Tan Kin Lian's Blog: Buy unit trusts with Fundsupermart

Monday, May 05, 2008

Buy unit trusts with Fundsupermart

Fundsupermart charges 1.75% for the upfront fee to invest in the unit trusts in a RSP (i.e. regular savings plan). This is a low fee, as it is less than 3% that is being charged by most other unit trusts and investment-linked funds. 100% of the monthly savings is invested, compared to low "allocation rates" that take away more than 18 months of savings by an ILP policy.

I spoke to the Fundsupermart personnel who told me the following:
> I can invest cash or CPF savings
> The payments are done automatically, after the authorisation has been signed
> There are no additional charges

This sounds like a good way to make long term investment. I will arrange for all members of my family to visit the Fundsupermart office to sign the forms to open the accounts, bank authorisation, etc. They can have $x of monthly investment deducted from my bank account.

They can learn how to manage their accounts through the internet. By educating them, they will be able to manage the investments in unit trusts on their own in the future.

The next step is to decide on how to choose the unit trusts. I shall be looking at the following:
> well diversified
> invested mostly in blue chips
> low expense ratio (less than 1.3% p.a.)

If you have any tips, please send to kinlian@gmail.com. This will save me from making detailed research.

I believe that DollarDex and POEMS may have similarly attractive offers. If they send some details to me, I shall post them in this website.

6 comments:

Anonymous said...: Mr Tan,

The turnover rate for the unit trust is also an important consideration. Do not choose those with high turnover. Research has shown that low turnover rates will result in better performance in the long-run; May 05, 2008 3:34 PM
Anonymous said...: My IFA recommended this to me.

http://www.ifastnetwork.com/ifast/home/costSaving.tpl; May 05, 2008 8:31 PM
Anonymous said...: Hi Anonymous 8:31pm,

What your IFA has recommended you is the same platform that Fundsupermart is using, the iFAST platform.

If you purchase unit trusts through your IFA, you have to incur an annual wrap fee of 1% p.a. This is on top of the annual fund mgt fees.

It is better to invest on your own rather through your IFA. In the long-term, all these costs will eat up the returns.; May 06, 2008 12:21 AM
Anonymous said...: There is an iPhone / iPod touch application that helps you monitor your Fundsupermart investments. It’s called Fund Watch and it’s available at the app store or the URL above.; September 30, 2008 1:16 AM
Anonymous said...: Fundsupermart has just introduced a platform fee of 0.125% per quarter of your holdings.; April 01, 2010 11:06 AM
Anonymous said...: Exactly. In one stroke, Fundsupermart just painted themself out of the Singapore online unit trust distributor market.

If I continue with stay with Fundsupermart, I have to start paying $2000 of annual account fees for what was previously $0 annual account fee. Only a FOOL will stay in Fundsupermart.; April 02, 2010 4:06 AM