Noted Investment Advisor Robert G Allen once said,
“How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.”
There are many ways to invest, like stocks, bonds, and mutual funds, but which one is the best? There’s no one perfect answer for one individual. What may be beneficial for some may not be for others.
Yet, it is always a tie between stocks, mutual funds and Stockal’s Stacks, as our clients tell us.
Stockal’s Stacks is a sturdy handout tool that offers the growth of wealth in the right direction. But how is it different from mutual funds? Dig in.
What is Stockal’s Stacks?
Stockal’s Stacks are pre-configured baskets of stocks and exchange-traded funds (ETFs) that can be invested in with a single click. The stocks and ETFs are readily arranged and put together by experts who have researched and financially analyzed it in depth.
The pre-made portfolio is developed by global asset management companies, experienced wealth management firms, and fund managers through extensive research, experience, and studies. The portfolio is based on products ranging from healthcare and electric vehicles to internet technologies, capital goods, etc.
Isn’t Stockal’s stack the same as Mutual funds?
The word mutual implies a group of people coming together, and funds mean the pooling of money. Therefore the term mutual funds represent a group of people investing their money together to buy stocks and bonds or both through teams or professional fund managers. The manager is in line with the investment objective of the scheme.
Mutual funds comprise of a company as well as investments. A stock of McDonald’s bought by an investor means purchasing partial ownership of the company. Similarly, investors of mutual funds buy partial ownership of a mutual fund company and its assets. Hence while McDonald’s is in a fast-food chain, a mutual fund company invests in a business.
Whereas Stockal’s stack active rebalancing portfolio assets help to ensure alignment with goals and benchmarks. It is similar to buying and selling of stocks with the added bonus of help from experts.
How’s Stockal’s Stack different from mutual funds?
In Stockal’s Stack, each stack has an “AUM Fee,” which is the percentage of the investment amount. The AUM fee can range between 1% to 5% of the investment amount, and it is changed periodically (either quarterly or annually).
The charges have been levied any way from 0.50% to 3.00% in mutual funds, depending on the holding period. There are transaction charges when the money is invested and recurring charges are based on daily net assets (DNA).
Stacks can be sold anytime like mutual funds, although some schemes like the Equity Linked Savings Scheme (ELSS) in mutual funds can not withdraw their funds until three years.
Mutual funds can be traded any day when the market is open. Trade orders are executed at the next available net asset value (NAV), which is determined after the market is closed on each trading day.
Stacks orders can be placed at any time, but the execution of the trade will take during market hours in the U.S.
Withdrawals in the stack are easy. The cash in the account of an account holder can be withdrawn through the withdrawal request. It takes 4–5 business working days to reach the domestic bank account of the account holder.
The timing of a withdrawal in mutual funds depends on several factors, including what time of day the withdrawal request is made and the institution receiving the funds. Most withdrawals take 3 or 4 business days.
Benefits of Stack
Tax efficiency: Stockal’s stack provides exchange-traded funds (ETFs) which are more tax-efficient than mutual funds because of how they are created and redeemed.
Fewer capital additions: ETFs additionally offer tax benefits to financial investors. With passively managed portfolios, ETFs, in general, acknowledge fewer capital additions than mutual funds.
Easy come and go: Stockal’s stacks are passively managed, they typically track a particular market, therefore, can be bought and sold swiftly like stocks.
Convenience: Stacks with an ETF can place trade immediately during market hours, whereas mutual funds investors have to wait until the end of the market trading day.
Higher returns: Stockal’s stack has moderately higher returns with calculated risk.
Examples of stacks
Some of the examples are Stockal’s stacks are Electric Vehicle Portfolio, Healthcare Leaders Portfolio, War & Peace.
Electric Vehicle Portfolio
The Electric Vehicles Stack is made out of organizations engaged with Electric Vehicle. This Stack centers exclusively around putting resources into EV organizations with high development potential and having moderately low risk. EVP has garnered 37.86% returns over 3 years.
Healthcare Leaders Portfolio
HLP centers around the medical innovations and treatments being created by the top-performing U.S. drug and biotechnology companies. HLP has seen an expansion of 15.72% growth over 1 year.
War & Peace
W&P provides capital growth and preservation for steady investors. Investments in consumer staples; equity in prestige companies like Microsoft and Google; utilities; healthcare; and Data Centers Real Estate. The growth rate of W&P has been 18.3% in the past year.
So what are we saying, really?
Stockal’s Stack is a simple yet effective way to start an individual’s investment journey. With no stress to focus on market trends and analysis and the fear of misinforming stocks. The pre-managed portfolio provided by research-backed tools helps clients diversify their investments or grow in their invested assets. Stockal’s stack one-stop solution to begin the investment journey.
