Endowus Launches New Factor Portfolios with Dimensional Funds

The new factor investing strategy was designed by Endowus with funds by Dimensional Fund Advisors to provide greater access and investment diversification options for clients.

Endowus, Singapore’s digital wealth platform has launched the Endowus Factor Portfolios by Dimensional. The new product seeks to bring greater access to low-cost and systematic funds, as well as broader diversification opportunities for retail investors. These portfolios are launched using funds by Dimensional Fund Advisors, a globally renowned, financial science-driven fund manager with over SGD900 billion in assets under management.

Endowus Factor Portfolios by Dimensional gain diversified exposure to long-term drivers of higher expected returns, such as value, size, and profitability in equities; and term and credit in fixed income, through systematic funds managed by Dimensional. Diversification is critical to long-term risk-adjusted returns and investor success. These portfolios are globally diversified across over 10,000 stocks in 43 markets and almost 900 government and corporate fixed income instruments.

Seven Dimensional funds are included in the new portfolios, including two newly incorporated SGD share classes of the US Core Equity Fund and the Emerging Markets Sustainability Core Equities Fund. These new share classes were launched in Singapore and seeded by Endowus and are available first on the Endowus platform. The two additional funds create greater diversification for the portfolios that balance the geographic and sectoral drivers. Similar to other Endowus portfolios such as Core, Satellite and Income, Factor offers clients the flexibility to choose and invest in the most appropriate portfolio aligned to their risk tolerance levels.

Samuel Rhee, Endowus Chairman and Chief Investment Officer said, “We are excited to bring systematic, institutional-grade, factor investing portfolios to retail investors in the Singapore market. As a fee-only digital wealth platform, Endowus is one of the few financial advisors with access to Dimensional funds in Singapore. We are aware that certain segments of our client base are financially trained and strongly favour funds by Dimensional given its proven track record and enduring commitment to financial science. We are thus extremely excited to continue growing our valued collaboration with Dimensional Fund Advisors to better serve the wealth goals of our clients.”

The developed and emerging markets equity solutions tilt exposures towards lower relative price, high profitability, and smaller capitalisation stocks, which are complemented by a systematic approach in fixed income that aims to capture term and credit premiums in a dynamic manner. 

Joel Kim, Chief Executive Officer, Asia ex Japan, Dimensional Fund Advisors said, “The new Endowus Factor Portfolios by Dimensional are an exciting evolution for Endowus investors. As a pioneer of factor-based investing, we are very pleased Endowus has implemented its asset allocations solely using Dimensional funds. The factor portfolios are strategic asset allocation solutions for investors of all risk profiles designed by Endowus that leverage Dimensional’s expertise in targeting higher expected returns in global equity and fixed income markets. Endowus continues to lead innovation in the digital wealth industry and we value the collaboration between Dimensional Fund Advisors and Endowus to offer solutions that meet the various needs of Singapore investors.”

“There is an extremely high level of trust and ethical considerations that comes into play when managing our clients’ capital at discretion. We are glad that our clients have provided positive feedback in our team’s management of various portfolios thus far. This has given us the confidence to launch the Endowus Factor Portfolios, where Endowus seeks to enhance the convenience and overall experience of our users through these innovative solutions,” added Gregory Van, Chief Executive Officer of Endowus. 

The new Factor Portfolios by Dimensional are managed in a discretionary manner by the Endowus Investment Office. This does not mean that Endowus makes any tactical changes to the asset allocation or  active discretionary trading. It maintains the core strategic, passive asset allocation framework for portfolio design that Endowus espouses. However, the discretionary management means investors can rely on Endowus’ expertise to monitor, automatically rebalance and optimise the asset allocation so that the portfolios deliver the highest risk-adjusted returns for the intended goals and appropriate risk suitable for our clients. The portfolios are currently available for existing clients and can be funded by Cash or SRS monies.