Current choices for investing in STI ETF

[galapogos]

OK I've finally gotten the online trading account. A few quick questions for people using the SCB online trading platform.

1. I have 2 new accounts open - a Securities Settlement Account, and a Securities Trading Account. What's the difference, and which account will fund my investments?
2. I'm playing around with the trading platform. I'm guessing "Place a trade" is where I buy/sell the Nikko AM Singapore STI ETF, with a code of G3B. Under "Order quantity", is the unit in number of shares, or lots, or something else? What's the minimum?

Thanks!

 

[Bedokian]

OK I've finally gotten the online trading account. A few quick questions for people using the SCB online trading platform.

1. I have 2 new accounts open - a Securities Settlement Account, and a Securities Trading Account. What's the difference, and which account will fund my investments?
2. I'm playing around with the trading platform. I'm guessing "Place a trade" is where I buy/sell the Nikko AM Singapore STI ETF, with a code of G3B. Under "Order quantity", is the unit in number of shares, or lots, or something else? What's the minimum?

Thanks!

1. The securities settlement account should be the one that you transfer your money from the esavers account for share purchase clearance. The securities trading account is just a number assigned to "name" the account.

2. Order quantity are by shares. For SGX shares, it is default 1000 shares unless otherwise stated. Rest assured that if you key in the wrong number, the system will prompt you a message. For the Nikko AM STI ETF, the quantity is 100 minimum.

 

[galapogos]

Thanks Bedokian!

Quite a noob in investing. I understand the concept of dollar averaging by investing an amount every month in the STI. However, I have quite a substantial amount of savings that isn't doing much otherwise, so I 'm wondering if it is prudent to pump in a larger initial amount into the STI to get more dividends, or should I just start with my desired monthly contribution and slowly build up.

 

[Shiny Things]

Thanks Bedokian!

Quite a noob in investing. I understand the concept of dollar averaging by investing an amount every month in the STI. However, I have quite a substantial amount of savings that isn't doing much otherwise, so I 'm wondering if it is prudent to pump in a larger initial amount into the STI to get more dividends, or should I just start with my desired monthly contribution and slowly build up.

Yeah, if you have an amount that you're specifically targeting for the stockmarket, it's OK to do a big slug of the STI upfront and then dribble the rest of the money in as it comes in.

And if you're worried about paying the high (which is natural!), you can split that initial lump into three or four parts, and put those into the market over your first three or four monthly investments. That way you can put the cash to work; if stocks drop, you can buy more cheaper; and if stocks go up, then at least you've bought some!

 

[Jajoba123]

And if you're worried about paying the high (which is natural!), you can split that initial lump into three or four parts, and put those into the market over your first three or four monthly investments. That way you can put the cash to work; if stocks drop, you can buy more cheaper; and if stocks go up, then at least you've bought some!

STI is high now, trading volume is low also. totally unexpected i thought will be quite stagnant. irony bcos i can had a diff view totally 5-6months back when is at 3000 level. so buy at the right time. i mean can;t say more when buying stocks.

 

[Mecisteus]

Quite a noob in investing. I understand the concept of dollar averaging by investing an amount every month in the STI. However, I have quite a substantial amount of savings that isn't doing much otherwise, so I 'm wondering if it is prudent to pump in a larger initial amount into the STI to get more dividends, or should I just start with my desired monthly contribution and slowly build up.

you shouldnt buy with the mindset of collecting more dividends. what if you put more lump sum and STI plunges in the beginning?

since you said you have quite a substantial amount of savings, why dont you select 2 bluechips and put in $1k a month in the following plan.

Share Builders Plan

continue putting into the plan for the next 2 or 3 years. that will cost you 24k or 36k in total. you can pick STI ETF and another bluechip of your choice.

within the next 2 or 3 years, there is likely to be a new financial crisis and you would probably have average out the cost of your shares following the down and up cycle.

and hold your shares for a minimum 5 years period.

 

[galapogos]

Hmm, ok. Looking at the historical graph, it does seem that the STI is quite high now, so I guess I'll start with my desired monthly contributions and only pump in extra when it's lower.

 

[kkcy93]

continue putting into the plan for the next 2 or 3 years. that will cost you 24k or 36k in total. you can pick STI ETF and another bluechip of your choice.

Just curious, why pick STI AND another blue chip, since STI would probably already have that blue chip included?

Also, with a large amount to invest, a study by Vanguard has shown that historically, investing it all at once will beat dollar cost average 2/3 of the time. If you are interested, you can read the paper by Vanguard or simply google Lump Sum Investing vs Dollar Cost Averaging.

And finally, regarding STI being too high now, some believe that timing the market is never good. What if it goes up further? Do a quick google search on "market timing" and there are many articles against it. There are some good discussion on the Boglehead forums on this.

