 1.3%0.9% to 1.1%
Endowus Cash Smart Enhanced1.9% to 2.2%1.7% to 2.0%
Endowus Cash Smart yield changes
New projected yields, visualised, versus bank deposits

When we look at projected yields, which are rather dynamic in nature, we must be aware that they can change according to market conditions.

With the interest rate environment staying low for the forseeable future, driven by the US Federal Reserve’s commitment to stabilize the economy through unprecented fiscal and monetary stimulus, investors looking for higher yields need to take on additional risk.

If you have less than $10K, then Singlife’s 2.5% is the most attractive option to park your money now – although it is certain to see its rates revise soon.

If you don’t need the cash for several years, then consider moving your funds to a low-risk investment portfolio (e.g. 40/60) or dollar cost average into the markets to take advantage of low rates driving higher asset prices.

See also: Where should I park my cash?

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    1. I believe both are net yields. I quote – StashAway Simple returns are the sum of the amortised yield of the two underlying funds, less fees that the underlying fund manager charges, plus rebates.

      1. Point noted, thanks! The interesting thing is Endowus has a chart stating the gross and net yields of their competitors and the MMFs itself. I saw it in their webinar, but cannot find it on their website.

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