AutoWealth Plus+ Future of Digital Economy portfolio
In this article, I provide a detailed breakdown on Future of Digital Economy, one of the portfolios that AutoWealth is offering in their AutoWealth Plus+ product. You will also learn about all the Exchange Traded Funds (ETFs) that this portfolio will be investing in.
AutoWealth Plus+ charges an annual performance fee of 8% on the profits at the end of each calendar year, based on the portfolio value at the beginning and the end of the calendar year net of all fund deposits and withdrawals in USD terms throughout the calendar year.
I have also included a simulation of this portfolio based on a starting investment of $10,000 (minimum amount to start) and a monthly investment of $500 (minimum top-up amount) into the portfolio.
Please remember that the information presented is accurate as of the time of this post and past performance is not an indicator of future results.
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The Future of Digital Economy Portfolio is suitable for investors looking to capitalise on futuristics multi-year macro trends. The Future of Digital Economy Portfolio aims to provide above-market returns through its allocation to fintech, internet & ecommerce companies and some defensiveness against economic contraction & market volatility through its diversification in minimum volatility companies. Fintech companies provide technologically enabled product or service that changes the way the financial sector works. Internet companies empower the shifting technology infrastructure from hardware and software to the cloud, enabling mobile and local services. Ecommerce companies capitalise on the shift of consumer behaviour from traditional to online retail. Minimum volatility companies exhibit relatively lower volatility & drawdowns than comparable companies and are relatively more defensive against economic contraction & market volatility.
- Min to Invest: $10,000
- Total Holdings: > 300 stocks
- Dividend Yield: 0.82%
- Annual Fees: 8% on profits
- Geographic: Global
- Risk Rating: High
- Overall Rating: 5 out of 5 stars
Annual performance fees on USD profits, no fee will be charged if there is no profit for the calendar year.
- ARK Fintech Innovation ETF (37.2%)
- ARK Next Generation Internet ETF (31.4%)
- Amplify Online Retail ETF (14.9%)
- The Emerging Markets Internet and Ecommerce ETF (6.5%)
- iShares MSCI USA Min Vol Factor ETF (10%)
- Annualized Volatility: 30.39%
- Maximum Temporary Drawdown: -37.78%
- Sharpe Ratio: 0.91
- Recommended Investment Horizon: > 5 years
In view of the higher portfolio volatility, this portfolio is only recommended for users with idle cash and unwavering holding power.
Here's a look on this portfolio's asset allocation, market capitalization and sector exposures.
Below is a simulation of AutoWealth Plus+ Future of Digital Economy portfolio from 2020 to 2021 (as ARK Fintech Innovation ETF was only launched in February 2019), assuming a starting investment of $10,000 and a monthly investment of $500 into the portfolio.
Here are the annual returns and trailing returns based on the simulation above.
AutoWealth Plus+ performance-based fees
As an AutoWealth Plus+ portfolio, an annual performance fee of 8% on the profits in USD terms at the end of each calendar year, based on the portfolio value at the beginning and the end of the calendar year net of all fund deposits and withdrawals in USD terms throughout the calendar year. In the event the AutoWealth Plus+ portfolio is not in a profit position at the end of the calendar year, there will be no fees & charges for the calendar year. AutoWealth absorbs all brokerage fees, exchange clearing fees and custody fees irregardless.
Here's what the annual performance fees look like based on the simulation above.
Here is a breakdown of all the ETFs in AutoWealth Plus+ Future of Digital Economy portfolio.
ARK Fintech Innovation ETF (ARKF)
Total annual fund operating expenses: 0.75%
The Fund is an actively-managed exchange-traded fund (ETF) that seeks long-term growth of capital. It seeks to achieve this investment objective by investing under normal circumstances primarily (at least 80% of its assets) in domestic and foreign equity securities of companies that are engaged in the Fund’s investment theme of financial technology (“Fintech”) innovation.
A company is deemed to be engaged in the theme of Fintech innovation if (i) it derives a significant portion of its revenue or market value from the theme of Fintech innovation, or (ii) it has stated its primary business to be in products and services focused on the theme of Fintech innovation. The Adviser defines “Fintech innovation” as the introduction of a technologically enabled new product or service that potentially changes the way the financial sector works, which ARK believes includes but is not limited to the following business platforms:
- Transaction Innovations
- Blockchain Technology
- Risk Transformation
- Frictionless Funding Platforms
- Customer Facing Platforms
- New Intermediaries
Top 10 holdings (as of 22 Jan 2021)
Square Inc. A
Tencent Holdings Ltd ADR
Zillow Group Inc. C
Sea Ltd (ADR)
Pinterest Inc. A
Intercontinental Exchange Inc.
PayPal Holdings Inc.
Alibaba Group Holding SP ADR
Click here to learn out more about ARK Fintech Innovation ETF.
ARK Next Generation Internet ETF (ARKW)
Total annual fund operating expenses: 0.79%
ARKW is an actively-managed exchange-traded fund (ETF) that seeks long-term growth of capital by investing under normal circumstances primarily (at least 80% of its assets) in domestic and U.S. exchange traded foreign equity securities of companies that are relevant to the Fund’s investment theme of next generation internet.
