Grab AutoInvest, launched in September 2020, has brought an automatic investment platform for investing at the micro level.
As you can guess, you have to be a Grab user to use its services.
Let’s dive deeper into it to explore more about the platform.
What Is Grab AutoInvest?
Grab AutoInvest is a micro-investment platform aimed at bringing investing to a day-to-day level with every Grab transaction you make.
To simplify, each time you make a transaction using Grab, an additional amount of money of your choice is automatically invested.
From there, you’ve got to select an investment amount ranging from $1, $2, or $5, and according to your selection, the amount will be invested whenever you make an eligible transaction.
This may come from taking a Grab ride, ordering GrabFood, shopping with GrabMart, or paying in-store and online with your GrabPay Wallet or GrabPay Card.
And as they claim, your small investment will bring you an unguaranteed return of 1.18% per annum.
With this, you can earn enough money to spend with your GrabPay Wallet.
In short, with its automatic investment technology, Grab AutoInvest solves the problem of consistent investing and regular monitoring of your investment.
At the same time, they make you grow an investment habit, although on a small scale.
Grab AutoInvest Investment Methodology
The investment methodology of Grab AutoInvest focuses on providing stable returns with low risks.
Grab’s technology and 2 leading asset managers based in Singapore – Fullerton Fund Management and UOB Asset Management – work together to manage a professional and actively managed diversified portfolio of conservative funds.
Leveraging their smart algorithm, the portfolios are set up to keep them from tilting towards a particular asset.
However, you can start and stop investing any time according to your own convenience.
Investment Portfolios & the Respective Asset Classes
Now, what asset classes is your money invested in?
Well, your investment portfolio contains the following investment products as of now —
- Selected money markets
- Short-term fixed income mutual funds
Since Grab doesn’t have any exclusive partnerships with any particular asset management company, chances are that they select the investment funds with utmost care.
And these funds are managed by the 2 partners of Grab as mentioned above.
Despite the platform’s investment in the aforementioned asset classes now, it may not always do so.
Grab AutoInvest Fees, Charges, and Exchange Rates
Fees and Charges
Grab AutoInvest introduces a simplistic and transparent fee structure with a low, all-inclusive fee of 0.45% per annum.
That’s $0.45 per year for every $100 invested.
This all-inclusive fund fee or Total Expense Ratio includes the fund management fee and other operating costs associated with managing the fund including custodians, auditors, trustees, legal advisors, etc.
There are no additional and/or hidden fees on the part of Grab AutoInvest. The platform just charges a small cut (0.2%) from the fees charged by asset managers.
Here, you don’t need to pay any transaction charges or any subscription, redemption, custody, or account fees.
There’s no lock-in period for your funds.
Minimum deposits & withdrawals with Grab AutoInvest
Being a micro-investment platform, the minimum deposits and withdrawal requirements set by Grab AutoInvest are something that will relieve you.
Here, you can start with as low as $1. In fact, this amount works as both a minimum deposit and withdrawal amount on the platform.
As they state, this little investment will potentially earn you up to 1.18% annual returns.
However, note that you can’t invest more than $5 on Grab AutoInvest.
Funding & Withdrawal Methods at Grab AutoInvest
Grab AutoInvest supports the following transaction methods till now —
- GrabPay balance in your GrabPay Wallet
- GrabPay Card
- Credit or Debit Card
AutoInvest predominantly works through your GrabPay Wallet.
You can fund your AutoInvest account via automatic transfers, which are triggered automatically upon the successful completion of eligible transactions.
To fund your account for investment purposes, you need to select an amount from the 3 given options.
Your chosen amount will automatically be transferred to and then invested through your AutoInvest account.
On Grab AutoInvest, your withdrawals are also made through direct transfers to your GrabPay Wallet only.
Let’s look at specific critical points when wanting to withdraw your funds from Grab AutoInvest.
