My aim is to refresh the investment options for expats in 2023. Offering low-cost actively managed portfolios by advisors with automatic rebalancing and trading in an all-in portfolio to give investors their time back for a small fee. Being one of the lowest-cost yet actively managed (to my knowledge) options for expats is something I pride myself on and want to increase in 2023. In this article, I want to explore a portfolio that can be automatically rebalanced and low-cost for busy expats.
The Rationale
Many Independent Financial Advisors (IFA) offshore charge 3% upfront and 1% a year for a portfolio that looks (and I would be happy to bet) and doesn’t normally perform much better than the benchmark.
This seems ridiculously high for an IFA to do next to nothing and underperform over the long term. So, I thought I would put a generic offer for investors with a 5-year plus time frame and a higher risk tolerance lowering the cost by doing a one-size portfolio that is grouped together for investors.
I looked at a portfolio for medium to high-risk investors. It looks into low-cost ETFs with an investment time frame of 5 years plus.
For more on the rationale behind why these funds have been selected please read my 2023 outlook and my review of 2022 as this will give an insight from a macro environment into why these certain funds have been selected. 2023 Outlook.
This portfolio will be rebalanced accordingly and at regular intervals, this will be automatically done by an active portfolio manager that will review it weekly.
Notes
Bonds –
This year more than last has put more of an emphasis on investment-grade short-term bonds. Although, the price might be subject to a decline at the start of 2023 believe due to interest rates staying high for the medium term and stable prices should be met with increased yields.
However, some investors, myself included, have found some returns in short-term bonds and notes.
Emerging Markets –
As stated in a few blogs do see some sectors in the EM markets as positive India, China, Indonesia, and Vietnam so wanted to cover a few broad ETFs.
Aims
To give expat investors a low-cost USD portfolio that is actively managed and rebalanced it is derived from the financial planning guidelines for asset class diversification and is made up of low-cost ETFs to cover the broad aspects and diversify risks.
With pivots towards asset classes that I believe have growth or value features for expats.
Platform
The platform cost is 0.28%-0.1%
The platform name is IFAST
https://secure.ifastnetwork.com/ifastverve/home/index.tpl
Actively Managed Fee- 0.25% (dealing costs apply). For a full breakdown please visit the website or ask me for more details.
Best Way to Use
The best use is the dollar-cost average. Averaging monthly payments with a 5-year time frame horizon.
Min investment- $1000 a month or $20,000 lump-sum at the start with top-ups.
If you are searching for an investment that is actively managed but this one doesn’t quite fit you, please email me,
Who this is not for?
Those with a low-risk tolerance. This is where you prefer safer investments such as savings accounts, and fixed returns and prefer the guarantee of investments rather than the ups and downs of equities.
A time frame of fewer than 5 years or looking for individual portfolio management.
Funds
All the funds listed are based in USD.
Disclaimers: Investments can go down as well as up and your capital is at risk. To make sure this investment is right for you, please contact me and I can make sure that this investment suits your lifestyle and situation.
Conclusion
For expats, I think offshore advisors have been able to charge fees where you would expect a good quality level of service, as returns aren’t guaranteed, and investments have not met their benchmark over the long-term. This is why I want to create a portfolio that is for investors who want to do something, have a time frame of more than 5 years, and have a risk profile of medium to high as the investments are mainly ETFs.
The main points I want expats to take away are:
- Low-cost charges (platform and advisor). There are still dealing charges
- Automatic rebalance
- 5-year plus time frame
- ETF Based portfolio
If you have any questions or wondering whether this is a portfolio for you please contact me and I can undertake a risk profile and a fact find.
There are minimums required.
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