Just after I posted the Crypto Update on LUNA 2.0 Airdrop this morning, I’m pleased to see Tokenize Exchange announced on their Facebook page that they have changed their stance to support LUNA 2.0 Airdrop:
In summary, my existing LUNA holdings with Tokenize Exchange would be renamed as LUNA Classic (LUNC). Part of my LUNC holdings was bought pre-attack, and the remaining post-attack. I would get 30% for both at genesis, and the remaining 70% vested over 2 years after a 6-month cliff.
A glimpse of hope to recouping some value from my LUNC holdings.
LUNA founder and CEO Do Kwon came up with a revival plan, called Terra Ecosystem Revival Plan 2, which was approved on 25 May 2022.
The plan essentially creates a new Terra blockchain that doesn’t have an algorithmic stablecoin, basically distancing itself from the death spiral effect seen in the UST Depeg Saga (refer to my blog post “Crypto Investment Update – UST Depeg Saga” on its impact to my crypto portfolio).
The old chain would be called Terra Classic (LUNC) and the new chain will retain the LUNA ticker. There will be an airdrop of LUNA tokens to LUNC holders and stakers, as well as residual UST holders and essential app developers of LUNC. Below is a summary of this revival plan:
The distribution of the new LUNA tokens would be based on 2 snapshots, “Pre-attack” and “Post-attack”, which are recordings of the state of the LUNC block 7544910 and 7790000 on 7 May 2022 and 27 May 2022 respectively. The details of the token distribution and snapshot timings are shown below:
Following the approval of this LUNA 2.0 airdrop, a few centralized exchanges (CEX), including Binance, Huobi, Bitfinex, FTX, Kraken, etc., had announced supports of the airdrop. Surprisingly, some popular CEX like Coinbase had decided to wind down support for the new LUNA chain (see Coinbase tweet here).
As for my LUNA holdings in Tokenize Exchange, they have sent a LUNA Airdrop Updates at 8pm on 26 May 2022 announcing they will not be supporting the upcoming LUNA 2.0 airdrop (see image below).
It goes without saying that I’m disappointed with Tokenize Exchange not supporting the airdrop. Without their support, I had missed the LUNA airdrop for both the “Pre-attack” and “Post-attack” snapshots. Unless Terra ecosystem opens up token distribution to those caught off-guard in similar situation, I would have to write off my LUNA holdings.
The only consolation I have with my “misadventure” in LUNA, is that I recovered my capital in LUNA when I took partial profit in December 2021. My current LUNA holdings is on the house money.
As for my overall crypto portfolio, the UST Depeg Saga dragged it to negative territory. I can only pin my hope on the recovery of my other coins holdings for the portfolio to turn profitable.
So I decided to insert a post between my monthly performance update to examine the cost of the 5 robo advisor portfolios. Here is the cost comparison table as of 21 May 2022:
The fees consist of 2 parts, one from the underlying invested funds (fund level fees) and the other from the robo advisors. Both Endowus and MoneyOwl are investing using unit trusts, whereas Syfe, StashAway and SquirrelSave are using ETFs. The following sections would cover the cost structure of the 5 robo advisors.
Endowus Equity 100 Portfolio
Endowus portfolio consists of 4 unit trusts, 3 of which are Dimensional unit trusts, with different fund level fees (Total Expense Ratio, TER). Endowus would credit the trailer fees rebates quarterly, hence reducing the net fund level fees. We derive the net fund level fees by calculating the sum of the product of allocation and net fees, and then add the access fees of 0.6% for cash investment to get the total fees.
The overall cost structure is tabulated in the following image:
MoneyOwl Equity 100 Portfolio
MoneyOwl portfolio consists of 2 Dimensional unit trusts, one for Global Core Equity and the other for Emerging Markets Large Cap. There is no trailer fees for Dimensional funds.
See the following image for the cost structure:
Syfe Equity 100 Portfolio
Syfe portfolio invests in many ETFs, of which the composition and allocation would change over time. Interestingly, they have MCHI and KWEB in the portfolio, both are investing in China equities and formed about 17% allocation of their portfolio.
The following cost structure is based on current composition and allocation:
StashAway SRI 36% Portfolio
Similar to Syfe, StashAway portfolio also consists of many ETFs across a few asset classes, namely equity, real estate, commodity (gold specifically) and bond. Do take note that there is no KWEB in current composition as StashAway had re-optimized their portfolio to remove the exposure to China equities in March 2022 (refer to Robo War Experiment (RWE) Update – March 2022).
Here is the current cost structure:
SquirrelSave Very Aggressive Portfolio
Finally, SquirrelSave portfolio also consists of many ETFs, similar composition (equity, real estate, commodity and bond), but different allocation. They are pretty heavy on QQQ and SPY, taking up almost 75% in US equities.
SquirrelSave has an additional fee known as the performance fee in their cost structure, which is calculated based on 10% of positive return above the High Water Mark. In order to estimate the performance fee, I referred to SquirrelSave blog post “How SquirrelSave AI Risk-Managed Portfolios Performed Over Time” published on 1 April 2022, in which they show 12 actual client Very Aggressive portfolios. I calculate the average return of the 12 portfolios was 9.83% p.a., 10% of which means 0.98% performance fee based on capital, and 0.90% based on portfolio value (i.e. 109.83% of capital).
Detailed cost structure as show below:
Key Observations
All ETF-based portfolios have lower fund level fees.
MoneyOwl Dimensional-based portfolio has comparable fund level fees as ETF-based.
Endowus mostly-Dimensional-based portfolio has slightly higher fund level fees after netting off trailer fees rebates.
