CPFSA vs Funds

[rarenick]

I bought iFAST First State Bridge using my CPFSA since Sep 2007, and the profit to date is only 1.17%.

Hence, should I still park my CPF money with iFAST / First State Bridge, or should I just close it and park the money back to CPFSA?

Thanks.

 

[iCuteCube]

Just park your $$ in whatever what generate you more returns.
Since FSB is returning you 1.17%, it is below what CPF returns, therefore put back in CPF and think about better alternative.

Check out bluechipstocks after XD.

 

[rarenick]

can use cpf to buy bluechips? how to go about?

 

[limster]

frankly, any reasonable investment portfolio will treat the CPFSA as the bond portion of the portfolio and leave it untouched. People who invest their CPFSA are probably under the influence of an agent

 

[bbmars1128]

FSB return 1.17%? I am not too sure about that. I believe you had already been issued with dividend units over the past few years. Have you factor those in? If yes, then too bad. Of course, buying in 2007 doesn't really help as the unit price is somewhere near what it is currently. So you don't make much actually. CPF would gives you better rather. My anuties and cousin also own this UT. They bought just after the recession started.

Who did you buy it from? FSB is also on my radar, but I don't own any since I sold it last year. I been using CPFSA to buy this fund since 2000, buy - sell, buy - sell type. market turn bad, sell and keep profit, recession keep in CPF earn 2.5% interest. Market turn good, buy and wait for chance to sell. Miss opportunity? Not sure don't buy like now... only own Aberdeen Malaysia and Indonesia. Bought a little to test market.

I do my own buying from POEMS or Fundsupermart. Want to earn $$, need to do some homework. Can't trust agent to do it for you. their aim, make commission from you, the more the merry, so they encourage you to buy. buying online is cheaper than from agent... so you may want to conside this.

 

[bbmars1128]

can use cpf to buy bluechips? how to go about?

open trading account, and make sure you ahve excess of the 60k before you can trade. I am doing that since 2002

 

[henrylbh]

Personally, never ever use CPFSA for investment. No investment can guarantee you 4% with no loss of capital.

If CPF Board allows me to transfer more than min sum to SA, I would move every cent in my OA to SA than to use my OA for shares.

 

[bbmars1128]

Personally, never ever use CPFSA for investment. No investment can guarantee you 4% with no loss of capital.

If CPF Board allows me to transfer more than min sum to SA, I would move every cent in my OA to SA than to use my OA for shares.

I would not say that as I am one such person that didn't loose $$ in my CPFSA UT buying over the years since year 2000. Of course, for most people, unless you do your homework, I would advise better to leave it in CPF for that 4% interest. However, my target is 5% at least, so I choose to invest. I do not buy and hold for LONG term. I mean, unlike old time, buy and hold. When I am familiar with the market condition, I invest, else, leave it in CPF to earn interest. Recession year definitely out of market, recovering stage, invest. Right now, I only have 8K lock in using CPFOA to "test water". Condition not good, I would sell out, cut lost or condition recover, invest more.

It all depends on you, Its not always a winning game, but over the years, I made and average of 10K/year since 2000. This includes those years where I did nothing and earning CPF 4% due to good profit from market recovery. Not forgetting the interest earn from CPF. My colleague who once followed me made more than what CPF gave him over the years. He had since sold all his holding last year.

 

[bbmars1128]

I would not say that as I am one such person that didn't loose $$ in my CPFSA UT buying over the years since year 2000. Of course, for most people, unless you do your homework, I would advise better to leave it in CPF for that 4% interest. However, my target is 5% at least, so I choose to invest. I do not buy and hold for LONG term. I mean, unlike old time, buy and hold. When I am familiar with the market condition, I invest, else, leave it in CPF to earn interest. Recession year definitely out of market, recovering stage, invest. Right now, I only have 8K lock in using CPFOA to "test water". Condition not good, I would sell out, cut lost or condition recover, invest more.

It all depends on you, Its not always a winning game, but over the years, I made and average of 10K/year since 2000. This includes those years where I did nothing and earning CPF 4% due to good profit from market recovery. Not forgetting the interest earn from CPF. My colleague who once followed me made more than what CPF gave him over the years. He had since sold all his holding last year.

So sorry, I would say, the profit gain is for investment in both Stock and UT(CPFOA & CPFSA) with the bulk of the investment coming from UT (~35% in stock). However, I must say, ~30% profit from UT. My last big profit from CPFSA UT that I made close to 50% in 1 year. Even that, I would say big thank you to CPF board for implementing the 60K cut must have in CPF before investing. If you are really not into this, better hold it in CPF and earn interest..... make to make extra, need to do home work...

