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Whether we are a working young adult, a corporate professional, a stay-at-home parent or a semi-retired retiree, having a source of passive income can be a great financial enabler.
Unlike having a side hustle, passive income is an income stream that doesn’t require active effort and management beyond the initial execution and implementation; it is not a second job. Instead, investing is one of the best ways to accumulate a source of passive income.
This is where StashAway Income Portfolio comes in. StashAway Income Portfolio focuses on the income aspect of investing and is specifically designed for Singaporean investors to build a passive income stream with a projected income of 3.75% p.a.
StashAway Income Portfolio Is Designed For Singaporean Investors Looking For Income
Unlike growth-focused investing where you often need to divest your investments in order to realise the gains, income investing generates you an income on a regular basis, typically through regular dividend payouts. StashAway Income Portfolio is an investment portfolio that pays out the dividends based on the distribution of its underlying exchange-traded funds (ETFs). This is projected to be a total payout of 3.75% a year.
The Income Portfolio also has a projected net return of 4.4% p.a. if you do not withdraw the payouts/ dividends and reinvest them back into the portfolio. These projections are based on the medium-term and on prevailing economic conditions.
StashAway Income Portfolio Is Diversified And Singapore-Focused
StashAway Income Portfolio is specifically targeted at Singaporean investors with its Singapore asset focus. The Income Portfolio comprises six SGX-listed ETFs that represent a mix of SGD-denominated government bonds, agency bonds, investment-grade corporate bonds, real estate investment trusts, and dividend-focused equities. These ETFs cover:
- Straits Times Index,
- SG Government Bond,
- SGD Investment Grade Corp Bond,
- Asia ex-Japan REIT, and
- Asia High Yield Corporate Bonds
This use of ETFs allows for diversification across the various income-generation instruments such as Real Estate Investment Trusts (REITs), bonds or dividend stocks.
StashAway Income Portfolio Earns Income Under Various Market Conditions
StashAway Income Portfolio is able to generate income through various market conditions not just because of the diversification of the underlying ETFs and product instruments, but also because of their robust rebalancing and re-optimisation strategies.
The Income Portfolio rebalances and re-optimises the underlying asset allocation using their in-house trading system to account for changing economic conditions. This is based on StashAway’s Economic Regime-Based Asset Allocation (ERAA) framework which takes into account market volatility and changing economic conditions.
This allows StashAway to maintain a StashAway Risk Index of 12% for the Income Portfolio, which means that there is a low chance of 1% of losing more than 12% of your capital.
StashAway Income Portfolio Does All These While Maintaining Low Fees
For an experienced investor familiar with Real Estate Investment Trusts (REITs), bonds or dividend stocks, creating your own individual income portfolio is possible. The underlying ETFs are available to retail investors. However, what StashAway offers is their robust rebalancing and re-optimisation strategies, on top of low fees.
For an ordinary investor, replicating the same rebalancing and re-optimisation strategies would incur a lot of transaction fees and this will have to be repeated for the multiple ETF counters to ensure proper asset allocation. This is on top of the hours put in to determine the ideal allocation, which is not ideal if our intention is to earn passive income from our investments.
StashAway does this automatically without the need for client intervention and does it for zero fees. Instead, they charge a tiered annual management fee, ranging from 0.2% to 0.8% depending on the assets under management.
Invest With StashAway Income Portfolio
If earning passive income from your investment is important to you, you might want to look at StashAway Income Portfolio. For DollarsAndSense readers, StashAway is giving 50% off in management fees for 6 months, for up to $50,000 in portfolio value.