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Jorden

ETFs Invest

IWDA vs VTI – What’s The Difference?

IWDA vs VTI2

Last updated on January 8th, 2022

If you are looking to diversify your portfolio, you probably would have come across IWDA and VTI. Both these 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?

Here is what you need to know to help you decide:

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Brokers Invest

SaxoTraderGo vs SaxoInvestor – What’s The Difference?

SaxoInvestor vs TraderGo

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.

SaxoTraderGO demo account user interface
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SaxoInvestor demo account user interface

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 Description
StocksOver 19,000 stocks across 37 international exchanges
BondsOver 5,000 government and corporate bonds
ETFsOver 3,000 exchange traded funds across over 30 exchanges
Mutual fundsOver 500 mutual funds with global investors
Managed portfoliosDefensive to aggressive portfolios adjusted to your goals
Regular savings planDefensive 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 Description
Forex182 major, minor, and exotic FX pairs
CFDsOver 9,000 on stocks, indices, forex, commodities, options, or bonds
FuturesOver 200 futures across 23 exchanges internationally
CommoditiesTrade spot metals, corn, and Brent Crude or WTI crude oil
Forex options44 Forex vanilla options across major pairs
Listed optionsOver 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.

Functions

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:

  1. Buying on margin
  2. Shorting on margin
  3. Premarket
  4. Postmarket

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 short on margin.

Purchasing on pre and post market on SaxoTraderGO

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.

Investopedia
  • 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.

Investopedia

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).

Investopedia

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.

Order Type Description
MarketA market order is an instruction by an investor to a broker to buy or sell stock shares, bonds, or other assets at the best available price in the current financial market.
LimitA limit order is a type of order to purchase or sell a security at a specified price or better.

And here are additional orders that are only found on SaxoTraderGo.

Order Type Description
StopA 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.
Trailing stopA trailing stop is a modification of a typical stop order that can be set at a defined percentage or dollar amount away from a security’s current market price.
Stop limitA stop-limit order is a conditional trade over a set time frame that combines the features of stop with those of a limit order and is used to mitigate risk.
One cancels the other (OCO)A one-cancels-the-other (OCO) order is a pair of conditional orders stipulating that if one order executes, then the other order is automatically canceled. 
Algo (strategy*)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.

Types of orders for SaxoTraderGO
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Types of orders for SaxoInvestor

Fees

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.

Type of FeesAmount
SGX0.08%, min. $5 SGD
NYSE0.06%, min. $4 USD, capped at 100 USD
HKEX0.15% min. $90 HKD
ASX0.10% min. $8AUD
TSE0.15% min. 1,500 JPY
Forex 0.7 pips for EUR/USD, 1.1 pips for USD/SGD
Annual custody fee (if opted into securities lending)0.06%
Annual custody fee (if opted out of Securities Lending)0.12%

Here are the full details for the other tiers and other costs that you will have to incur if you trade on these platforms.

You may want to note that you will only incur monthly fees if you subscribe to the abovementioned tiers or for their equity market data subscriptions.

Funding

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!

SaxoTraderGO SaxoInvestor
Initial depositMinimum S$3,000Nil
Any funding after initial depositNilNil
Regular savings planMinimum S$2,000Minimum S$2,000

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.

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Depositing into SaxoTraderGO via Wire Transfer

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.

Classic Platinum VIP
Min. initial funding: USD 10,000Min. initial funding: USD 250,000Min. initial funding: USD 1,250,000
Tight entry pricesUp to 30% lower pricesThe very best prices
Best-in-class digital service and supportBest-in-class digital service and supportBest-in-class digital service and support
24/5 technical and account support24/5 technical and account support24/5 technical and account support
Local-language personal relationship manager
Direct access to trading experts, 24/7
1:1 SaxoTrats access
Exclusive event invitations

Availability

Both SaxoTraderGO and SaxoInvestor have the same platform availability, including:

  1. Desktop
  2. Apple App Store
  3. Google Play Store

Verdict

Here is a comparison between the SaxoTraderGO and SaxoInvestor platforms:

SaxoTraderGO SaxoInvestor
Available financial productsMoreLess
FunctionsMoreLess
Difficulty to useHarder to navigateEasier to navigate
FeesSimilarSimilar
FundingMin. S$3,000 for
the initial deposit
Nil
AvailabilitySameSame

So which platform should you use?

Choose SaxoTraderGO if you want a more comprehensive trading experience

SaxoTraderGO offers more financial products and functions that give you the flexibility to make more advanced trades.

You will be able to trade on margin and have the ability to profit from downward moving markets with SaxoTraderGO as well. This will help to increase your effectiveness as a trader.

SaxoTraderGO is thus a better platform if you’re a seasoned trader, or if you’re looking to amp up their trading experiences.

Choose SaxoInvestor if you want to learn more about investing

SaxoInvestor has an easier user interface to navigate which will be less daunting if you’re new to investing.

With just the basic products and no complicated functions, you will be less likely to be overwhelmed by the number of options available if you’re a newer investor.

