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Old 04-11-2014, 09:28 PM   #31
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Support this thread. Shiny, my offer for a pint still stand whenever you are back in town
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Old 05-11-2014, 12:15 AM   #32
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ES3 currently stands at 3.33. If one wants to take the route of index investing, should he or she time the entry? Like buying when it is below X.XX amount etc. Or just purchase regardless of the price?
When to buy es3 and a35?
1 lump sum or monthly purchase ?
I'm gonna consolidate these two because they're basically asking the same question underneath.

If what you have is a stream of cash coming in monthly (say it's your chunk of your salary that you've dedicated to investment), then you should just invest that every month. That's called "dollar-cost averaging", and it's a good idea. You don't try to pick what time of the month is the cheapest - you just invest the same amount every month, regularly, and the times you buy high will be offset by the times you buy low.

If you have a lump sum to invest, then the best thing to do is to just dump it all in at once. There are a couple of provisos to that, though:
1) The market-maker in A35 usually isn't there for more than about $5,000. If you want to do more than that, you'll need to pay the offer; wait a few minutes for it to reload; and pay it again. (I really hate that I have to give this sort of advice to retail investors. A35 is the most boring ETF in the world, it's basically a bunch of SGS, it should be easy to make a market in it with a half-cent spread. Any enterprising coders out there at a brokerage with good HFT infrastructure feel like making a market in A35? You'll be doing a public service, and you'll see bucketloads of flow, I guarantee you.)
2) More importantly, you might be worried about buying high and having buyers' remorse. The easiest way around this is to split your lump sum into three parts, and invest one part each month until you're fully invested. That way, if the stock goes up, at least you've bought some; and if the stock goes down, you've still got ammo to buy some more at lower prices.

Shiny Things: you working in software company as programmer?

btw, how old are you now?
No, I'm a product manager - my coding skills are not sufficiently 1337, I can read code but not really write it. (Product management is actually a great next step for people looking to break from finance but still use their domain knowledge; you can use your user knowledge to shape the way the software develops, and if you have some basic technical skills you'll be able to communicate with the engineers on their terms as well as communicating with customers and sales staff on their terms.)

And I'm very early thirties.

Actually is the permanent portfolio better? Since it has gold, cash markets, stocks, and long term bonds? Since it catches the money everywhere it goes
So I don't actually like the permanent portfolio idea very much. It's done very well in the last 15 years or so, because gold and bonds have been on a tear; and I like that it requires yearly rebalancing as well. But it's got a few major problems with it:
1) Gold is an entirely unproductive asset, and I think big allocations of it (like the 25% that the permanent portfolio recommends) are going to be a huge drag on any portfolio. It doesn't throw off yield, and if it doesn't deliver capital gains then it's just sitting in your portfolio depreciating.
2) The portfolio as a whole is massively short interest rates. Gold, cash and long bonds are all direct or indirect bets on interest rates going down. In an environment of rising interest rates (like the one we're headed for in a few years), this portfolio is going to dramatically underperform.
3) A 50% allocation between bonds and cash is going to struggle to outperform inflation in the long run (especially if you're in Singapore, where real interest rates seem to be chronically negative). And don't say "but gold is an inflation hedge!" - over the long term, gold matches inflation, it doesn't outperform it. Stocks are a much better inflation hedge; over the very long term, gold returns 0% inflation-adjusted, but stocks return 5-7% inflation-adjusted.

I think a 60-40 stocks-bonds mix (or the old "110 minus your age") is a much better bet if you want to retire on that money. If you really must have some of the yellow stuff in your portfolio, 2-5% is fine, but don't expect it to do anything spectacular for your retirement returns; frankly I think it's going to print $600 before it prints $2000.

Ah... Any software firm that like to hire Singaporeans?
(Note: no degree in computational science)
Depends on the role. Product management, sales and presales, QA - none of these things need a comp sci degree. Heck, my bachelor's degree was in economics. (For that matter, if you don't mind hard work and you're comfortable with an entry-level-ish position, look for a QA role in a global firm - it is nightmarishly hard for firms to hire and retain QAs and testers, especially people with some domain knowledge.)

Any reason why this nick? *amused* just tot that ur nick is a warning to investors not to be lured by all things shiny... Heh heh
Nah, I just like shiny things.
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Old 05-11-2014, 01:05 AM   #33
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lol at first i thought this thread was for those who are fans of gold and silver, you know, 'shiny things'...
lol hhahaha. didnt even thought of that. anyway kudos to shiny things again for his input in this forum!!
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Old 05-11-2014, 01:13 AM   #34
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Shiny Things
1) Excellent skills at doing due dilligence
2) Good reasoning and sound investment process
With such a great and rare gem here. Its a loss to the any bank if you haven't been hired in a investment banking team already.
You are truly a asset Shiny Things!
#1 fan

Yukari
im his big fan too.
best FT in singapore
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Old 05-11-2014, 01:15 AM   #35
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And I'm very early thirties.

