Digital wealth manager StashAway has introduced StashAway Simple Guaranteed, its third cash management portfolio after StashAway Simple and StashAway Simple Plus.

According to StashAway, the Simple Guaranteed portfolio is the first-of-its-kind in Singapore to provide guaranteed returns on any investment amount.

With no management fees from StashAway, Simple Guaranteed boasts a return rate of 3.4% p.a. as at April 24, over a lock-in period of six months. The rate of return for Simple Guaranteed will be reviewed daily and updated as needed, says StashAway, providing clients with the flexibility to choose when to lock in their rate.

StashAway says its Simple Guaranteed portfolio invests in fixed deposits from reputable banking providers regulated by the Monetary Authority Singapore (MAS). At launch, the funds will be placed in fixed deposits from Citibank N.A., Singapore Branch, says StashAway to The Edge Singapore.

Higher fees for Simple and Simple Plus

The launch comes a day after StashAway revised management fees for its two existing cash management portfolios, Simple and Simple Plus.

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From July 1, StashAway’s Simple and Simple Plus portfolios will bear a management fee of 0.15% p.a. and 0.2% p.a. respectively. The coming hike represents a 15 basis points (bps) increase for both portfolios.

In an email to users on April 23, StashAway says the fee hike will ensure the company can cover the cost of operations, and the advertised return rate of its portfolios will always be net of fees.

StashAway launched Simple Plus in July 2022 with a projected 2.7%–3.2% p.a. return, which was then nearly twice the projected rate of return of its inaugural portfolio, Simple.

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At the launch of Simple Plus, StashAway advertised a waiver of management fees until June 30 this year. StashAway said then that it would levy a 0.05% p.a. fee on Simple Plus accounts thereafter.

Meanwhile, Simple portfolios are currently not subject to management fees.

As of April 23, the projected rates for StashAway’s Simple Plus are between 4.6% and 5% p.a., while the Simple portfolio touts a projected rate of 3.4% p.a.

Stashaway Simple was launched in November 2019 with a projected rate of 1.4% p.a. This was later adjusted down to 1.2% p.a. on March 1, 2021; before slipping further to 1.0% p.a. on Dec 1, 2021.

In May 2022, StashAway and its peers began raising interest rates on their respective cash management portfolios, after the US Federal Reserve started raising rates in March 2022 to quell inflation.

Simple Plus’ underlying funds are: 20% in the LionGlobal SGD Enhanced Liquidity Fund, 35% in the Nikko AM Shenton Short Term Bond Fund and 45% in the LionGlobal Short Duration Bond Fund.

Stashaway Simple’s underlying funds are: 30% in the LionGlobal SGD Money Market Fund and 70% in the LionGlobal SGD Enhanced Liquidity Fund.

Traditionally, the easiest way to optimise returns on cash was to keep looking for the highest-yielding bank savings account and go through tedious conditions, says Stephanie Leung, chief investment officer at StashAway. “We now have a sophisticated suite of cash management solutions that caters to different customer needs and financial goals, empowering our clients to make the most out of their cash — no matter how unpredictable the market may be.”

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