Investing in the S&P 500 is one of the most popular choices for those looking to build long-term wealth, thanks to the index’s history of steady growth and its inclusion of some of the world’s most successful companies.
But for investors in Malaysia, getting easy access to the S&P 500 isn’t always straightforward, especially when factoring in fees, currency conversion, and platform limitations.
Read my article on 3 Easy Ways to Invest in S&P500 as a Malaysian
That’s where StashAway Malaysia comes in. Known for its user-friendly app and automated investing approach, StashAway has become a top choice for Malaysians seeking exposure to U.S. markets, particularly through the S&P 500.
In this post, I’ll walk you through my experience using StashAway Malaysia to invest in the S&P 500.
What is StashAway?
StashAway is a digital wealth management platform designed to make investing accessible and hassle-free for everyone.
Founded in Singapore, it has quickly gained traction across Southeast Asia, offering a range of portfolios that cater to different risk appetites and investment goals.
StashAway’s main attraction is its data-driven, algorithm-based investment approach, which aims to provide users with a diversified portfolio tailored to their specific risk level and financial goals.
Why I Chose StashAway Malaysia for S&P 500 Investing
When I first started exploring investment options, my goal was simple: I wanted exposure to the U.S. market, particularly the S&P 500, which is known for its historical stability and solid long-term returns.
With the S&P 500’s track record as a benchmark for the U.S. economy and major corporations, I saw it as an ideal choice for building a core, diversified foundation in my portfolio.
But as a first-time investor looking for convenience and a supportive platform, I had to find a way to do it that wouldn’t feel overwhelming or overly complicated.
Read my article on my experience investing in the S&P500 using 3 different platforms!
The Appeal of StashAway’s User-Friendly Platform
One of the reasons StashAway Malaysia stood out to me was its reputation for ease of use. Investing can feel daunting with all the different terminologies, fees, and decisions to make.
But StashAway’s platform is designed to be intuitive, with a smooth onboarding process and simple navigation.
They don’t assume that every user has a deep understanding of finance, so they provide explanations along the way, making the whole process accessible.
Flexible Portfolio Options for S&P 500 Exposure
While there are a few ways to gain exposure to the S&P 500 in Malaysia, StashAway’s flexible portfolio option is particularly appealing.
The option to allocate up to 99% into IVV (iShares Core S&P 500 ETF), which provides me with nearly direct access to the S&P 500’s growth without having to navigate complex asset selection.
Lower Minimums and a Structured Fee Model
Another aspect that drew me to StashAway was the relatively low minimum investment amount.
I wanted to start small and see how the platform worked for me before committing a larger sum. StashAway allowed me to do just that without any pressure.
Their fee structure is also quite clear, with charges based on assets under management rather than hidden fees or transaction costs.
Fees for Investing in the S&P 500 via StashAway:
1. Management Fees:
- Annual Management Fee Structure for portfolios that include S&P 500 exposure (e.g., through the iShares Core S&P 500 ETF – IVV):
- First RM50,000: 0.8%
- RM50,001 – RM100,000: 0.7%
- RM100,001 – RM250,000: 0.6%
- RM250,001 – RM500,000: 0.5%
- RM500,001 – RM1,000,000: 0.4%
- RM1,000,001 – RM3,000,000: 0.3%
- Above RM3,000,000: 0.2%
2. Single ETF Flexible Portfolio:
- Management Fee: 0.3% annually (no minimum balance required).
- Expense Ratio Charged by ETF Manager: Approximately 0.2% per annum.
3. Additional Fees:
- No Account Setup or Exit Fees: No charges for opening or closing an account.
- Unlimited, Free Withdrawals and Transfers: Withdrawal or transfer funds between portfolios without incurring fees.
- No Rebalancing, Transaction, or Re-optimization Costs: All related costs are included in the management fees.
4. Currency Conversion Fees for USD Portfolios:
- FX Spread: 0.29% per currency conversion for USD-based investments, which is competitive compared to industry averages.