Endowus and MoneyOwl are the lowest in terms of robo advisor fees, with Syfe following closely behind.
SquirrelSave robo advisor fees is the highest due to the additional performance fees.
In terms of total fees, the cost winners are MoneyOwl and Syfe, followed by Endowus.
Cost is just one aspect of evaluating the robo advisor portfolio. What is more important would be the investment strategy, and the net return it can achieve subject to the risk incurred.
By now, everyone in the crypto circle would have probably known about the UST Stablecoin Depeg Saga and the chaos it has caused to Terra LUNA and the crypto market at large. CoinDesk published an explainer article on the saga: The LUNA and UST Crash Explained in 5 Charts
The Terraform Labs said in a tweet that they have decided to halt the Terra blockchain to prevent governance attacks following severe Luna inflation and a significantly reduced cost of attack. They resumed activity less than 2 hours later after applying code patches to the blockchain. Unstablecoin: Terra halted its blockchain as UST tumbles toward $0
Tokenize Exchange Responses
This morning (13 May 2022 11am SGT), Tokenize Exchange sent a Special Notice on the suspension of Luna withdrawal:
This evening (13 May 2022 7pm SGT), Tokenize Exchange sent an update on LUNA and UST, announcing the withdrawal of deposits under Crypto Earn with pro-rated earned yield:
An update from Tokenize Exchange on 20 May 2022 7pm SGT:
Performance Update
Here is a snapshot of the 4 coins in my portfolio as of this morning:
LUNA closed below USD0.01 yesterday, that is more than -99% drop from its All Time High (ATH) of USD119.44. The other 3 coins suffered varying degrees of price drops.
I have updated my crypto portfolio performance based on yesterday closing prices from Tokenize Exchange, which quoted LUNA price at $0:
My LUNA holdings still shows positive returns because I had taken partial profits in December 2021 (refer to Crypto Investment Update – December 2021) and recouped my capital invested in LUNA. With its price quoted at $0, my holdings in LUNA is now 0% allocation to my overall investment portfolio.
The allocation to my cash balance in Tokenize Exchange has also dropped to almost 0% because I actually bought some LUNA coins yesterday. This is purely a speculative move without any real justification as there is no telling whether LUNA can survive this saga. It is a bet on LUNA either go bust or recover some, and I am not too concern because the bet was small dollar amount.
My crypto portfolio is now 3.22% allocation of my overall investment portfolio, almost half from the end April allocation of 6.01%. The portfolio returns has now gone into negative territory.
Lessons Learnt
It is a good thing that I have adopted a portfolio investment mindset in the beginning (refer to My Speculative Crypto Investment Journey), treating crypto as the aggressive end of the barbell strategy, keeping my investment within 5% of my overall investment portfolio allocation and diversifying risk into multiple coins. This allows me the tenacity to withstand this onslaught of potential crypto meltdown.
On hindsight, I could have taken more profits from LUNA and withdrew all the capital I pumped into this crypto portfolio, leaving the remaining portfolio completely risk-free.
I was doing monthly review on my crypto portfolio. I could have taken action, perhaps exiting half of my crypto holdings, when there were signs of bearishness (e.g. break down from Ichimoku Cloud).
Disclaimer: This post is just for educational sharing purposes. Please do your own due diligence on any products mentioned in this post.
New Additions to Robo War Experiment
I have added MoneyOwl Equity100 (Dimensional Equity) and SquirrelSave Very Aggressive Portfolio (90% Equity / 10% Fixed Income) on 1st April 2022 to the experiment.
MoneyOwl Equity100 Portfolio is based on Dimensional Global Core Equity Fund (88%) and Dimensional Emerging Markets Large Cap Core Equity Fund (12%): https://www.moneyowl.com.sg/moneyowl-dimensional/
SquirrelSave offers 5 reference portfolios of various equity / fixed income mix, I have specifically selected the most aggressive 90% / 10% mix to be on par with the other robo advisors’ portfolios for comparison.
While they didn’t name the competitors, it is quite clear that the 3 competitors in the table are StashAway, Syfe and Endowus, in that sequence respectively. In fact, Competitor1.5, Competitor2.4 and Competitor3.5 portfolios in the table are the same 3 original portfolios in my Robo War Experiment (StashAway SRI36%, Syfe Equity100 and Endowus Equity100 respectively).
It would be interesting to compare my performance comparison against theirs. However, SquirrelSave had removed the monthly performance numbers from their comparison table for April 2022, which was included in their previous monthly updates. Not sure if they have removed those numbers because their April performance was the worst out of the 5 robo advisors’ portfolios.
Performance Update
Here is the April 2022 Performance Update:
April 2022 saw a blood bath in the market (SquirrelSave called it brutal in their blog post), worse than that of January and February 2022. MoneyOwl and SquirrelSave are the 2 new entrants to the experiment and unfortunately they joined at a really bad timing.
Key Observations
All 5 robo advisors suffered losses in April 2022, StashAway the least, and SquirrelSave the worst.
Except for SquirrelSave, the other 4 robo advisors suffered less losses than the 3 benchmark indices.
As MoneyOwl and SquirrelSave only joined the experiment for a month, their annualized losses were amplified as seen in their XIRR.
Disclaimer: This post is just for educational sharing purposes. Please do your own due diligence on any products mentioned in this post.
Performance Update
The crypto market turned bearish in April:
All 4 cryptocurrencies turned down and broke below Ichimoku Cloud, and they all showed Bearish Twists at the far right hand side, not a good sign for the coming months.
Here is the performance update as of end April 2022:
Due to bearish turn in April, the portfolio allocation dropped to 6% and SOL went deeper in red.
Personal Wealth Life Cycle Management (PWLCM) 