Depends on the role. Product management, sales and presales, QA - none of these things need a comp sci degree. Heck, my bachelor's degree was in economics. (For that matter, if you don't mind hard work and you're comfortable with an entry-level-ish position, look for a QA role in a global firm - it is nightmarishly hard for firms to hire and retain QAs and testers, especially people with some domain knowledge.)
wahahah are u single? LOL

and can elaborate more on the QA? how do i get a QA job in overseas? I love states too....
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Old 05-11-2014, 01:19 AM   #36
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wahahah are u single? LOL

and can elaborate more on the QA? how do i get a QA job in overseas? I love states too....
sweet yet handsome
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Old 05-11-2014, 04:09 AM   #37
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and can elaborate more on the QA? how do i get a QA job in overseas? I love states too....
So when I say QA, I'm talking about testing. And hiring testers is difficult - it's tough work; it's not glamorous; and you generally need to teach your testers about the logic behind the software you're building. Let's say your firm's product is a core-banking system: you need to teach your testers about the products that that banking system supports, about how accounting works, about how cashflows work; otherwise, they won't understand what the system does, and they'll just be robots running test cases, which i

If you have some banking or finance knowledge, and you have enough of a technical background that you wouldn't look confused if an engineer says to you "so just stick this JAR file in your classpath and run these SQL scripts", then you're a valuable asset to a financial software firm. You could come on to a testing team and already understand what the software does, and what these test cases you're running are actually supposed to test.

(The same goes for any other field of knowledge: a graphic designer testing graphics software; a biologist testing bioinformatics software; the key is to have that cross-domain knowledge of a little bit of your field and a little bit of software development.)

If you think you've got what it takes, then sniff around your network in your industry, or talk to your software vendors and see if they're hiring.
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Old 05-11-2014, 09:29 AM   #38
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Full support!

I'd vote you in for govnah of calif like how muricans vote Mitch Mcturtle to be Senate majority leader.

That didn't come out right. :<
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Old 05-11-2014, 11:47 AM   #39
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Hi Shiny

Need your view on this.

I'm actually want to do like investing in Vanguard. Is it possible for someone in SG to do that? Like every month put in xxx amount of money to buy it (dollar averaging).

I have come across this site while doing some research:
Why I Put My Last $100,000 into Betterment

It seem interesting - (Betterment) something new to me.
Just wondering what's your take on it?
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Old 05-11-2014, 11:56 AM   #40
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So I don't actually like the permanent portfolio idea very much. It's done very well in the last 15 years or so, because gold and bonds have been on a tear; and I like that it requires yearly rebalancing as well. But it's got a few major problems with it:
1) Gold is an entirely unproductive asset, and I think big allocations of it (like the 25% that the permanent portfolio recommends) are going to be a huge drag on any portfolio. It doesn't throw off yield, and if it doesn't deliver capital gains then it's just sitting in your portfolio depreciating.
2) The portfolio as a whole is massively short interest rates. Gold, cash and long bonds are all direct or indirect bets on interest rates going down. In an environment of rising interest rates (like the one we're headed for in a few years), this portfolio is going to dramatically underperform.
3) A 50% allocation between bonds and cash is going to struggle to outperform inflation in the long run (especially if you're in Singapore, where real interest rates seem to be chronically negative). And don't say "but gold is an inflation hedge!" - over the long term, gold matches inflation, it doesn't outperform it. Stocks are a much better inflation hedge; over the very long term, gold returns 0% inflation-adjusted, but stocks return 5-7% inflation-adjusted.
I think a 60-40 stocks-bonds mix (or the old "110 minus your age") is a much better bet if you want to retire on that money. If you really must have some of the yellow stuff in your portfolio, 2-5% is fine, but don't expect it to do anything spectacular for your retirement returns; frankly I think it's going to print $600 before it prints $2000.
Well… I gonna hijack this thread since I think gold is worthy of more a little bit more attention in a portfolio

1) True, gold is entirely unproductive, produces no yield, and I must also add that it has almost no practical industrial use as well. However, central banks, and individuals (investors) recognize the value of it, especially to counter inflation, depreciating currencies. It can also do well in the case of bank-runs, when there are strong doubts about the viability of the economy etc. Unlike stocks and bonds, I believe gold is perceived to be the ultimate “sh*t just got real I need to park my money there” vehicle

2) Not too sure how this works. I know bonds are directly affected by rising interest rate, but for the rest of the assets, I am not too sure how it works. For bonds, interest rate cannot always be rising, can it? Assuming that it rises to a certain level and generally move within a certain bracket, shouldn’t long term bond returns be at around 4-5% annual returns(US), even if we do not take into account an initial loss when interest rate is rising?

