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Shiny Things

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I do believe I can stick to whatever allocation I eventually decide upon. In fact, I don't think I've sold anything in the past decade. The inertia is strong in me.

That's the spirit!

On the tax questions you raised: I genuinely have no idea how the tax treatment's going to work for non-Aussie holders of the Aussie ETFs, or non-Canadian holders of the Canadian ETFs. I think you're really going to have to suck it and see - just buy them and see how much you get withheld. The one thing I'd do is make sure you use Interactive to buy them; any other shop is going to absolutely run you over on the FX spread.
 

Shiny Things

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Hi Shiny! as requested, here are the posts again.
I do have a few questions though. My apologies if any of these have been answered, but I still have about 200+ pages to go
- Is there another alternative to the Maxigain account that I can look at? Right now, that seems like the best place to put my emergency fund and short-term savings due to the interest rate
- As I am looking to relocate to and retire in Europe, do I still stick with ES3/IWDA/A35? Should I be looking at something other than ES3 and A35? Or just stick with these two in case things don't work out? Or even use ES3 and A35 first and then later sell them once I relocate and replace them with their local equivalent?

Oooohhh, good question.

Europe's a bit of a special case, because their bond market is just bananas—you don't want to be buying, like, 5yr KfW EUR bonds that yield -0.19%. You'd literally rather shove a pile of 500-euro bills in a safe deposit box in Frankfurt or something. (Markets talk: if anything I reckon you want to be paying EUR rates right now, not receiving.)

Anyway. You're right that you don't want to stick to ES3/A35 if you're not planning to retire in Singapore. If I were in your shoes I'd probably go full global—if you're not set on where you want to retire yet, or if it's "maybe Singapore, maybe not", then you don't really need a "local stocks vs global stocks" allocation. You could do a lot worse than just a two-fund portfolio made out of IWDA and CORP (a global investment-grade corporate-bond ETF).
 

revhappy

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Shiny, can you please help me understand this. In stock markets for every buyer there is a seller. Then why do people say people are "buying" heavily or people are "selling". In aggregate, shares are just changing hands, so what does it mean when they say, "cash is at record levels" or people are fully invested or leveraged? If we exclude IPOs and share buy backs, then the total number of shares is same and when one person is deploying cash another person is cashing out. Then how can it be a case of "cash levels are high

When markets are going up people are paying more and more to buy those same shares, but then someone is also getting paid more and more to sell those same shares isnt it? As people earn and save money obviously there will be more money chasing stocks and then they will pay someone to buy their stocks and that someone now has more money. So this seems to be an infinite loop as long as there is cash generation in the system.

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Rhaegar

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Oooohhh, good question.

Europe's a bit of a special case, because their bond market is just bananas—you don't want to be buying, like, 5yr KfW EUR bonds that yield -0.19%. You'd literally rather shove a pile of 500-euro bills in a safe deposit box in Frankfurt or something. (Markets talk: if anything I reckon you want to be paying EUR rates right now, not receiving.)

Anyway. You're right that you don't want to stick to ES3/A35 if you're not planning to retire in Singapore. If I were in your shoes I'd probably go full global—if you're not set on where you want to retire yet, or if it's "maybe Singapore, maybe not", then you don't really need a "local stocks vs global stocks" allocation. You could do a lot worse than just a two-fund portfolio made out of IWDA and CORP (a global investment-grade corporate-bond ETF).

Thanks, Shiny! I'll do a 78-22 split on IWDA/CORP then. I'm guessing I can then diversify into local stocks and bonds once I've finally settled somewhere?

Another question, this time IBKR-related. Can I deposit US$10,000 to open the account, buy US$750 worth of IWDA (as that's approx S$1,000, which is my current monthly allocation for investing), and then withdraw USS$7,250, leaving behind the minimum US$2,000? Or do I need to use up all US$10,000 that's in the account?

The reason for doing so is that I can "borrow" the amount for the account opening from my emergency funds. If I can't, I suppose I'll hold off on buying anything first until I've saved up the minimum deposit. Or should I just stick with Standard Chartered as it's much more straightforward? Just trying to see what the best long-term option would be with regard to SC's higher FX spread vs IBKR's monthly activity fee.
 

revhappy

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Thanks, Shiny! I'll do a 78-22 split on IWDA/CORP then. I'm guessing I can then diversify into local stocks and bonds once I've finally settled somewhere?

Another question, this time IBKR-related. Can I deposit US$10,000 to open the account, buy US$750 worth of IWDA (as that's approx S$1,000, which is my current monthly allocation for investing), and then withdraw USS$7,250, leaving behind the minimum US$2,000? Or do I need to use up all US$10,000 that's in the account?

The reason for doing so is that I can "borrow" the amount for the account opening from my emergency funds. If I can't, I suppose I'll hold off on buying anything first until I've saved up the minimum deposit. Or should I just stick with Standard Chartered as it's much more straightforward? Just trying to see what the best long-term option would be with regard to SC's higher FX spread vs IBKR's monthly activity fee.
IBKR is the way to go if you are doing atleast 1 transaction in a month of S$ 1k. The savings on FX and on the minimum commission more than make up the $10 monthly fee. You can do anything with the $10k deposit. You can leave it as it is or even invest it fully. You can also convert your account to a margin account, in which case even if you deposit money worth 10k and buy stocks worth 10k, you don't really use up the entire 10k. I think only about 1/4th of the money is required as margin. This allows you to withdraw in case of emergency.