 

[limster]

Many people see the return but not the risk, so they see no need to have a bond portion to their investment portfolio, even though this is standard advice in the good investment books.

Risk adjusted return I guess is a hard concept to grasp. Most people don't even know the difference between alpha and beta.

Henrylbh has financial background so I would give some weight to his views about CPFSA.

see also TKL's views: http://tankinlian.blogspot.com/2008/02/keep-your-money-in-cpf-special-account.html

 

[bbmars1128]

Many people see the return but not the risk, so they see no need to have a bond portion to their investment portfolio, even though this is standard advice in the good investment books.

Risk adjusted return I guess is a hard concept to grasp. Most people don't even know the difference between alpha and beta.

Henrylbh has financial background so I would give some weight to his views about CPFSA.

see also TKL's views: Keep your money in CPF Special Account | Tan Kin Lian's Blog

Would only agree with him only if you are not interested or don't know how to do it. Of course, it doesn't mean do it yourself sure win $$$. There are always risk involved but you need managed you risk and strategise how you invest. Not sure? my only anwser is "DON'T" invest, just keep it in there for your 4%..... which is to me, still rather good, better than any back rate. However, given the high inflation (higher than CPD rate), then we are stil loosing $$ leaving it in CPFSA.

 

[Kenny23]

which reminds me i wanna sell my fsb in my sa...got it in may 2008 n only earned 11+% including dividend..zzz maybe i will sell it after collecting dividends in may

 

[Majestic12]

Do not use your SA for mutual funds - the potential gains do not outweigh the guaranteed return.

As a Relationship Manager, I am always amazed when meeting new clients whose bankers recommended First State Bridge using SA funds.

 

[bbmars1128]

Do not use your SA for mutual funds - the potential gains do not outweigh the guaranteed return.

As a Relationship Manager, I am always amazed when meeting new clients whose bankers recommended First State Bridge using SA funds.

BUt you have not met me who had made profit from this fund since 2000. I don't really bother whoever talk to me about whatever investment. I had my own advisors on investment but I never listen to them untli they themselves were convinced by whatever I am doing. They also had no answer to some of my queries. I shared with him what I had gone through and what I had done to gain my profit using CPFSA. However, the fund seems to be trading side way for sometime.... Guess what, I am not invested now.

If you really look around what UT you can invest using SA, very likely, you don't have much choices and if you were to survey around those available for SA investment, most aren't doing well either or not meeting my expectation. I am not saying 1st State Bridge is the best, what I am saying is, it is one of the better choice to invest given the opportunities. But you need to do you home work. Don't just invest blindly like my anuties and cousin did. When I sold off all my UT, they went in to buy.... of all, listen to advisor from DBS... What's more, they pay with CASH. Of course, their return for now, slightly better than what the bank pays for interest.

2 other SA funds I look forward to buying, Lion SG balance fund and PineBridge Acorns of Asia which used to be under AIG.
These 3 funds in 2011 feb, I sold off all my holding and make ~38K after ~1 yr, something like 35% return. It was during the early days of the bull market and also thanks to CPF board for putting the 60K limit for investing...... I pump in 50K into Acorns and make 28K return.....

 

[limster]

BUt you have not met me who had made profit from this fund since 2000.

If you are able to beat a 4% risk-free return for 12 years straight from 2000-2012, you should be earning millions of dollars a year as a fund manager/trader/banker.

Actually, pls take a look at the First State Bridge factsheet. Inception date July 2003. You are making profit from this fund since 2000? Fantastic.

 

[bbmars1128]

If you are able to beat a 4% risk-free return for 12 years straight from 2000-2012, you should be earning millions of dollars a year as a fund manager/trader/banker.

Actually, pls take a look at the First State Bridge factsheet. Inception date July 2003. You are making profit from this fund since 2000? Fantastic.

I think you miss some of my points. I only use CPF for investing, don't have that much CASH to invest. How much do you think I have for investment given my situation, millionaire? How I wish I have that much to invest. Further more, if I have the $$$, I won't bother to invest in UT, rather buy stock. I am just trying to maximixe my CPF $$$. Besides, I am in and out of the market. Bull run, I invest, recession, I sell out. I don't hold on my unit/stock at all. From 2000-2012, there are few times where I am out of the market. Like the last recession in 2007-2008. I sold out all my UT/stock after the 1st sell out and I think few months later recession came. So I am not invested. So, it is really 12 years? I only started investing again in 2009 sometime in Apr 1 month after the bull take off and when I sold all my position, UT/Stock, I made 71K from total investment, 110K (35% stock & 65% in UT). My biggest UT gain from a single fund, Acorns of Asia, 50K given me a return of 28K when I sold off in Feb 2010. In between this period, I wasn't very sure that the Mr BULL is here to stay, I sold off my UT/stock, make some $$$ then buy back again.



