I login SPDR Straits Times Index ETF (ES3) website to see their financial ratio and there is one ratio I am confused, which is the Price/Book Ratio.
Currently the price to book ratio is 1.22. I am wondering whether the denominator Book value is
i) the book value of ES3 itself(which is the weighted average share price of the underlying stocks - all liability of ES3)
ii) the book value from all the underlying stock themselves(Their Asset - their respective liabilities)?
Thanks for your advice in advance.
It'll be the book value of the underlying stocks. The price-to-book of ES3 itself is always going to be right around 1.00, because the ETF creation-redemption mechanism keeps the price of ETFs in line with their value.
Also, I thought the first 3 months should be commission free? I was charged commission and the account was open in December 2016 and approved in January 2017.
It's a maintenance fee waiver, not a commission waiver; you'll still pay brokerage on your trades.
Is there a place in IB that I can view the simple statements? I am using the monthly view in the activity statements now but it is still confusing for me. I think I need more time to get used to IB. >.<
Thank you all! Have a great day ahead!
Yeah, IB is a little unfriendly sometimes. I think the activity statements are reasonably good, though.
Is there a hardcopy version of the ST's book?
Don't mind paying for~
Nah, I looked at doing this but I can't find any publishers that aren't vanity presses. If anyone's got contacts in the publishing industry (outside of Epigram; I pitched to them but it never got out of the slush pile), ping me a private message.
Hi Shiny Things,
I have really been a fan of you and am very thankful that you are willing to share so much valuable information
I would like to ask a rather dumb question, please pardon me im a newbie
So im currently serving NS and have decided to dedicate $400 each month into buying G3B.SI stocks through DBS. However since SCB has a lower fee of 0.2% compared to DBS which is 1%, Im considering to switch over to SCB. However, im wondering if it is possible to transfer my holdings of G3B from DBS to SCB.
Sorry for the newbie question
You're still going to end up paying more at Stanchart, I think - last I checked Stanchart's got a $10 minimum per transaction.
Its rebalancing mth!
Just 2 qns:
1. Correct me if I am wrong, I should convert iwda(usd) into sgd for the rebalancing(110-age) calculation and not ES3(SGD) into usd since based currency is Sg?
2. After selling some and buying some to get to the ideal 110-age ratio, do I start DCA again this month immediately after rebalancing or I should start DCA next mth instead and leave this May purely for rebalancing only?
1) Yep!
2) Yep! You want to invest regularly every month.
hello all, I’m new to investing and would like to seek your advice! have read this thread a bit and it’s really great… thanks Shiny Things and everyone else
De nada!
1. since I can’t open an account with standard chartered (below min age), where would you suggest I open a trading account? have looked into OCBC and DBS young investors. while OCBC seems to have an overall stronger… program(?), the min commission for DBS for the LSE is significantly lower (USD 36 vs USD 95 for OCBC etc.)
OH MY GOODNESS. Don't pay either of those. That's extortion. Honestly, I'd wait until you turn 21 and then open a Stanchart account.
2. I don’t have much in my bank account currently (around $4000), and perhaps can only contribute $100 to investing a month due to certain uncontrolled expenses and uncertainty I'm facing. ignoring safety cash, should I just dump most/all of my savings into investing at one go, since I’ll be looking at a fairly long investment time horizon, or should I still try DCA? would the min commission and all that make DCA not worth it?
or maybe I should invest quarterly...?
appreciate your responses!
Start with just the POSB Invest Saver. You can put $100/month into it, switch it on and off at will, and get yourself used to regularly investing; then once you can scale up you can add a Stanchart account as well.
Hi all!
Another newb here just after reading Shiny Thing's book.
I'm planning to take up the advice on investing in STI ETF on a regular basis (~$1500 / mth).
But the problem is that I find it hard to start when it seems that the price for ES3 is at its peak.
Should I just push ahead and buy? or should I wait?
How bout a dynamic portfolio allocation? If you feel ES3 has peaked, start by allocating your age + 10 into your Bond allcoation (eg if you are 30 then 30+10=40% into bond and 60% into ES3)
When ES3 falls, you start to steer your portfolio allocation to age -10 (eg if you are 30 then 30-10=20% into bond and 80% into ES3)
Mmm - I don't think this is a great idea. What if you're wrong and ES3 keeps on truckin'?
This is the sort of thinking that got people into trouble in 2009-11; everyone was scared of another crash, so they stayed underweight equities and overweight cash. By 2013 people had realised that they were wrong and missed the boat, so stocks rocketed 30% in a year.
