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Endowus launches Cash Smart Ultra with highest cash management yield in Singapore

Apr 2021
  • Newly launched Cash Smart Ultra achieves industry-leading projected yield of up to 2.0% by efficiently optimising portfolios, leveraging access to best-in-class products and fund managers, and minimising costs
  • Endowus Cash Smart, a range of cash management products aiming to outperform popular savings and deposit products, has been steadily taking market share from traditional banking products
  • Existing Core and Enhanced portfolios have been successfully beating bank deposit rates while maintaining low levels of risk, especially important in the current low interest rate environment
  • Endowus takes a similar approach to general investing, having developed a full range of offerings to raise the bar for retail investing in Asia as the first and only digital advisor for CPF, SRS and Cash investing.

Endowus moves to provide investors a higher-yielding cash management option in today’s historic low-interest rate environment with the launch of Cash Smart Ultra, the third solution in its Cash Smart suite—presenting investors with an opportunity to achieve maximum returns on their cash holdings.

Endowus’ Cash Smart Ultra will target a 1.8~2.0% yield, the highest in the market among cash management portfolios provided by digital platforms. And this at the lowest achievable fees in the market, featuring the same 0% sales charges and 100% trailer fee rebates that Endowus continues to deliver for all of its investment solutions. Cash Smart is an entirely flexible cash solution unlike traditional fixed deposits, allowing clients to withdraw their cash anytime—while offering attractive yields, especially important in the current environment. 

Cash Smart Ultra achieves these results by dynamically targeting the highest risk-adjusted return from a combination of best-in-class short-duration fixed income and money market funds from the leading money managers that Endowus proudly partners with, such as PIMCO, Lion Global Investors, Fullerton Fund Management, and Nikko Asset Management. The covariance of the underlying funds are optimised to minimise risk and volatility in portfolios aimed at managing investors’ short-term cash and liquidity needs. 

A necessary solution for the changing times

Interest rates collapsed globally in March 2020 and have continued to fall in subsequent months. As it stands, SIBOR, government bills, savings accounts, Singapore Savings Bonds, and bank fixed deposits are all below 1%—severely limiting investors’ opportunities for adequate yields on their cash.

Further, bank fixed deposits and insurance-backed products present additional liquidity risk for investors: your money must be locked up for the entire period, and any interest gained will be lost if funds are withdrawn early. Some other products tout a bigger number but only for the first few thousand dollars. Endowus takes care of all your cash and liquidity management needs, customised to your specific risk tolerance and time horizon, to suit your individual goals.

Source: Endowus Research, MAS, DBS

Over the past year cash management accounts have become increasingly popular and more widely available, with Endowus’ Cash Smart suite leading the way with the highest projected rate. With this third instalment—Cash Smart Ultra—you have an even greater choice when managing different buckets of your cash. 

Building on the platform of a high-performing Cash Smart suite 

Since its launch in June 2020, the Endowus Cash Smart suite—Cash Smart Core and Cash Smart Enhanced—have delivered higher returns than originally projected, handily outpacing major deposit rates in Singapore. And it is on the back of this outperformance and growing demand that Cash Smart Ultra was developed. 

Since inception, Cash Smart Core has performed on the higher end of its projected yield with an annualised return of 1.25%, while Cash Smart Enhanced generated an annualised return of 2.57%, significantly higher than the 1.9-2.2% targeted at launch. 

The Cash Smart difference

“We are humbled by the reception that our Cash Smart portfolios have received and the tremendous growth it has seen. We are excited to launch a third new solution to provide our clients with an additional option as we constantly look for ways to add value to our clients and provide best-in-class solutions for individual and retail investors, who lack choice.” said Samuel Rhee, Chief Investment Officer, Endowus. 

“We cannot make a prediction on the future direction of interest rates. However, our Cash Smart clients can rest assured that we will continuously improve these cash management  solutions by managing risk and optimising the portfolio to achieve the highest yield possible, utilising the full breadth of money managers and underlying products available to us. We will continue to focus on our fiduciary duty to always do what is in the best interest of our clients, through robust advice with the highest degree of integrity and transparency.“

While Cash Smart Core is the safest option for the short-term cash that investors will need to access within ~30 days or beyond with virtually no risk of loss, Cash Smart Enhanced provides a higher yield by accepting slightly higher volatility—ideal for cash that investors will need to access after 1~2 months and beyond. And at the top tier, the newly launched Cash Smart Ultra achieves the highest possible yield by taking on measured risk for cash that investors will need to access after 3 months or beyond to be safe. Notably, Endowus Cash Smart addresses this wide range of cash management needs without requiring any lock-ups, while providing daily accrual of returns. 

While having the option of Core, Enhanced, or Ultra ensures that investors are always fully compensated with higher returns for additional risk taken, the Cash Smart portfolios all remain defensive even as rates rise or during uncertain environments. This is due to the allocation to select money market instruments, on the short end of the yield curve, with very low duration exposure. The Cash Smart portfolios’ underlying funds are prudently managed to suit short term liquidity needs by continuously managing this duration exposure. 

For more information on Cash Smart Ultra and other Endowus investment solutions, visit Endowus.com/cash-smart.

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