MONEYOWL is launching its digital investment service for the CPF, with the rollout of adviser retrocession-free share classes of 2 funds.
MoneyOwl, a robo advisory platform complemented by human advisers, is only the second robo firm to participate in the CPF Investment Scheme, after Endowus.
MoneyOwl has partnered two fund management firms - Lion Global Investors (LGI) and UOB Asset Management (UOBAM) - to offer adviser retrocession-free share classes for 2 funds.
The funds are the Lion Global Infinity Global Stock Index Fund share class C, a unit trust that feeds into a passive Vanguard fund tracking the MSCI World Index; and the United SGD Fund share class D, a short duration global bond fund. The funds' total expense ratios are 0.42 and 0.38 per cent, respectively.
Retrocessions, also known as trail fees, are the portion of funds' annual management fees paid out to distributors. The trail fee can exceed 50 per cent of the annual management fee.
To date, robo platform Endowus has pushed hard to raise awareness of lower-cost unit trusts and the dilution impact of high costs on returns. The funds available on Endowus are retrocession-free share classes. If the share class is not available, the trail fee is rebated to investors.
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MoneyOwl said the retrocession-free share class simplifies the experience for CPF investors by eliminating the wait for fee rebates and the need to reconcile the fund's investment outcome with rebates received. The share classes also "hard wire" the benefit of being retrocession-free without being dependent on an adviser's business structure.
The LionGlobal Infinity Global Stock Index Fund's share class C is already available on several platforms, while the United SGD Fund share class D is available only for MoneyOwl clients until the end of 2022.
Chuin Ting Weber, MoneyOwl chief executive and chief investment officer, said: "(The funds are) a significant step in lowering structural costs and providing simple and fit-for-purpose CPF investment solutions, to enable better investment outcomes for Singaporeans."
The firm will waive the advisory fee as an introductory offer for the new products for the rest of 2022.
There are a number of criteria for funds to be on MoneyOwl's platform, including costs, consistency of fund performance and the overall quality of the fund manager. "As an adviser and not just a platform, we do not seek to multiply investment funds in terms of variety. Rather, we see it as our duty to simplify and rigorously curate the most fit-for-purpose solutions for the different financial goals of ordinary Singaporeans."
Gerard Lee, LGI chief executive, said: "At Lion Global, we are constantly striving to live purpose beyond profit. One of the ways is structuring low-cost funds; and we are delighted to have found a like-minded partner in MoneyOwl. Together, we aim to unclutter the many layers of fees that stand in the way of better returns for investors."
Thio Boon Kiat, UOBAM group chief executive, said MoneyOwl's digital CPF investment service is in line with the firm's vision to democratise investing for people through cost-effective and easy-to-access solutions. "We are excited that (investors) can now access our low-cost flagship bond fund, which has enjoyed stable performance consistently for more than two decades, through this new service."
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