If you are looking to diversify your portfolio, you probably would have come across IWDA and VTI. Boththese funds provide you exposure to some of the world’s largest and most widely held stocks while spreading your portfolio over several sectors.
With both ETFs being a decent choice to add to your portfolio, you may be wondering what are the key differences between these two indices, and which should you invest in?
If you have been looking for a broker to invest or trade with, you would probably have come across Saxo Market’s SaxoTraderGO and SaxoInvestor.
What are the key differences between these two platforms and which should you use to invest in?
Here’s what you need to know to help you decide:
The difference between SaxoTraderGO and SaxoInvestor
SaxoTraderGO is more geared towards actively trading on the market, while SaxoInvestor is more geared towards a buy and hold strategy.
SaxoTraderGO is an award-winning trading platform that has the interface and tools to ensure smooth and seamless trading.
On the other hand, SaxoInvestor is more tailored towards investors who are newer investors. SaxoInvestor offers a lower barrier to entry and a more simplified user interface if you’re just looking to dip your toes into investing.
The similarities between SaxoTraderGO and SaxoInvestor
SaxoTraderGO and SaxoInvestor both share the same account, hence you would not need to create 2 separate accounts if you wish to use both platforms.
Both of these platforms have demo accounts as well, these paper accounts allow you to try out both platforms using simulated money to get a feel of the platforms first.
Available financial products
SaxoTraderGO offers a wider range of financial products to use on the platform such as forex, CFDs and futures. Meanwhile, SaxoInvestor is more limited in its options, having only stocks, ETFs, mutual funds and bonds.
Here is the list of the available financial products on the two platforms.
Products found in both platforms
Over 19,000 stocks across 37 international exchanges
Over 5,000 government and corporate bonds
Over 3,000 exchange traded funds across over 30 exchanges
Over 500 mutual funds with global investors
Defensive to aggressive portfolios adjusted to your goals
Regular savings plan
Defensive to aggressive portfolios from S$100 contributions per month
And here is the list of financial products only available on SaxoTraderGO:
Products only found on SaxoTraderGO
182 major, minor, and exotic FX pairs
Over 9,000 on stocks, indices, forex, commodities, options, or bonds
Over 200 futures across 23 exchanges internationally
Trade spot metals, corn, and Brent Crude or WTI crude oil
44 Forex vanilla options across major pairs
Over 1,200 listed options across 23 global exchanges
SaxoTraderGO comes out on top over SaxoInvestor by having a lot more products available. However, SaxoInvestor being a more beginner friendly platform, does not list the more complicated financial products which you may not touch if you’re a new investor.
This helps to keep the platform and user interface cleaner and easier to navigate with less of an information overload on the screen.
Likewise, for each platform’s functions, SaxoTraderGO has a wider selection of functions for traders while SaxoInvestor has fewer functions to not overcomplicate its platform.
While both SaxoTraderGO and SaxoInvestor allow you to buy and sell stocks, you can place different types of orders on SaxoTraderGO, such as:
Buying on margin
Shorting on margin
On SaxoInvestor, you are limited to simply buying and selling your financial product with your funds during market hours.
On the other hand, on SaxoTraderGO, you are able to buy and sell during the premarket and postmarket as well. To add to this, you are also able to use leverage and buy or shorton margin.
Pre- and post-market trading sessions allow investors to trade stocks between the hours of 4 a.m. and 9:30 a.m. during pre-market trading, and 4 p.m. to 8 p.m. for the post-market sessions.
Premarket in SGT: 4 p.m. – 9:30 pm
Postmarket in SGT: 4 a.m. – 8 p.m.
The margin is the collateral that an investor has to deposit with their broker or an exchange to cover the credit risk the holder poses for the broker or the exchange. An investor can create credit risk if they borrow cash from the broker to buy financial instruments, borrow financial instruments to sell them short, or enter into a derivative contract.
Why is this important?
If you are looking to actively take profits or enter positions before the crowd, it is crucial to be able to participate in the pre and after market hours. This will allow you to react accordingly to major catalysts that could cause shares to skyrocket, allowing you to take a position early during the run up.
Buying and selling shares on margin effectively amplifies your buying power and provides you the option of being able to profit from a downtrending market as well.
However, do take into consideration that losses on margin are similarly amplified. You may also suffer margin calls if the losses are too great and your account does not have sufficient funds.
A margin call occurs when the value of an investor’s margin account falls below the broker’s required amount. An investor’s margin account contains securities bought with borrowed money (typically a combination of the investor’s own money and money borrowed from the investor’s broker).
What about the type of orders?
Both platforms also differ in the type of orders they have. Again, SaxoTraderGO has a greater selection of orders as compared to SaxoInvestor, which only has the basic types of orders.
Here is the full list of the types of orders that both platforms have.
A stop order is an order to buy or sell a security when its price moves past a particular point, ensuring a higher probability of achieving a predetermined entry or exit price, limiting the investor’s loss, or locking in a profit.
Algorithmic trading uses a computer program that follows a defined set of instructions (an algorithm) to place a trade.
*Algo orders offer a wide variety of strategy that you can use, including: dark, iceberg, implementation shortfall, limit on close, liquidity seeking, market on close, peg, pre-market limit, TWAP, VWAP, with volume
SaxoTraderGO thus has more options for experienced traders, allowing more freedom in the style of trading, such as setting stop losses or buying in different lots. Meanwhile, SaxoInvestor only has the basic market and limit which is still sufficient for investors who are newer to the trade.
SaxoTraderGO and SaxoInvestor have the same cost structure. There are 5 different tiers that you can get depending on how much you pay each month: bronze, silver, gold, platinum and diamond.
These tiers will dictate your commission prices and other costs, with diamond being the lowest in cost and bronze being the highest in cost.
For comparison purposes, we will be looking at the fees for the bronze tier.
SaxoTraderGO has a higher barrier to entry, with a minimum deposit of S$3,000 for your initial funding, but there is no minimum deposit after that. Meanwhile, SaxoInvestor has no minimum deposit at all.
However, both platforms require you to make a minimum of S$2,000 for the initial funding of a regular savings plan!
Any funding after initial deposit
Regular savings plan
For those getting into investing, S$3,000 may be a little too steep to begin with. SaxoInvestor is thus easier and less cumbersome for those starting their investing journey as compared to SaxoTraderGO.
Incentives for higher funding
Saxo Rewards also offers Platinum and VIP accounts if you have a large amount of funds in your account. If you trade quite often, you are also able to earn points which will be used to upgrade your account to higher tiers.