3) I think the main aim of gold in a portfolio is that it has low correlation with other asset classes. It can move spectacularly in the short term when there is inflation/deflation, which is why it is advocated that investors rebalance their portfolio when the gold holdings become too small/big. Not supposed to buy and hold and forget when you use the permanent portfolio. Rebalancing is key.

4) About the role of cash/short-term T-bills, I think it is very contentious. The volatility of cash/T-bills (original PP holdings) is very very low, its “official use” is to fight a deflationary environment, where the value of a single dollar grows with time. Having 25% in cash/short-term T-bills will inevitably reduce the volatility of your portfolio by a chunk, but as Shiny says, it will probably pull down the performance (even with the extra returns it can help generate through rebalancing). If you can allocate the 25% cash into a 3.05% pa OCBC 360 account then it becomes a totally different story.

Personally, I believe that the central idea of PP, which is to invest across assets with low correlation to each other, is sound. However, I do not favour the percentage of 25% across each asset classes. I choose to include overseas shareholdings (VWRD) and STI ETFs as the bulk of my portfolio, in the hope that I can get both the low (even though the correlation difference aint as great) correlation across asset classes, and still enjoy the higher returns of stocks.
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Old 05-11-2014, 12:08 PM   #41
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I'm gonna consolidate these two because they're basically asking the same question underneath.

If what you have is a stream of cash coming in monthly (say it's your chunk of your salary that you've dedicated to investment), then you should just invest that every month. That's called "dollar-cost averaging", and it's a good idea. You don't try to pick what time of the month is the cheapest - you just invest the same amount every month, regularly, and the times you buy high will be offset by the times you buy low.

If you have a lump sum to invest, then the best thing to do is to just dump it all in at once. There are a couple of provisos to that, though:
1) The market-maker in A35 usually isn't there for more than about $5,000. If you want to do more than that, you'll need to pay the offer; wait a few minutes for it to reload; and pay it again. (I really hate that I have to give this sort of advice to retail investors. A35 is the most boring ETF in the world, it's basically a bunch of SGS, it should be easy to make a market in it with a half-cent spread. Any enterprising coders out there at a brokerage with good HFT infrastructure feel like making a market in A35? You'll be doing a public service, and you'll see bucketloads of flow, I guarantee you.)
2) More importantly, you might be worried about buying high and having buyers' remorse. The easiest way around this is to split your lump sum into three parts, and invest one part each month until you're fully invested. That way, if the stock goes up, at least you've bought some; and if the stock goes down, you've still got ammo to buy some more at lower prices.



No, I'm a product manager - my coding skills are not sufficiently 1337, I can read code but not really write it. (Product management is actually a great next step for people looking to break from finance but still use their domain knowledge; you can use your user knowledge to shape the way the software develops, and if you have some basic technical skills you'll be able to communicate with the engineers on their terms as well as communicating with customers and sales staff on their terms.)

And I'm very early thirties.



So I don't actually like the permanent portfolio idea very much. It's done very well in the last 15 years or so, because gold and bonds have been on a tear; and I like that it requires yearly rebalancing as well. But it's got a few major problems with it:
1) Gold is an entirely unproductive asset, and I think big allocations of it (like the 25% that the permanent portfolio recommends) are going to be a huge drag on any portfolio. It doesn't throw off yield, and if it doesn't deliver capital gains then it's just sitting in your portfolio depreciating.
2) The portfolio as a whole is massively short interest rates. Gold, cash and long bonds are all direct or indirect bets on interest rates going down. In an environment of rising interest rates (like the one we're headed for in a few years), this portfolio is going to dramatically underperform.
3) A 50% allocation between bonds and cash is going to struggle to outperform inflation in the long run (especially if you're in Singapore, where real interest rates seem to be chronically negative). And don't say "but gold is an inflation hedge!" - over the long term, gold matches inflation, it doesn't outperform it. Stocks are a much better inflation hedge; over the very long term, gold returns 0% inflation-adjusted, but stocks return 5-7% inflation-adjusted.

I think a 60-40 stocks-bonds mix (or the old "110 minus your age") is a much better bet if you want to retire on that money. If you really must have some of the yellow stuff in your portfolio, 2-5% is fine, but don't expect it to do anything spectacular for your retirement returns; frankly I think it's going to print $600 before it prints $2000.



Depends on the role. Product management, sales and presales, QA - none of these things need a comp sci degree. Heck, my bachelor's degree was in economics. (For that matter, if you don't mind hard work and you're comfortable with an entry-level-ish position, look for a QA role in a global firm - it is nightmarishly hard for firms to hire and retain QAs and testers, especially people with some domain knowledge.)



Nah, I just like shiny things.
Interesting in-depth analysis, I think I agree with ur analysis overall.

