Syfe’s Smart Baskets allow investors to diversify their portfolio in just one order with a curated collection of stocks and ETFs, pre-built by wealth professionals.
If you haven’t heard of smart baskets before, here are the key things you need to know:
Smart Baskets visualised
Use optional filters to find a Smart Basket that suits your needs, scroll through our diverse list of 14 Smart Baskets, and deep dive into each basket to learn more about its past returns, composition, and dividend yield.
Let’s take a closer look at what choosing a Smart Basket involves.
Choosing a Smart Basket
With Syfe, whether you simply choose from our full list of Smart Baskets or use our optional filters – for most investors it’s vital they consider the following: time, risk, and preference.
1. Time
What’s your time horizon? This refers to how long you’re willing to stay invested in an asset before selling. When selecting a Smart Basket to invest in, you can use our optional filters to choose between a short term time horizon like 1 year up to a long term time horizon like 10 years.
As a general rule, if you were saving up for an engagement ring, for example – chances are your investing time horizon would be shorter and your willingness to take on elevated risk will be lower.
Investing for retirement, by comparison, is a completely different ballgame. With a longer time frame investors can generally afford to take on more risk and / or prioritise growth investments over income investments.
While higher risk assets like stocks can be volatile in the short term, over the long term they have historically performed strongly, making them ideal for an investor with a long term goal, like retirement.
In this case, Syfe’s US High Growth and AU High Growth Smart Baskets – which both have the objective of maximising risk-adjusted returns and capital appreciation (but are focused on different geographies) – might be worth investigating further.
2. Risk
What’s your risk tolerance? This refers to how much risk or volatility you’re willing to accept as an investor. With Syfe Smart Baskets you can select between low, moderate, and high risk.
Risk tolerance and time horizon go hand in hand. The longer your investment time horizon, the more risk you are generally able to take on when making an investment.
Here’s what we mean by that.
Financial markets – especially stock markets – can be incredibly volatile in the short term. In 2022 the S&P 500 – arguably the world’s most important and popular index – fell a staggering 18.01%.
For those with short term goals, these kinds of wild swings in value can be particularly disastrous. If you’re saving for an engagement ring, but your savings get slashed by 18%, your partner likely doesn’t care why or how the S&P 500 has crashed!
In this case, investors might be interested in investing in lower risk assets. When it comes to Smart Basket investing, the AU Conservative Growth or the US Conservative Growth Smart Baskets which target – you guessed it – conservative growth and income generation, might be worth exploring.
On the other hand, for those who are willing to take on higher levels of risk and stay invested for a longer period of time, higher risk assets like stocks have long proven an attractive option.
Case in point: over the last 10 years the S&P 500 index has annualised returns of 10.12% to 29 March 2023. And yes, that includes the 18% drawdown we mentioned above.
3. Growth & Income
Which type of investments do you prefer? When it comes to Smart Baskets, you can select between growth – which refers to investments that are expected to rise in value over time, or dividends – which refers to investments that provide investors with a consistent stream of income.
As we said at the start, your investment preference will be tied to your investment goals. Generally speaking, growth investing is more suitable for people with longer time horizons and higher risk tolerances, and income investing is better suited for people with shorter time horizons and lower risk profiles.
What’s next?
After playing around with those optional filters in the Syfe app, you’ll be shown a number of Smart Basket investments – that match the filter criteria selected.
The options displayed could range from Smart Baskets made up of high growth and riskier assets to more stable income-focused investments – spanning both US and Australian markets.
If you don’t see a Smart Basket that fits with your investing style or goals you can always play around with the optional filters until you find an investment you like.
To start investing in Smart Baskets and more
Download the Syfe app now and create an account to start building a portfolio of our wealth-backed, pre-built Smart Baskets. Or click here to learn more about Syfe Smart Baskets.
Plus, when you invest with Syfe you can also invest in 12,000+ ASX & US shares and ETFs directly – meaning you can build an all-weather, diversified portfolio. Start investing now.
Smart Baskets are pre-packaged orders formulated according to investment attributes of the underlying securities/ETFs (such as geographic and industry exposure, historical dividend yield, and historical capital appreciation), and do not take into account your personal circumstances, risk appetite, and goals. The information provided does not suggest or imply and should not be construed as any guarantee of future performance, or as investment advice or strategy. Each Smart Order comprises several separate orders for ease of execution only, and should not be construed in any manner as a managed discretionary account or a managed investment scheme. Investing involves risk, including the risk of losing your invested amount. Any information that may be in this communication is general in nature only and is current at the time of writing. Syfe does not make recommendations of any kind or provide personal advice that take into account your objectives, financial situations or needs. You should therefore consider the appropriateness of the information in light of your own objectives, financial situation or needs before acting on such information, and/or speak to your financial or tax adviser for personal advice. Past performance figures are based on information provided by third parties and may not be accurate. Any references to past performance and future indications are not, and should not be taken as, a reliable indicator of future results. Syfe does not intend for any statement made here to relate to the acquisition or disposal of any shares in the companies or other financial products named here. Syfe makes no representation and assumes no liability as to the accuracy or completeness of the content of this communication.
