Auto-Invest is designed to help investors quickly and efficiently allocate their funds to available, investment opportunities in a hassle-free manner.
What is Auto Invest?
Auto Invest will allow investors to choose from two different investment strategies: The Balanced Strategy and the Conservative Strategy. Each strategy offers different returns and risk levels, so investors can choose the one that best fits their investment goals and risk tolerance.
The Balanced Strategy offers returns of 11-13% per annum. This strategy is ideal for investors who are looking for a balance of returns and risk. The algorithm will invest your funds in a diversified portfolio of 10-20 A & B rated businesses, capping your exposure per business to 10% or less.
Let's say you invest AED 100,000 at 13% per year for 12 months in a portfolio of 20 businesses. This means that your exposure per business will be roughly 5%. Given the portfolio performs as expected you will receive monthly installments amounting to 113,000 in 12 months. Even if one company fails, your capital will remain intact, and you'll still earn a 7.35% profit instead of the projected 13%. Diversifying your investments protects your capital, and based on our past three years of performance, it is unlikely that more than one business will fully default in each portfolio.
The Conservative Strategy offers returns of 8-11% per annum. This strategy is ideal for investors who are looking for low-risk investments and prioritize capital preservation over returns. Our algorithm will invest your funds in only A-rated businesses, which are generally guaranteed by a financial guarantee from a government entity.
For example, Sharjah Media City offers a full financial guarantee, covering the principal as well as the profit. If you invest AED 100,000 at 9% per year for 12 months, you should receive monthly payments totaling 109,000. If the business defaults, Sharjah Media City will repay any outstanding amount that is owed to you. We are proud to be in this partnership and we believe it is one of the best fixed-income investment deals available.
What benefits will I as an investor receive from enabling this feature? As an investor, activating Auto Invest on Funding Souq will provide you with several benefits.
- Convenience: By activating this feature, you can set your investment strategy and let the algorithm handle the rest. You won't have to constantly monitor the platform for businesses to invest in, saving you time and effort.
- Diversification: The Auto Invest feature allows you to diversify your investments across a range of businesses, which can help reduce risk and increase your earning potential.
- Higher returns: The Auto Invest feature allows you to potentially earn higher returns by re-investing monthly your repayments whilst maintaining your exposure per business at 10% or less.
Tailored experience: Each strategy offers different returns and risk levels, so you can choose the one that best fits your investment goals and risk tolerance.
Overall, activating the Auto Invest feature on Funding Souq can help you manage your investments more efficiently, diversify your portfolio, and potentially earn higher returns