Robo Advisors Singapore Market

Syfe Cash+ Guaranteed Review: Up to 4% Yield Fixed Rate with Multiple Term Options

Calvin Lo

Syfe Cash+ Guaranteed portfolio was launched to complement the existing Cash+ portfolio (now renamed Cash+ Flexi).

Update as at 20 Dec 2023:

Syfe Cash+ Guaranteed offers a very attractive 4% p.a. fixed rate for a fixed lock-in term of 3 months. Longer terms of 6 and 12 months are also available at fixed rates of 3.9% p.a. and 3.7% p.a. respectively.

Pros

The underlying product are fixed deposits placed with Singapore banks, which are relatively safer than money market funds. Funds placed with Cash+ Guaranteed are capital guaranteed, subject to the underlying bank risk.

In contrast, the underlying product for Cash+ Flexi are money market funds (currently 70% LionGlobal SGD Enhanced Liquidity Fund Class I (Accumulation) and 30% LionGlobal SGD Money Market Fund). As at time of writing, Cash+ Flexi is offering a slightly lower projected yield of 3.7% p.a.

The great thing about Cash+ Guaranteed is that Syfe will optimise the rates from Singapore banks so you don’t have to shop around for the best rates after every maturity term.

Another important feature is that Cash+ Guaranteed does not require any minimum placements unlike most fixed deposits offered by Singapore banks. In addition, management fee is currently also waived.

Cons

Compared to fixed deposits directly placed with banks, funds placed with Cash+ Guaranteed are not SDIC-insured, so you are taking on slightly higher risk.

There isn’t an option for longer term tenures, although you can opt for auto-renewing at the end of the tenure. However, rates could change by then at the point of renewal.

Compared to Cash+ Flexi, funds placed with Cash+ Guaranteed are locked-in for the fixed term chosen, i.e. you won’t be able to withdraw funds prematurely and have to wait until maturity. That said, 3-12 months is a relatively short period of time. You could also consider placing several portfolios that mature at different dates (a.k.a. laddering) if you want greater flexibility with your funds.

Market Comparison

How does the rate offered by Cash+ Guaranteed compare to other similar products in the market?

See my Fixed Income Tracker, which I try to update regularly.

T-bill: First, let’s compare vs government-issued Treasury Bills or T-bills which are one of the safest products in the market. The latest 6-month T-bill cut-off yields on 20 Dec 2023 auction was 3.73%. Although relatively safer, T-bills require minimum amount of $1,000 and locks-in your money for 6 or 12 months.

SSB: Another good data point of comparison are Singapore Savings Bond or SSB. Next month’s Jan 2024 SSB is offering 3.07% average 10-year yield. SSB tenure is much longer at 10 years, but can also be redeemed early without penalty.

Other robo-advisors: StashAway also offers a similar product called StashAway Simple Guaranteed, which also offers 4% p.a. for the same 3-month tenure (see below table for yield on other tenures). Similarly, Simple Guaranteed also finds the best rates from fixed deposits of MAS-regulated banks in Singapore. Most other features are pretty similar to Syfe Cash+ Guaranteed.

Read: StashAway Simple Guaranteed Review: Up To 4% Yield Cash Management Product Invested in Fixed Deposits

My Take

Bank savings account like SSB Bonus$aver and UOB One account can offer higher interest rates but require you to meet several qualifying criteria every month.

T-bills are yielding slightly lower but is a safer option since it is backed by Singapore government), but yields have been falling. Also, there might be a few days gap between when your T-bill matures and when you can secure another issuance so that small advantage might be neutralised there. Note: I’ve not done a calculation to verify this, and have not had any of my T-bills mature yet.

Since Syfe Cash+ Guaranteed has a short tenure of 3 months and offers relatively high yield of 4% at the moment, I think it’s a pretty attractive option to park your short-term cash.

If you need maximum flexibility to withdraw your funds anytime, you might want to consider Cash+ Flexi instead, which is currently offering a projected 3.7% p.a. for SGD and projected 5.4% p.a. for USD (but be wary of foreign currency risk).

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Disclaimer: This is not financial advice. I am not professional financial advisor nor do I work in the finance industry. Anything I write here is purely my personal opinion. Please do your own research and due diligence before investing into anything. All investments come with associated risks. Best to consult a financial advisor if you’re still unsure.

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