I think it's better to keep a neutral allocation and don't try to pick the market.
Also, as people have said upthread, this is the point of dollar-cost-averaging. If the market goes down: great, you get to buy more shares per month at a lower price, so a dip in the market is a good thing! (I was pretty stoked by the SPX's 2% spew yesterday - my mid-month purchase in my 401(k) usually goes through about now, so I'm getting 2% more shares from my usual biweekly paycheck.)
Also: ES3's not at its peak! It's been higher as recently as 2015, before the big emerging-markets selloff.
Not sure if I missed something, any reason why rebalancing in May specifically?
Good question! It was kind of a convoluted process. My thought process was:
1) OK, the best time of year to rebalance is November. November is typically the beginning of the seasonal strength in equities, and it means you avoid the crappy illiquid markets that dominate December, when every trader has hit their budget for the year and given up.
2) It's slightly better to rebalance twice a year than once a year - anything more than that is overkill.
3) So... it makes sense to have the second rebalancing six months from the first rebalancing. That means May.
I'll do these next two together:
As I understand, POSB InvestSaver is not very economical if you are going to spend >$1000 buying ETFs and I should use Standard Chartered if it were to happen. But what if one day I have enough money to start investing >$1000 in ETF every month, what do I do with the ETF in my POSB InvestSaver? Do I sell them (in POSB) and use the money to buy more ETF (in Standard Chartered) or can I transfer them to Standard Chartered?
Thanks for any tips in advance =)
Hi shiny things,I have recently read up your e-book and is also a complete newbie in investing.I have a question which is,when I switch over from POSB invest to StanChart,how do I "move" the bond ETFs from POSB invest?
Also same question regarding moving IWDA stocks from StanChart to IB account.Does "moving" the stocks literally means transferring stocks from StanChart to IB,or selling the IWDA stocks in StanChart account and begin purchasing the IWDA stocks in the IB account?
1) I know you can sell your POSB Invest Saver holdings for cash, transfer the cash over to Stanchart, and then re-buy them at Stanchart; I don't know if you can just transfer the shares over.
2) You can do either - my preference would be to transfer the stocks.
Hello there, I've got a question on purchasing securities using the stand chart online trading account. It seems that you have to manually enter the quantity and price of the equity you are looking to purchase. Should you be entering the bid price or the ask price or some other value for that matter?
Great question!
I put a note on this in the book. When you put in an order on Stanchart, you're saying "I want to buy this number of shares at no more than this price" - so if you want to guarantee that you'll get filled immediately, the easy thing to do is to enter a price a few cents
above the ask price.
That way, your buy order will get matched immediately with the best sell order sitting on the exchange's order book, and you'll get filled at the price of the best sell order, which will be cheaper than the price you said you'd pay.
There's a lot of nuance here, and big investors spend millions of dollars building algorithms and smart order routers to optimise the work-a-bid-or-get-me-done decision. For regular investors, because our amounts are small and our time horizon is years (and because we're talking about very liquid ETFs), we can afford to just say "eh whatever, I'll pay the offer".
Also, when would be a good time in the day to purchase? When the markets just open, about to close or sometime in between?
You don't need to think about this
too much.
Markets are most liquid near the close, especially in the case of IWDA (it's most liquid when US markets are open, which is toward the close of UK time). But come on, staying up until like midnight Singapore time just to put your IWDA order in is silly. So, doing it at the open is fine too.
As we know, IB has the most cost effective commission fees for people buying IWDA, but they also charge maintenance fees for accounts worth lesser than $100,000
From what I've read, someone who wants to get started with IWDA, only has the two following options:
1) Save up till $100,000 and fund the IB account with a lump sum, then slowly DCA the IB account balance into IWDA
2) Start accumulating IWDA using Singapore brokerages. Once your portfolio reaches $100,000, pay a fee to transfer custodian from your brokerage to IB
3) Start accumulating IWDA using IB, and incur the maintenance fee until your portfolio finally reaches $100,000
So as people have pointed out, #1 is really not an option; you'll have a huge lump of cash sitting in the bank. My preference would be #2, unless you're investing more than about $1000 a month; once you get above that line, it's cheaper to pay the monthly fees to IB so you can take advantage of their tighter FX spreads.
Chance upon this thread real late, heading toward 30 and hope it is not too late to deploy my ammo targeting early retirement (say mid 50s-60)
Heading toward 30? Don't worry, that's a great time to start - I didn't really start investing until I was 26, and even then it was extremely tentative.