Just a curious question though, is it possible for a person with no industry experience like working for a bank or financial company and no degree in finance to become a proprietary trader, but got experience in trading
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Old 05-11-2014, 02:03 PM   #42
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I'm actually want to do like investing in Vanguard. Is it possible for someone in SG to do that? Like every month put in xxx amount of money to buy it (dollar averaging).

It seem interesting - (Betterment) something new to me.
Just wondering what's your take on it?
The Vanguard funds are available through the Flying Spaghetti Monster (ahem, I mean FSM), but the 0.5% platform fee they charge is kind of unacceptable. You're better off just using the ETFs that are available in Singapore. You have to do the dollar-cost averaging yourself, but with a Stanchart brokerage account it's pretty easy.

And Betterment is seriously a brilliant development for small investors; ditto for Wealthfront and all the other robo-advisors that are springing up like daisies over here in the USA. They're basically an automated version of the "110 minus your age" rule, with a few nifty features and a slick interface on top. Some enterprising techie should launch one over there in Singapore.

Just a curious question though, is it possible for a person with no industry experience like working for a bank or financial company and no degree in finance to become a proprietary trader, but got experience in trading
Yeah, but it's very difficult. The days of coming straight out of high school and getting hired as a desk clerk are long gone.

Basically, if you have a few years' audited track record (no big losses, minimal drawdowns, decent profits), you can try shopping yourself around to proprietary trading groups. I don't know much about that side of the industry, but seowgao here on the forums might be the right person to talk to.
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Old 05-11-2014, 03:24 PM   #43
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really appreciate your advice in the forums.

just a curious question: i know u said u left your trading job to work at a software firm to broaden your horizon but is the remuneration comparable to your trading job? if not then i guess the change in lifestyle is worth the opportunity cost?

secondly from your experience, have you noticed that the market is constantly evolving, requiring new strategies to generate alpha (eg. rise of hft/ago traders etc) . if so, where do the traders get their inspiration from? their research team or they constantly figure something out in their free time? i know some large mutual funds have inhouse professors in research universities doing the work for them. eg. dimensional fund advisor etc. also, it is sometimes different when you have such a large position that you move the markets and the strategy is no longer profitable? im not sure about the fx options market but surely the equity market has seen drastic changes in the last 20years?

oh and lastly, do you mind sharing the % allocation in asset classes for your portfolio? i know u have a sizable chunk in passive equity/bond portfolio but surely you would have tried to generate greater returns through active management, coming from a trading background?

thanks
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Old 05-11-2014, 05:37 PM   #44
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Different model portfolios over a long period of time. notice the similarities and the differences.




MSCI World index with dividend reinvested over rolling 20, 15, 10 , 5 years period > MSCI World rolling returns over 20,15,10, 5 years net of dividends reinvested | Investment Moats - Stock Market Investing



Standard Chartered Online Trading removing the 0.5% stamp duty on specific ETF listed on London Stock Exchange. Here is a sample statement of a purchase of VWRD the Vanguard FTSE All World ETF > Standard Chartered Online Trading DID Removed 0.5% UK Stamp Duty From Certain Exchange Traded Fund (ETF) | Investment Moats - Stock Market Investing



Some information on Lion Global Inifnity Index Fund > The Global Stocks Index Fund in Singapore&ndash;Infinity Global Stock Index Fund | Investment Moats - Stock Market Investing
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Old 05-11-2014, 05:57 PM   #45
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The Vanguard funds are available through the Flying Spaghetti Monster (ahem, I mean FSM), but the 0.5% platform fee they charge is kind of unacceptable. You're better off just using the ETFs that are available in Singapore. You have to do the dollar-cost averaging yourself, but with a Stanchart brokerage account it's pretty easy.

And Betterment is seriously a brilliant development for small investors; ditto for Wealthfront and all the other robo-advisors that are springing up like daisies over here in the USA. They're basically an automated version of the "110 minus your age" rule, with a few nifty features and a slick interface on top. Some enterprising techie should launch one over there in Singapore.



Yeah, but it's very difficult. The days of coming straight out of high school and getting hired as a desk clerk are long gone.

Basically, if you have a few years' audited track record (no big losses, minimal drawdowns, decent profits), you can try shopping yourself around to proprietary trading groups. I don't know much about that side of the industry, but seowgao here on the forums might be the right person to talk to.
hmm, ok, so then its easier to just trade my own account then

what do u think of a strategy which is part investing part trading?

that is as u said the 60 stocks 40 bonds mix, the 60 stock allocated is further differentiated into 20% for covered calls and 80% for investments, so the 20% with covered calls are use as a way to bring basis down and then use the premium generated to further accumulate more stocks, sort of a self-directed drip program with premium replacing dividends, so that the portfolio is self-financing?
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