In April as I was learning the ropes on stock investing(i am still learning btw), I came across the shiny thing thread on the hardware zone forum. There are certainly many interesting tips which are spread out over the long-running thread, I saved quite a few of them as I found them to be very insightful. Here are some of them
Question 1: May I have some suggestion on how to start my investments? e.g invest in ETFs, bonds? and which platform should I do the investment? e.g through SGX directly, or through banks like POSB invest saver, DBS Vickers, OCBC blue-chip investment?
Answer 1: Start by investing into a mix of ETFs: local stocks(ES3, the STI ETF); local bonds(A35, the ABF Singapore Bond ETF); and global stocks (IWDA, which tracks the MSCI World index).You can do this through POSB Invest-Saver(for the Singapore ETFs) and stanchart(for the global ETF). Every other broker is worse, either they are more expensive, or they rip you off with unnecessary fees or both
One thing that’s worth mentioning though, you’ll always need to go through a bank or broker. The SGX is just an exchange, so it’s where people come to trade, the bank or broker I where you place your trades, and then they go off to the exchange and fill those orders for you.
Key takeaways 1: Use POSB Invest saver for the Singapore ETFs, and standard chartered for the global ETF, due to other brokers fees(I am using DBS Vickers though).In my defence, it is because my broker gives me a lot of useful reports and tips, hahaha, but I am starting to transit into using standard chartered due to the cheaper fee incurred when trading
Tip 2:The principle of buy and hold and rebalance still applies no matter where you live.
If you live in Singapore, you buy a mix of the STI ETF and the ABF bond fund, and rebalance once a year.
Don’t fall into the trap that since US stock have so well the last few years, you want to hop on that train, sell all my STI and get me into the S&P!. That’s is the exact opposite of what you want to do. Completely aside from all the currency risk,you’re taking on, you want to SELL the things that have outperformed, not buy them.
Key takeaway 2:Relance once a year but selling the stock that are outperforming.Don’t follow the trend too much and eager to hop onto the train quickly(yes, bitcoin I am looking at you)
Question 3: Which countries market would I be looking for?And which broker would be good for this?
Answer 3: The ETF can be listed anywhere, but generally what you are going to want is a nice, boring, simple global equity ETF. Around here, VWRD(listed on the London stock exchange) is the preferred pick
It’s worth looking at the UK’s ETF listings because those typically have better tax treatment than US ETF(less of your dividends get withheld)
Key takeaway: Choose VWRD as the global equity ETF as it has a better tax treatment than US ETF
Question 4:Are vanguard ETFs the only one worth looking at? And which of them would be suitable?
Answer 4:Stick to vanguard and I Shares. Ignore everything else,
Key takeaway 4:Vanguard or I Shares only for global ETF.