Companies within the ARK Next Generation Internet ETF* (ARKW) are focused on and expected to benefit from shifting the bases of technology infrastructure to the cloud, enabling mobile, new and local services, such as companies that rely on or benefit from the increased use of shared technology, infrastructure and services, internet-based products and services, new payment methods, big data, the internet of things, and social distribution and media. These companies may develop, produce or enable:
- Cloud Computing & Cyber Security
- Big Data & Artificial Intelligence (AI)
- Mobile Technology and Internet of Things
- Social Platforms
- Blockchain & P2P
Top 10 holdings (as of 22 Jan 2021)
Teladoc Health Inc.
Square Inc. A
Grayscale Bitcoin Trust (Btc)
Tencent Holdings Ltd ADR
Spotify Technology S.A
Pure Storage Inc A
Facebook Inc. A
Click here to learn out more about ARK Next Generation Internet ETF.
Amplify Online Retail ETF (IBUY)
Total annual fund operating expenses: 0.65%
The Fund invests at least 80% of its total assets in global equity securities that comprise the Index, which will primarily include common stocks and/or depositary receipts, such as American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”). The Fund, using an indexing investment approach, attempts to replicate, before fees and expenses, the performance of the Index. Penserra Capital Management LLC (“Penserra” or the “Sub-Adviser”) serves as investment sub-adviser to the Fund. The Sub-Adviser seeks a correlation of 0.95 or better (before fees and expenses) between the Fund’s performance and the performance of the Index; a figure of 1.00 would represent perfect correlation. The Index was created and is maintained by EQM Indexes LLC (“EQM” or the “Index Provider”). The Index Provider is not affiliated with the Fund, Amplify Investments LLC (“Amplify Investments” or the “Adviser”) or the Sub-Adviser.
The Index seeks to measure the performance of global equity securities of publicly traded companies with significant revenue
from the online retail business. The Index methodology is designed to result in a portfolio that has the potential for capital appreciation. The Adviser and Sub-Adviser believe that companies with significant online retail revenues may be best positioned to take advantage of growth in online retail sales and shoppers versus companies with less significant online retail revenues. Eligible constituents derive at least 70% of revenues or $100 billion in retail sales from online and/or virtual business transactions (as opposed to brick and mortar and/or in-store transactions) in one of three online retail business segments: traditional online retail; online travel; and online marketplace.
Top 10 holdings (as of 25 Jan 2021)
Stitch Fix Inc.
Revolve Group Inc.
The RealReal Inc.
Qurate Retail Inc.
Lands' End Inc.
Click here to learn out more about Amplify Online Retail ETF.
The Emerging Markets Internet & Ecommerce ETF (EMQQ)
Total annual fund operating expenses: 0.86%
The Emerging Markets Internet & Ecommerce ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of EMQQ The Emerging Markets Internet & Ecommerce Index (the “Index”).
The Fund will normally invest at least 80% of its total assets in securities of the Index or in depositary receipts representing securities of the Index. The Index is designed to measure the performance of an investable universe of publicly-traded, emerging market internet and ecommerce companies. Companies eligible for inclusion in the Index will derive a majority of their assets or revenues from internet and ecommerce activities in emerging market nations (collectively, “Internet Companies”). Internet Companies include constituents from, but not limited to, companies in the following sectors, as defined by Big Tree Capital LLC (the “Index Provider”): Internet Services, Internet Retail, Internet Broadcasting, Internet Media, Online Advertising, Online Travel, Online Gaming, Search Engines, and Social Networks. Products and/or services of Internet Companies may include internet, mobile, and telecommunication valueadded services, online advertising, online direct sales, internet security software and services, mobile applications, e-mail service, web portals, electronic media subscription services, online entertainment, and online gaming services.
Internet Companies eligible for inclusion in the Index must hold a majority of their assets in or derive a majority of their revenues from one or more of the following 28 currently eligible emerging market or frontier market nations: Argentina, Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Kenya, Malaysia, Mexico, Morocco, Nigeria, Peru, Philippines, Poland, Qatar, Russia, South Africa, South Korea, Taiwan, Thailand, Turkey, United Arab Emirates, and Vietnam. From time to time, the Index may be more heavily weighted in a single country or a small number of countries.
As of December 1, 2020, Chinese and Hong Kong securities composed a significant portion of the Index.
Top 10 holdings (as of 21 Jan 2021)
Tencent Holdings Ltd
Alibaba Group Holding ADR
Naspers LTD N SHS
Baidu Inc. ADR
KE Holdings Inc.
Click here to learn out more about The Emerging Markets Internet & Ecommerce ETF.
iShares MSCI USA Min Vol Factor ETF (USMV)
Total annual fund operating expenses: 0.15%
The Fund seeks to track the investment results of the MSCI USA Minimum Volatility (USD) Index (the “Underlying Index”), which has been developed by MSCI Inc. (the “Index Provider” or “MSCI”) to measure the performance of large and mid-capitalization equity securities listed on stock exchanges in the U.S. that, in the aggregate, have lower volatility relative to the large- and mid-cap U.S. equity market.
In constructing the Underlying Index, MSCI uses a rules-based methodology to select securities from the MSCI USA Index (the “Parent Index”), which is a capitalization-weighted index, and to determine the weightings of such securities in the Underlying Index.
Under the rules-based methodology, securities and weightings of the Underlying Index are established based on pre-established parameters and discretionary factors are not relied on.
Top 10 holdings (as of 21 Jan 2021)
NextEra Energy Inc.
Vertex Pharmaceuticals Inc.
Johnson & Johnson
Gilead Sciences Inc.
T-Mobile US Inc.
Merck & Co. Inc.
Accenture plc Class A
Click here to learn out more about iShares MSCI USA Min Vol Factor ETF.