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wealth_farmer

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I was able to activate my IBKR account with initial deposit of SGD 6k. I wouldn't recommend you fund to the proper minimum amount because you may find you are not able to withdraw what you deem as excess cash subsequent to your ETF purchase. In my case, with my SGD 6k, I found I was not able to initiate a withdrawal, presumably because I don't meet the minimum USD10k sum. Be careful though because there's a threshold amount below which you will be charged more than the usual USD 10 monthly minimum activity fee but I can't remember what that threshold amount is.

If you're committed to doing two USD-denominated ETF purchase every month, then IBKR makes more sense because with SCB, you'll incur two times the USD 10 brokerage, unless you're an SCB Priority Banking customer, then you can go with SCB.

Also, if your monthly investment amount is $1000, perhaps you could consider aggregating your sum and invest in each ETF alternately each month to lower your brokerage expense? Investing USD 220 per month into CORP is quite a small amount, for example. Maybe IWDA one month, and CORP the next? In that case, SCB could be better but IBKR is still fine if you can commit to one purchase every month.

I don't think you should open a margin account at this point in time.

Another question, this time IBKR-related. Can I deposit US$10,000 to open the account, buy US$750 worth of IWDA (as that's approx S$1,000, which is my current monthly allocation for investing), and then withdraw USS$7,250, leaving behind the minimum US$2,000? Or do I need to use up all US$10,000 that's in the account?
 
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proton91

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Hi guys,

In ST's book, he recommends using IB to buy the IWDA component of our portfolio.

Did a quick research on IB and realised that they require a min sum of 10K USD, if not activity fee will be charge monthly.

In this case, what are the alternatives given that I do not have 10K of liquid cash to be parked there?

Thanks!
 

revhappy

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Hi guys,

In ST's book, he recommends using IB to buy the IWDA component of our portfolio.

Did a quick research on IB and realised that they require a min sum of 10K USD, if not activity fee will be charge monthly.

In this case, what are the alternatives given that I do not have 10K of liquid cash to be parked there?

Thanks!
Actually there are different tiers of minimum fees. I believe for AUM of 0 to 2k, you will be charged $20 per month and $2k to $100k you will be charged $10 per month. There is no way avoiding fees. You pay them one way or the other, whichever platform you use.

Sent from Xiaomi REDMI NOTE 4 using GAGT
 
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limster

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Hi guys,

In ST's book, he recommends using IB to buy the IWDA component of our portfolio.

Did a quick research on IB and realised that they require a min sum of 10K USD, if not activity fee will be charge monthly.

In this case, what are the alternatives given that I do not have 10K of liquid cash to be parked there?

Thanks!

if you don't have 10k, just buy STI ETF and A35 first, you can always way till you get 10k before you buy IWDA.
 

proton91

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Actually there are different tiers of minimum fees. I believe for AUM of 0 to 2k, you will be charged $20 per month and $2k to $100k you will be charged $10 per month. There is no way avoiding fees. You pay them one way or the other, whichever platform you use.

Sent from Xiaomi REDMI NOTE 4 using GAGT

Thanks for your reply. Got it, I guess this 10 USD is unavoidable unless I have more than 100K with them.

If I refer to this link, it says the minimum sum to open an account is $10k USD.

For all IB users currently, does that mean I must always maintain a minimum $10K USD in the account? So after buying my monthly worth of IWDA stocks, I will have to top-up every time to meet the 10k? Or is this simply a lump sum required to open the account?

Also, it states on the website that if Average Equity Balance is less than USD 2,000, the commission will be $USD 20 instead. What do they mean by average equity balance? Is that cash that is sitting in the account? Or it includes as well the total value of stocks that I hold with them?

Sorry for the lengthy question - am rather new to this so want to get the context right.

Thanks all!
 

revhappy

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Thanks for your reply. Got it, I guess this 10 USD is unavoidable unless I have more than 100K with them.

If I refer to this link, it says the minimum sum to open an account is $10k USD.

For all IB users currently, does that mean I must always maintain a minimum $10K USD in the account? So after buying my monthly worth of IWDA stocks, I will have to top-up every time to meet the 10k? Or is this simply a lump sum required to open the account?

Also, it states on the website that if Average Equity Balance is less than USD 2,000, the commission will be $USD 20 instead. What do they mean by average equity balance? Is that cash that is sitting in the account? Or it includes as well the total value of stocks that I hold with them?

Sorry for the lengthy question - am rather new to this so want to get the context right.

Thanks all!

The minimum initial deposit to open the account is 10K USD, although people here have reported that they were able to open an account with 6K USD too, but since it is officially not mentioned, you shouldnt bet on it.. I believe, once you open the account there is no need to maintain 10K, but I believe you will not be able to withdraw if you dont have 10K in your account.