- Post transfer, your GrabPay Wallet balance cannot exceed S$5,000.
- The minimum withdrawal amount is S$1.
- If the withdrawal amount is equivalent to 90% or more of your portfolio, it will result in a full withdrawal of all the investments in your portfolio.
- Again, when less than S$1 remains in your AutoInvest account after deducting the partial withdrawal amount, it will result in a full withdrawal of all the investments in your portfolio.
*Note that not meeting one or more of these requirements will prevent you from withdrawing from your investments and transferring the proceeds to your GrabPay Wallet.
Also, mark that —
- The withdrawal process usually takes 2 to 4 business days as different funds have different withdrawal timings.
- Once all Asset Management Companies have successfully processed the withdrawal, GrabInvest will automatically transfer your withdrawal amount to your GrabPay Wallet.
Although withdrawals are only to your GrabPay account, we’ve found a workaround to withdraw this to your bank account.
All you have to do is initiate a withdrawal to your bank account from your GrabPay after you cash out on your investments.
Before investing with Grab AutoInvest, make sure that you go through these eligibility criteria:
- Grab AutoInvest is available only in Singapore; you must be a Singaporean, a Singaporean Permanent Resident (PR), or a Work Pass Holder to sign up with AutoInvest.
- You must be at least 18 years of age.
*Note that presently Grab AutoInvest is not available for US persons.
Is Grab AutoInvest Safe?
Grab AutoInvest has announced the first step of its safety plan, obtaining its Capital Market Services Licence from the Monetary Authority of Singapore (MAS) with licence number CMS100908.
Your investments are segregated from Grab’s funds and their underlying asset managers.
They are kept in separate custody accounts with licensed regional financial institutions.
With this, Grab Autoinvest seems pretty safe.
Who Is Grab AutoInvest Best for?
Grab AutoInvest is not recommended for people with moderate or large investment goals due to its limited features and restrictions.
In other words, it’s a platform for small investments that eventually will enable you to pick up an additional meal or two.
Thus, if you haven’t invested before, Grab AutoInvest might be for you to cultivate investing habits.
Frequent Grab users can also consider using Grab AutoInvest.
Overall, Grab AutoInvest has both positives and negatives.
Let’s start with the positives.
It’s truly a positive when an investment platform lets you get to start with as low as S$1.
Apart from that, AutoInvest’s fee structure is transparent and straightforward, with only one all-inclusive fee involved.
However, unfortunately, the negatives surpass the positives.
First off, let’s look at the investible limits.
While the minimum investment amount relieves beginner investors or investors with small amounts to invest, the upper limit can be a hindrance.
It’s impossible to plan anything significant, let alone something moderate, for only S$5.
Again, considering the investment amount, 0.45% in fees is relatively high.
You’ll find several robo advisors or other investment options on the market that will let you invest at a relatively lower fee while guaranteeing your return (which is also higher than the return promised by AutoInvest).
Here’s a list of alternatives you consider that offers low minimum investment amounts.
|Syfe Cash+||Since Grab AutoInvest is more like a cash management account instead of a robo advisor, Syfe Cash+ a similar product with lower fees (0%) and better returns (~1.9%).||Those looking for a similar product to Grab AutoInvest.|
|Syfe Wealth||Start investing from just S$1 into various portfolios based on your risk tolerance.||Those with small (and big) amounts to invest in the long-term.
Looking for better growth than 1.18% p.a.
Those with a higher risk appetite.
Those looking for someone to manage their investment.
|Webull Singapore||Start investing from as low as US$5 into fractional shares in the US markets.||Those with small (and big) amounts to invest in the long-term.
Looking for better growth than 1.18% p.a.
Those with a higher risk appetite.
Those looking to manage their own investments.
Finally, let’s conclude that these are our honest and unbiased opinions regarding Grab AutoInvest.
At the end of the day, the decision is yours. And your decision depends upon your investment goal and what stage you are in as an investor.