My reason behind doing a 66%/33% split between the 2 funds is because I am able to take a higher risk in return for the potential higher returns.
The assumption there is that global shares will continue to outperform Singaporean shares over the next 30 years, which... I don’t think is necessarily true. If we see a relaxation of capital rules on banks, then the Singaporean market (which is heavy on financials) should outperform.
Specifically for IBKR, I just created an account and am looking to start buying into IWDA soon. So all I have to do is transfer SGD into the account, use the IBKR's rate to convert into USD & buy into IWDA? Am I able to set a SI with my bank to deposit a fixed amount of cash every month into IBKR?
1) yes.
2) yes, but you’ll also need to create a recurring instruction on the IBKR side so they know to expect the standing-instruction payment from your bank.
Also, will the balance in the account (after purchase) earn any interest? I also noted a scheme by IBRK where the platform can "lend" other investors my shares. Is this something advisable to push for a higher earnings?
1) Yes, as per IBKR’s “interest and commissions” web page.
2) So yes, this is a thing (it’s called the “stock yield enhancement program”), but it only applies to shares that are listed in the US and Canada, so it won’t matter to you.
Let's say banks are dishing out cheap loans right now to me, what would you recommend to do? What type of bank products would be best to capture the benefit of cheap loan with a decent timeline?
None of the above, dude. Investing using borrowed money is not a good idea. (Especially now: the yield curve is so flat that the traditional “borrow short-term invest long-term” trade has atrocious risk-reward.)
1. What recommended ETFs for investment purely into China shares that is low cost ?
2. What about cheapest ETF for HK stock market ?
Thanks
1) So I’m going to ask you the same thing I ask everyone else who comes in saying “which ETF should I buy if I want ‘China’?”:
Q1: Which “China”? Greater China or mainland China?
Q2: If your answer to Q1 was “mainland China”: A-shares or H-shares? (And if the A-shares, why do you want the thing that costs 10-15% more for exactly the same thing?)
2) I think the default is 2800.HK. There might be some things that are a bip or two cheaper, but 2800 is where the liquidity is.
If I want to build up my IB portfolio as fast as possible to hit the 100k mark, is there a bond ETF that you'll recommend to buy on IB, alongside IWDA / VWRA?
Not really, no. Your portfolio’s not going to grow any faster if you buy two ETFs instead of one, and for most investors I don’t think it’s worth it to take the extra currency risk that comes with overseas bond exposure.
1. POSB IS is really the best alternative ? The fee is 0.82% which is really high right?? The recommended fee was only around 0.3%.
For small investors, yeah, POSB IS is best because it doesn’t have a minimum brokerage fee. For example: OCBC BCIP has a five-buck minimum—which, if you’re investing $200 a month, for example, is 2.5%. That’s a lot.
2. I am rather young and can afford more risk. What other ETFs should I look into after buying IWDA and MBH???
Don’t forget ES3. But anyway, no: a heavy equities tilt (a nice mix of IWDA and ES3) is plenty of risk exposure for a younger person.
Say i have a view that there is likely have a recession in the next 12 months (ie into 2020) and want to deploy a lump sum over a period of time. My plan is to spread over 12 months (ie till Sep 2020). Is this period too long but i don't want to buy in too aggressively with the economic outlook not looking too great.
It’s longer than I’d recommend (I’d usually spread it over 4-6 months) but it’s pretty sensible. As for whether you should accelerate your buying if the market dips... ehh, I dunno. I think it’s better to stick to a schedule, but buying more on a dip is OK.
Can I ask a quick question?
Is this something one can buy independently or you have to go through the bank?
I’m going to reject the premise of your question: why do you want to buy that thing in the first place?
For accumulating ETFs like IWDA and VWRA, the common advice is it's better than the distributing counterparts as it auto reinvests the dividends. Are we assured the full amount will be reinvested? As in it is equal to if we reinvest the dividends from vwrd ourselves? Is there any checks and balances for the process?
...are you asking whether the fund manager is stealing from you? Really?
Anyway, yes, it’s equal to if you reinvested the dividends yourself (if anything it’s cheaper, because having the fund manager reinvest the dividends gives you economies of scale on the transaction costs).
Hello everyone, have been investing based on ST's advice since sep 2015! 4th year soon!
_thumbs-up emoji!_
1) Is it fine if I stick to SCB and not switch to IBKR. I do not have $100k worth of IWDA. Should we only use IBKR if we have $100k worth of shares in IBKR?
Mmm - sure, it’s always fine, but you’ll find your executions and your FX costs are cheaper if you move to IBKR. If you’re doing over $1k a month or so, then it’s definitely cheaper to use Interactive even if you don’t hit the $100k mark.
2) I see that A35 is not actively mentioned but instead changed to ... MBH? Is it fine for me to stick to A35?
Yeah, I changed my preferred ETF for the “local bonds” component to MBH last year. A35 is fine if you already own some, but MBH (which owns corporate bonds instead of government and GLC bonds) gives you a higher yield that more than adequately compensates for the extra volatility.
Is it still a working method to dca given Trump siao lang tweets?
Dollar-cost-averaging works even better when Donny Two Scoops is making the markets more volatile. The point is that by buying a constant dollar amount, you “automatically” buy more shares when they’re cheap (after he tweets) and less shares when they’re expensive (when someone takes away his iPhone).
If one is not able to DCA into IWDA (for whatever reason), what do you think of DCA into Infinity Global Stock Index Fund SGD Class unit trust instead? The ETF and unit trust (via its parent Vanguard® Global Stock Index Fund) track MSCI World Index.
No. God no. Those Infinity Global funds are horrifically expensive - they charge nearly a full percentage point for the privilege of wrapping the Vanguard funds, last I checked. That’s a goddamn ripoff.