The Average equity balance, means I believe daily average balance over a month, of all assets in your account(not necessarily equity as in shares) must be 2k. This can happen if you initially invest 10K, but later withdraw 8K or makes losses of 8k, then you will need to generate monthly commission of $20 or pay monthly fee of $20 minus the difference.
 
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proton91

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The minimum initial deposit to open the account is 10K USD, although people here have reported that they were able to open an account with 6K USD too, but since it is officially not mentioned, you shouldnt bet on it.. I believe, once you open the account there is no need to maintain 10K, but I believe you will not be able to withdraw if you dont have 10K in your account.

The Average equity balance, means I believe daily average balance over a month, of all assets in your account(not necessarily equity as in shares) must be 2k. This can happen if you initially invest 10K, but later withdraw 8K or makes losses of 8k, then you will need to generate monthly commission of $20 or pay monthly fee of $20 minus the difference.

Thanks for the detailed explanation! I am clear now
 

burger87

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Not sure if anyone encountered this. I bought the IWDA LSEETF in IB Trader Workstation, but the trades in my account management shows "SWDA", and I got charged USD5 for the comm instead of 0.005USD/share or min USD1, whichever is higher.

I understand that SWDA is traded in GBP so the min comm is USD5, but why is my trade under SWDA? Trader Workstation shows ticker as IWDA.
 

w4rdsg

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Yesterday night I sold my 600 IWDA that I had invested a week ago as I saw $400 profit and markets at all time high and too many factors that can create a fall anytime, gave me cold feet.

Ok, so now what...?
That fear of falling from all time highs has been with investors for the last two years.

I think we all have three choices:
Are you prepared to sell stocks and sit it out until the market falls to whatever arbitrary level you might feel comfortable at?
Can you sit watching graphs every night deciding whether to buy or sell based on the latest news?
Or can you ignore the media cycle, keep some cash for a rainy day, buy and hold a balanced portfolio, and as Mr Shiny so eloquently put it, go to the pub? :)
 

revhappy

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Not sure if anyone encountered this. I bought the IWDA LSEETF in IB Trader Workstation, but the trades in my account management shows "SWDA", and I got charged USD5 for the comm instead of 0.005USD/share or min USD1, whichever is higher.

I understand that SWDA is traded in GBP so the min comm is USD5, but why is my trade under SWDA? Trader Workstation shows ticker as IWDA.
IWDA trades on LSE but in USD currency and LSE trades for USD commission is $5 minimum or 0.005%. So it is correct. The report shows SWDA incorrectly, you can ignore it. GBP minimum commission is 6 GBP. So you are better off trading the IWDA which is in USD.

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Rhaegar

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IBKR is the way to go if you are doing atleast 1 transaction in a month of S$ 1k. The savings on FX and on the minimum commission more than make up the $10 monthly fee. You can do anything with the $10k deposit. You can leave it as it is or even invest it fully. You can also convert your account to a margin account, in which case even if you deposit money worth 10k and buy stocks worth 10k, you don't really use up the entire 10k. I think only about 1/4th of the money is required as margin. This allows you to withdraw in case of emergency.

Yeah, I've been looking up articles and reviews of IBKR vs Stanchart and it does seem that it's more worth it to go with IBKR in the long run. As for a margin account, I'm a bit iffy about using money that's not mine and I think I'll just open a normal account for now.

I was able to activate my IBKR account with initial deposit of SGD 6k. I wouldn't recommend you fund to the proper minimum amount because you may find you are not able to withdraw what you deem as excess cash subsequent to your ETF purchase. In my case, with my SGD 6k, I found I was not able to initiate a withdrawal, presumably because I don't meet the minimum USD10k sum. Be careful though because there's a threshold amount below which you will be charged more than the usual USD 10 monthly minimum activity fee but I can't remember what that threshold amount is.

If you're committed to doing two USD-denominated ETF purchase every month, then IBKR makes more sense because with SCB, you'll incur two times the USD 10 brokerage, unless you're an SCB Priority Banking customer, then you can go with SCB.

Also, if your monthly investment amount is $1000, perhaps you could consider aggregating your sum and invest in each ETF alternately each month to lower your brokerage expense? Investing USD 220 per month into CORP is quite a small amount, for example. Maybe IWDA one month, and CORP the next? In that case, SCB could be better but IBKR is still fine if you can commit to one purchase every month.

I don't think you should open a margin account at this point in time.

If I understand this correctly, it means that they didn't allow you to make any withdrawals since you didn't deposit the full $10k at first, but once you added the remaining $4k, you could start withdrawing? So as long as one makes that initial $10k deposit, there will be no more restrictions, meaning that I can withdraw $5k after opening the account, buying some shares and then ensure I have the minimum + buffer?

The Average equity balance, means I believe daily average balance over a month, of all assets in your account(not necessarily equity as in shares) must be 2k. This can happen if you initially invest 10K, but later withdraw 8K or makes losses of 8k, then you will need to generate monthly commission of $20 or pay monthly fee of $20 minus the difference.

So as long as the value of my shares stay above $2k, I don't need to have a minimum cash balance in the account? Or is the minimum cash balance of $2k required no matter how many shares you have?
 
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