Conclusion

Both platforms allow you to purchase financial products and begin your investing or trading experiences.

The main considerations you should consider include:

  1. If you want to invest over the long term or take trades in the short term
  2. Want more complex functions at the cost of a more difficult user interface to navigate
  3. Your initial funding costs

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ETFs Invest

CSPX vs IWDA – What’s The Difference?

CSPX vs IWDA

Both CSPX and IWDA are funds under the iShares Core ETFs which are designed to provide you with immediate access to a diverse basket of stocks.

With both ETFs being a decent choice to diversify your portfolio, you may be wondering what are the key differences between these two indices, and which should you invest in?

Here is what you need to know to help you decide:

The difference between CSPX and IWDA

CSPX is a fund that tracks the performance of the Standard & Poor’s 500 Index (S&P 500), a benchmark made up of the biggest 500 large-cap stocks from the US. In contrast, IWDA is a fund that tracks the performance of the MSCI World Index, which includes 1560 holdings from across 23 different countries with different market caps.

The funds thus differ in the type of markets they expose you to, with the main difference between the number of countries they pull stocks from.

The similarities between CSPX and IWDA

The manager of both funds is BlackRock, one of the largest asset managers in the world. BlackRock has over $5 trillion in assets under management and offers a wide range of investment options for investors such as these two indices.

Both funds are also traded in USD on the London Stock Exchange (LSE) and are accumulating funds. This means that any dividends earned from the fund will automatically be reinvested into itself, increasing the value of your investment.

If you’re wondering what’s the difference between accumulating and distributing funds, you can view this comparison to find out more.

CSPX and IWDA are Ireland-Domiciled ETFs as well, benefitting from the US/Ireland tax treaty rate of only 15%. In contrast, if you were to invest in an ETF on the US stock market, you will have to pay a tax of 30% on dividend income as Singapore does not have a tax treaty with the US.

What’s more, you get to save on the rather hefty US estate tax as well.

As such, investing in CSPX and IWDA will be better for you compared to their US counterparts as you will save 15% from dividend income taxes.

Unit Price

The unit price of each ETF is the price you’ll need to pay for 1 unit. 

CSPX and IWDA have vastly different unit prices, with CSPX being almost more than 5 times more expensive than IWDA as of 15th December 2021.

CSPX IWDA
Estimated Unit Price $476 USD $87 USD

This makes IWDA a lot more accessible to invest in if you have a smaller amount you are able to invest in! IWDA is thus a cheaper way to diversify your portfolio if you are newer to investing.

Country diversification

CSPX includes US companies that fall under one of the 500 largest companies from the US that have a market capitalization of at least USD 11.8 billion.

On the other hand, IWDA includes holdings from 23 different developed countries. Here is the geographical breakdown in percentage of the shares IWDA has a stake in.

Country Weightage
United States68.32%
Japan6.41%
United Kingdom 4.09%
France3.29%
Switzerland3.20%
Germany2.80%
Australia2.52%
Netherlands1.98%
Sweden1.43%
Other 14
developed countries*
4.89%

*Austria, Belgium, Canada, Denmark, Finland, Hong Kong, Ireland, Israel, Italy, New Zealand, Norway, Portugal, Singapore, Spain

What does this mean for investors like you and me?

IWDA may be a better option if you are looking for a greater diversity of countries to invest in. Meanwhile, if you have a high conviction of the US market, CSPX may be a better option as all of its holdings fall in the US.

Types of stocks

CSPX contains the top 500 large cap companies from the US while IWDA contains the 1560 holdings which include both large and mid cap companies in developed countries.

A large cap company is one that has a market capitalisation of more than $10 billion.

Meanwhile, a mid cap company has a market capitalisation between $2 to $10 billion.

Investopedia

The market cap of a company can be determined by multiplying the stock price by the number of outstanding shares.

This is because of the indices that both ETFs track. If you’re interested in finding out more about the differences between the MSCI World Index and the S&P 500, here’s a comparison for you.

Top Sectors

Here is a comparison between the top 5 sectors that are found in CSPX and IWDA as of 3rd December 2021.

CSPX IWDA
Information Technology (IT) 28.9%Information Technology (IT) 23.5%
Consumer discretionary 12.9%Financials 13.3%
Healthcare 12.8%Consumer Discretionary 12.5%
Financials 10.9%Healthcare 12.3%
Communication 10.3%Industrials 10.2%

Both funds have very similar weights, with IT being the top sector of both CSPX and IWDA with 28.9% and 23.5% respectively. 

Since IT has been one of the fastest growing sectors in the past few years, the difference in the percentage of holdings in IT may skew in the favour of CSPX. This will be explored further in the difference in performance below.

Apart from a few slight differences, either one of the funds will give you a fairly balanced diversification, with a major portion of your investment in IT.

Top holdings

Now, let us take a look at the top 5 holdings of each of the funds.