Read more about StashAway’s fees here!
Getting Started: My Initial Setup and Portfolio Allocation
I’d heard that the platform was easy to navigate, but I wasn’t sure what to expect from the onboarding process, especially as I wanted my portfolio to be focused solely on the S&P 500.
Here’s a breakdown of my setup experience and how I tailored my portfolio to get the exposure I wanted.
Creating My Account
The account setup was straightforward and well-guided. StashAway’s onboarding process asked a few basic questions about my financial goals, risk tolerance, and investment horizon.
Customizing My Portfolio with StashAway’s Flexible Allocation
Using their Flexible Portfolio feature, I was able to allocate a significant portion of my investments into the iShares Core S&P 500 ETF (IVV), giving me close tracking to the S&P 500 index.
For me, the idea of having up to 99% in IVV was incredibly appealing, as it allowed me to focus my investments without worrying about manually buying and balancing individual stocks.
Setting My Initial Investment Strategy
Once my portfolio was set up, I started thinking about how much to invest initially.
Since I was still learning the ropes with StashAway, I decided to start small with RM100.
This approach allowed me to get comfortable with the platform and observe how the S&P 500 performed without feeling too financially committed upfront.
Choosing my Payout Preference
StashAway lets me choose to reinvest my dividends or to withdraw to my bank account.
Only thing to note is that the withdrawal to the bank account is only applied to payout amounts above RM25.
Pros and Cons of Investing in the S&P 500 via StashAway Malaysia
As I continue my investment journey with StashAway Malaysia, particularly with a focus on the S&P 500, I’ve come across several advantages that make the platform a great fit for my goals.
Here’s a look at the pros and cons of using StashAway Malaysia for S&P 500 investing, based on my personal experience.
Pros
1. Ease of Use and Accessibility: StashAway’s platform is incredibly user-friendly, making it ideal for beginners.
2. Flexible Portfolio Options for S&P 500 Exposure: One of the biggest advantages of StashAway is its Flexible Portfolio, allowing users to allocate up to 99% of their portfolio to the iShares Core S&P 500 ETF (IVV).
3. Transparent and Structured Fees: Unlike some platforms with hidden fees or high transaction costs, StashAway charges a transparent management fee based on assets under management.
Cons
1. Limited Customization Options Beyond ETFs: While StashAway’s Flexible Portfolio is a great feature, customization is still limited to ETFs, particularly if you’re interested in individual U.S. stocks or other specific funds. For investors who want more precise control over individual assets within their S&P 500 exposure, this limitation can feel restrictive.
2. Management Fees Compared to DIY Options: Although StashAway’s fee structure is transparent, it may be higher than other DIY investment options like brokerage accounts. For investors who are comfortable managing their portfolios, direct investment through platforms like Rakuten Trade could offer lower fees.
Read my article on my review of Rakuten Trade Malaysia
3. Limited Availability of Specific ETF Ticketers: While StashAway offers the IVV ETF for S&P 500 exposure, there’s no option to choose other similar ETFs, like VOO (Vanguard S&P 500 ETF), which some investors may prefer for reasons like expense ratio or tracking accuracy.
4. Lack of Immediate Liquidity: Although StashAway allows for withdrawals, the process may take 3-4 business days to complete. This lack of instant liquidity could be a drawback for those who may need quick access to their funds in an emergency.
Conclusion
StashAway was one of the first investing platforms I tried, and it holds a special place in my heart.
Although I lean toward DIY investing through brokerages, I still appreciate StashAway for its simplicity and ease of use, which make it an excellent option for hands-off investing.
The platform’s user-friendly design, automated features, and flexible portfolio options make it a strong choice for anyone looking to gain exposure to the U.S. market without the hassle of managing every investment detail.
Have you tried StashAway? Or are you thinking about starting? I’d love to hear about your experiences and any questions you may have!
Drop a comment below to share your thoughts, or feel free to reach out directly to me via email [email protected]
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