 

[havetheveryfun]

Also, with a large amount to invest, a study by Vanguard has shown that historically, investing it all at once will beat dollar cost average 2/3 of the time. If you are interested, you can read the paper by Vanguard or simply google Lump Sum Investing vs Dollar Cost Averaging.

beat it 2/3 of the time.. what about the 1/3 of the time?

both of it have their own advantages and disadvantages, but I think dollar cost averaging is mainly to minimize the risk in case of anything major crisis.. for instance if you put everything in this month.. then next month out of no reason there is a financial collapse, you would never be able to recover

 

[kkcy93]

It is definitely to reduce risk, and also a psychological benefit in that if the market does crash, you wouldn't feel so bad. It's just to point out that on average, LSI is better than DCA.

 

[wahkao3]

you shouldnt buy with the mindset of collecting more dividends. what if you put more lump sum and STI plunges in the beginning?

yes... do not be so hard up over dividends

 

[wahkao3]

always keep this chart in mind and memorize it by hard

 

[focus1974]

Hmm, ok. Looking at the historical graph, it does seem that the STI is quite high now, so I guess I'll start with my desired monthly contributions and only pump in extra when it's lower.

Good choice.
For beginner, the slow incremental capital risked in the stock market will allow you to find out your temperament. Do you really believe in your investing strategy.

Some people think they are ready to average down a losing position ... some people think they are ready to cut loss on a position... some people think they are unfazed by a 10% loss in their portfolio...

but you will never know until the rubber meets the road. then you will know whether you are a good driver ...

Got some driver ..think they super good.. go drive ferrari.. and end up crashing it in a testdrive...

 

[Bedokian]

Thanks Bedokian!

Quite a noob in investing. I understand the concept of dollar averaging by investing an amount every month in the STI. However, I have quite a substantial amount of savings that isn't doing much otherwise, so I 'm wondering if it is prudent to pump in a larger initial amount into the STI to get more dividends, or should I just start with my desired monthly contribution and slowly build up.

Welcome. By my this reply you would have gotten some answers from the other forummers.

You could read up to find out more on investing, see and learn other people's strategies and portfolios, and settle on a suitable one for yourself. I am still learning myself now.

 

[galapogos]

Just curious, why pick STI AND another blue chip, since STI would probably already have that blue chip included?

Also, with a large amount to invest, a study by Vanguard has shown that historically, investing it all at once will beat dollar cost average 2/3 of the time. If you are interested, you can read the paper by Vanguard or simply google Lump Sum Investing vs Dollar Cost Averaging.

And finally, regarding STI being too high now, some believe that timing the market is never good. What if it goes up further? Do a quick google search on "market timing" and there are many articles against it. There are some good discussion on the Boglehead forums on this.

Thanks for that pearl of wisdom. Will research more on lump sum investment vs dollar cost averaging.

 

[alexchia01]

Thanks for that pearl of wisdom. Will research more on lump sum investment vs dollar cost averaging.

It's not lump sum investment vs dollar cost averaging.

It's market timing vs dollar cost averaging.

Lump sum investment at the wrong time is worst than dollar cost averaging.

Lump sum investment at the right time will always perform better than dollar cost averaging.

 

[Mecisteus]

Just curious, why pick STI AND another blue chip, since STI would probably already have that blue chip included?

Also, with a large amount to invest, a study by Vanguard has shown that historically, investing it all at once will beat dollar cost average 2/3 of the time. If you are interested, you can read the paper by Vanguard or simply google Lump Sum Investing vs Dollar Cost Averaging.

And finally, regarding STI being too high now, some believe that timing the market is never good. What if it goes up further? Do a quick google search on "market timing" and there are many articles against it. There are some good discussion on the Boglehead forums on this.

STI is made up of 50% banks, 3x jardines and singtel. by adding another bluechip like capmall, keppel corp or ste, you can further diversify your holdings or add some alpha into your overall returns. also to take advantage of the lower cost of the plan with 2 choice of stocks.

investing is about probability of success. for an example, 10% of the times, you can earn high returns by market timing but 90% of the times, you can lose money. overall, your expectation returns can go negative if you simply sucks in your timing and stock pickings.

 

[wahkao3]

galapogos wrote:

Hmm, ok. Looking at the historical graph, it does seem that the STI is quite high now, so I guess I'll start with my desired monthly contributions and only pump in extra when it's lower.​

imagine you pump more money at the so called correction and it happens to be #5 and #6 ? Very sad right?

[/QUOTE]

 

[wahkao3]

by adding another bluechip like capmall, keppel corp or ste, you can further diversify your holdings or add some alpha into your overall returns.

i disagree
diversification will not give you alpha
instead, i think it will give you beta instead of alpha


nevertheless, diversification is a good idea. split your eggs in different basket

 

[wahkao3]

investing is about probability of success. for an example, 10% of the times, you can earn high returns by market timing but 90% of the times, you can lose money. overall, your expectation returns can go negative if you simply sucks in your timing and stock pickings.

yep, truely agree.
its about probability. You invest in high probabilistic opportunities
AKA low risk, high return opportunities