CSPX IWDA
Apple 6.6%Apple 4.7%
Microsoft 6.3%Microsoft 3.9%
Amazon 3.8%Amazon 2.6%
Alphabet Inc A (Google) 2.2%Tesla 1.5%
Tesla 2.1%Alphabet Inc A (Google) 1.4%

Again, we can see that both CSPX and IWDA have very similar top holdings. The only difference is the stock allocation, with CSPX having a slightly higher allocation in these companies.

As these companies have been powerhouses in growth in the last 5-10 years, this has given CSPX a bit of an edge in growth as well.

Performance

Both funds have performed very well in the past 5 years, with CSPX having an average annual return of 17.4% while IWDA having a 13% average annual return.

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5 year performance for CSPX
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5 year performance for IWDA

If you were to purchase both funds 5 years ago, you would be up 123.7% for CSPX (more than double your initial investment). IWDA on the other hand, would have returned 82.4%.

As explained above, CSPX has outperformed IWDA by a small margin as it has a greater proportion of its holdings in the top US companies. These US companies have led the growth in the global economy, especially with major companies like Apple and Microsoft who are the biggest in the world.

However, past performance does not indicate future returns, so it will be good to do your own research first, before investing in either fund!

Expense ratio

On top of the trading commissions you’ll need to pay to the broker, you will have to pay an expense ratio to the fund manager as well.

The expense ratio is charged by the fund manager to cover the costs of running the fund.

Based on the value of your assets in the fund, you will be charged an annual fee.

Here are the expense ratios for these 2 funds:

CSPX IWDA
Expense Ratio0.07%0.20%

The expense ratio of CSPX is slightly lower than IWDA. This means that over time, you would be paying lower fees if you were to invest in CSPX as compared to IWDA.

As such, you may want to take this into consideration when deciding which to invest in! 

Liquidity

If you are looking to actively trade using these ETFs, you may want to look at their liquidity. One of the indicators you may want to look at is the ETF’s average trading volume.

CSPX IWDA
Average Trading Volume69,506344,762

IWDA has a much higher trading volume than CSPX. However, as both of these funds are listed in the LSE, they are much lower compared to the S&P 500 ETFs which are listed on the NYSE.

Verdict

Here is a comparison between CSPX and IWDA:

CSPX IWDA
Type of stocks Large cap US equitiesLarge and mid cap equities from 23 developed countries
Unit priceHigherLower
Number of holdings5051560
Top sectorsInformation Technology (IT) 28.9%
Consumer
discretionary 12.9%
Healthcare 12.8%
Financials 10.9%
Communication Services 10.3%
Information Technology (IT) 23.5%
Financials 13.3%
Consumer
discretionary 12.5%
Healthcare 12.3%
Industrials 10.2%
Exposure to global economyGoodSlightly stronger
Expense ratioLowerHigher
LiquidityLowerHigher
Past performanceStrongerWeaker

So which index should you choose to invest in?

Choose CSPX if you are confident in the US economy.

CSPX tracks the S&P 500 which has historically been one of the best performing indices. Tracking the very best companies in the US, you are theoretically buying into the US economy as a whole

CSPX has survived and eventually climbed to all-time highs after every major crash in the past decade. As such, investing in CSPX is a rather safe way of buying into an already diversified portfolio

If you are looking for flat numbers, CSPX also just outperforms IWDA in its average annual returns. With a higher concentration in the US market, as the global economy continues to be led by the US’s economic growth, CSPX will continue to outperform IWDA in the long run.

Despite this, you may want to take note that CSPX is still very concentrated in just the US.

Choose IWDA if you want a more diversified portfolio across multiple countries.

IWDA has more than 3 times the amount of holdings than CSPX and is diversified across 23 different developed countries. Even though it may still have the majority of its holdings in the US (68.32%), it is still more diversified than CSPX which is limited to only the US.

Despite not performing as well as CSPX, IWDA has also similarly climbed to all time highs after major crashes. An average annual return of 13% is still a healthy amount for a long term investment.

IWDA is also more insulated against a major crash in the US stock market as it still has over 30% of its holdings held in other countries. This makes IWDA a relatively safer investment if you are slightly more risk averse.

In the event that another country outperforms the US, you will still be able to be exposed to it, as compared to CSPX which is solely concentrated in the US!

Conclusion

Both funds allow you to purchase into a diversified portfolio that can benefit from the growth in the global economy. 

The main considerations you should have include: 

  1. How confident you are in the US market
  2. How diversified you want to be outside of the US market
  3. Your personal risk level

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Indices Invest

S&P 500 vs FTSE 100 – Which Is Better?

FTSE 100 vs SP 500

The S&P 500 has always been one of the most prominent indices in the world. However, you may have heard of other indices too, such as the FTSE 100.

What are the key differences between these two indices, and which should you invest in?

Here is what you need to know to help you decide:

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Indices Invest

STI vs S&P 500 – What’s The Difference?

STI vs SP 500

With the S&P 500 being one of the most popular indexes out there, you may be wondering how Singapore’s very own Straits Times Index (STI) may fare against it.

What are the key differences between these two indices and which should you invest in?

Here is what you need to know to help you make a decision:

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