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General
A Robo advisor is an online investment advisory platform which automates the investment advisory process with minimal human intervention. The whole process takes about 5 minutes.
Hemista is one of its kind Robo advisor, which takes into account the unique profile and needs of expatriates while designing an investment portfolio. The portfolio is allocated predominantly to assets with exposure to two countries viz the home country and the country of residence.
Hemista’s proprietary asset allocation model is tailored to the specific needs of Non-Residential Indians in the U.S. For example; generic Robo Advisors typically have an exposure of 2% to the Indian markets which we believe is not appropriate allocation for our target segment.
Hemista is a fee-only Investment Adviser, and we charge a percentage on the Assets under management. The fees will be charged quarterly and in advance. Hemista does not charge any transaction fees associated with using our advisory and portfolio management services.
$1000 to $ 50,000 50 bps (0.5%) per annum
$ 50,000 to $100,000 40 bps (0.4%) per annum
$ 100,000+ 30 bps (0.3%) per annum
Example calculation if the AUM at the beginning of a quarter is 20,000 you will be charged $ 25 dollars for that quarter.
Safety & Security
Yes. Hemista is a Registered Investment Adviser company with the U.S. Securities and Exchange, and it is regulated primarily under the Investment Advisors Act of 1940.
As a fiduciary, Hemista is required by law to collect certain information about the users as part of the KYC process. Hemista uses one of the best in class industry standards when it comes to protecting user information.
DriveWealth is the custodian and broker-dealer that Hemista uses to manage client accounts.. While opening an account with Hemista you also opens an account with DriveWealth and your funds are held at DriveWealth. DriveWealth is a member of FINRA/SIPC and securities in your account are insured to the extent of $ 500,000, which includes a $ 250,000 limit for cash. For more information visit https://drivewealth.com/
Hemista Inc. offers investment advice as a fiduciary and the assets are held under our custodian partner DriveWealth LLC. Your money is protected through DriveWealth’s membership in SIPC, insuring investors up to $500,000 which includes a $ 250,000 limit for cash.
No, Hemista does not guarantee anything related to the performance of the portfolio.
Investments
We follow a long term passive investing strategy with substantial exposure to the US and Indian equity markets. We use the core principles of modern portfolio theory to build the portfolio. Diversification plays a crucial role in our allocation, and we incorporate assets with low correlation to achieve superior risk-adjusted returns and refrain from diversification just for the sake of covering all possible asset classes. For instance, we do not see any meaningful value added when European equities are added to US equities since both these asset classes have a similar risk profile and are highly correlated. However, a combination of the US market assets and Indian market assets, which are less correlated, might yield superior risk-adjusted returns.
We don’t believe in frequent balancing, which we think cuts down on winners and adds into losers. However, we will review the portfolio annually for rebalancing, or in case the portfolio allocation to a particular asset class exceeds our threshold. Our threshold is higher than most other Robo advisors and thus reduces frequent churning of the portfolio. We take into consideration the user’s underlying currency exposure and adjust the allocation across the United States and India.
We believe, we as advisors are in a better position to assess the risk and recommend the ideal portfolio to our client and so do not give the client the option to tweak the portfolio. The whole purpose of using a Robo advisor is defeated if it involves frequent human intervention as one of the significant advantages of using a Robo advisor is that it eliminates all behavioral biases in the process of investing.
Hemista uses low-cost ETFs provided by some of the leading asset managers in the world, such as Vanguard, iShares BlackRock & SPDR State Street.
ETFs are low-cost funds which track an underlying Index. ETFs are a cost-effective way to gain exposure to a basket of equity or debt instruments for long term investors.
What portion of my wealth should I invest through Hemista?
Hemista is designed to be the only investment account that an NRI will ever need. Given the diversification and ease to handling a single account our clients can reap the maximum benefit by investing all their savings through Hemista.
Hemista is designed to be the only investment account that an NRI will ever need. Given the diversification and ease to handling a single account our clients can reap the maximum benefit by investing all their savings through Hemista.
Account Management
US citizens, Permanent Residents and anyone with a valid US visa such as (H1B,L1,F etc.) can open an account with us.
You can fund your account by linking your US bank account. You can also transfer your assets from a different brokerage account.
We only collect the information that is required to comply with the SEC and other applicable regulatory laws. We use the best industry standards to protect your information.
You can continue to hold your account with us and you will have to change your status to foreign individual with us. This may involve submitting some additional documentation for KYC purpose.
Yes, one can transfer their existing brokerage account to Hemista through a simple process called as ACATS.
No. At this point, we do not provide in person advice.
No. We do not provide tax planning services.
Your funds deposited via ACH would be eligible for withdrawal after a minimum of 30 days. This is a requirement from our custodian to ensure payments are authorized.
Your successful fund withdrawals should reflect in your bank account in 5 business days.
You can link your US bank account through our application and transfer money through an ACH transfer. The money will be reflected in your investment account within two business days.
Auto Invest
Auto Invest is a mechanism by which you can set up a fixed amount monthly to be automatically deposited into your investment account.
Auto Invest is a convenient way to invest a fixed amount monthly. We also recommend an amount to be set up for Auto Invest based on your profile.
Taxation
You will be filing taxes in the US just like any you would do for any other brokerage account. If you move to India, there will be withholding taxes in the US on your dividends alone. You will file taxes in India as part of your normal income. At no point will you be taxed twice as there is a tax treaty between India and the US.