When the recession was almost over in 2000, I started investing till the next one came along few years later, I was very conservative, not sure what to do and when recession hit, I broke even, didn't loost anything from UT. However, I lost 40K in stock. Did you not know that UT like the then OCBC Thailand, Korea funds actaully hit a return 154% and ~100% respectively in 1 year? those were the days. If you hold on to your UT now, may be your return is less than 100%, I don't know, but I do know by next recession comes, I was out of the market and my CPF investment $$$ is back to CPF to earn 4% interest. I said I break even because I was new to this and wasn't sure untill the recession is really here then I sold off my unit. Ended up with no profit.

All in all, in and out of market numerous time, uncertain time, don't invest. Not sure, don't invest, rahter sell off with lost, cust the pain short and sleep for the next round then hold and and seel feel the pain of it every now and then. You can just check out many of the Tech UT, they are never back to their peak prices, in fact trading way before the original selling price of $1.. Things will never be the same again unlike the old days where you can buy with both eyes closed, every thing make $$$. these kind of strategies no longer valid, even analysts and experts tell you this. That's why you can have that many free switches in investing your UT... In fact, that's what fund managers advise you to do so...

 

[bbmars1128]

FYI, I diversify my risk in UT by spreading my investment, not just in 1 funds, but several of them. Something that I have been doing all these while. As for CPFSA, no choice due to limited funds available for investment. I narrow down to the so call best 3 at that time.

1. then AIG Acorns of Asia = PineBridge Acorns of Asia now
2. then OCBC SG Balance Fund = Lion SG balance fund now
3. 1st State Bridge

When I sold off these 3 funds on 2007/8 before the recession, return of investment for 10 months the following returns:
1. Acorns = ~28%
2. SG Balance fund/1st state Bridge = ~20-25%

Last year, I sold all these 3 funds at a lost but overall, I still make 8K.
These funds isn't doing well till now, more like moving side way.. I am not invested in any of these at all. So I am earning 4% from CPF now.....

 

[Dividends Warrior]

Sighz.......

 

[bbmars1128]

Started out as UT investor in 2000, invested in numerous Funds. Had no idea what really to buy but just on charting information which I did by searching POEMS chart. Made some mistakes and by the next bull run, more or less I have and idea what should I invest and where my focus would be. Again, make some mistakes, but few this time round.

However, as I could recall, definitely invested CPFSA into Acorns and OCBC SG Balance fund. 1st state bridge only comes towards late. But what I am saying is, don't be deterred by bad experience and pprevent you from investing your SA $$$.. I pay "school fee" and learn my lesson. I want to maximise my gain and as mentioned my target is 5%, 1% more than CPF SA interest rate at that time and I still do. So long as overall, I make more than what CPF can give me, I am happy. Of course, who doesn't want to get more. However, don't be GREEDY because that's what many people who invest are. I met many other like minded people just like myself, but they invest with CASH. I guess I am one of the very few using CPF. Some of them don't even bother to invest their CPF, just too trouble some and more charges incurred due to merchant bank fee...

My anuty's case is a good example, she knew I invest in UT but decided to not to seek 2nd opinion. Seek agent help.... Pay more commission, get lesser and still holding on the 1st State Bridge UT total 80K. I get out of market she got in just at the start of the recession.

A Colleague of mine, advised him to invest in Acorns for a few several years back during the start of bull market. He refused and told me off saying return not good, prefer stock, UT earning is miserable. Guess what, a few years after that, he and his wife invested a total of 100K into Acorns a few months just before the last BULL run ended and then, .... needless to say. BLEED like hell when recession started. Currently, I think the fund is either break even of loosing a little while I had already make $xxxxK from it. I had the best laugh and he complained about me to my other colleagues. I told him off, what friends are you when I advised him to invest even showed him my holding and record yet he told me off, but a stranger ask him to buy, he did. Worse, he paid 5% commission whereas, I paid 0.5%.. WHAT A JOKE!!!

At least for now, the overall the profit is slightly better than what the banks pay interest but lesser than CPFOA interest. For me, I am holding on my many times more than what she gets and still earn 4%....

At the end of the day, If you want to earn some profit, you really need to know what you really want and plan your strategy, cut lost if need to, can't be EMOTIONAL = something very IMPORTANT. The market is always there, but will you survive the lost and be around to gain what you LOST? something I learn even though I am still no expert in investing but I know at least, how to protect my captial and fight another day

 

[bslow27]

Please update if your are back in FSB etc..