Historical Rolling Returns - DCA into STI

[OngHuatHuat]

I already gave you the reply in another thread.

Seems like sti etf capital gain is close to negligible after taking into consideration of transaction cost. And this is the dca result of 20 years.

Dividend is around 2.x % per annum.

http://forums.hardwarezone.com.sg/money-mind-210/temaseks-portfolio-drop-5411284-4.html

Post 49 to 60. I talked about DCA and you started trolling on how one would have bought the high in 2007 if he had started investing earlier. lol wth...

I did not read the rest of the thread because I didn't feel like getting trolled anymore.

But it looks like you are trolling me again here, refusing to accept the numbers and statistics I provided. I think I will just block you since you appear to be a perpetual troll.

 

[OngHuatHuat]

Actually a more realistic model should be 5 years since SG is entering a slower growth phase and there is no more QE to boost returns.

 

[Mecisteus]

Please link. I didn't even know I troll you before.

Well, I just view dividend reinvested as another form of dca. If you don't agree with it, you can continue.

Can you argue with more widely accepted substances? Your definition of DCA is wrong to begin with.

At the first place, do you really understand what the table shows?

 

[OngHuatHuat]

Can you argue with more widely accepted substances? Your definition of DCA is wrong to begin with.

At the first place, do you really understand what the table shows?

Well, you can keep arguing about DCA with me, but i will still stick to my own thinking. So i think it will still be pointless.

I only look at your conclusion coz I quite lazy to do a DCA model on my own since my own belief of DCA into STI ETF will be a failure after reverse QE.

Dividend yield of STI etf isn't as high as what you have stated in recent years, it should be around 2.x % to 3.x%.
If you take into account commission charge, it will drag sti etf capital gain close to zero.

Not to mention, it is a 20 years model. A better model should be based on recent 5 years due to SG economy growth slowing down and low inflation rate.

 

[OngHuatHuat]

Dividend yield in recent years.

 

[OngHuatHuat]

http://fifthperson.com/2-reasons-why-i-wont-be-buying-the-straits-times-index-etf-anytime-soon/

good read for believers of STI ETF.

 

[OngHuatHuat]

Its rather silly to assume that SG companies are automatically doomed as soon as local population growth starts to taper off. Many of the index constituents on STI don't even sell their products in SG, Wilmar's major market is China, and Singtel gets a huge % of their revenue from Optus in Australia. Banks like DBS have significant business operations in Asean and China, OCBC's subsidiary, Wing Hang, is based in HK China.

@perisher

Already quoted.

 

[Mecisteus]

Very few investments will yield 8% long run in the current macroeconomic environment. I'd be happy with 5% given the fact that govvies yield next to nothing now.

Actually 8% total returns is what was mentioned in books. And the books are based in the US market.

US market can really reach higher returns.

 

[OngHuatHuat]

Singapore inflation rate:
Normal higher inflation rate means stronger economy growth.

 

[Mecisteus]

@perisher

Already quoted.

Mod, I don't see anything wrong with the word silly. I used that at times.

 

[OngHuatHuat]

Actually 8% total returns is what was mentioned in books. And the books are based in the US market.

US market can really reach higher returns.

I was just saying your rate of return of STI ETF is overestimated.

1. transaction cost not taken into consideration which can easily be 0.25% to 1%.

2. Dividend yield definitely not 4%, it should be somewhere around high 2 % or low 3%.

3. Using more recent years STI ETF return to anticipate future return is more reasonable since Singapore is entering slower growth stage.

 

[OngHuatHuat]

Mod, I don't see anything wrong with the word silly. I used that at times.

Well, I don't really call people silly even though sometimes i really think they are silly. Perhaps just me.

 

[Mecisteus]

Well, you can keep arguing about DCA with me, but i will still stick to my own thinking. So i think it will still be pointless.

I only look at your conclusion coz I quite lazy to do a DCA model on my own since my own belief of DCA into STI ETF will be a failure after reverse QE.

Dividend yield of STI etf isn't as high as what you have stated in recent years, it should be around 2.x % to 3.x%.
If you take into account commission charge, it will drag sti etf capital gain close to zero.

Not to mention, it is a 20 years model. A better model should be based on recent 5 years due to SG economy growth slowing down and low inflation rate.

1) I am not sure why you are always referring to recent years. My study includes 5 to 20 years of period.

2) You need to try to understand the results for 5 years and compare to 20 years. Since you don't bother to understand the table, there is no point discussing further.

3) Maybe you like to start your own thread supporting your thesis that SG is doom?

 

[OngHuatHuat]

1) I am not sure why you are always referring to recent years. My study includes 5 to 20 years of period.

2) You need to try to understand the results for 5 years and compare to 20 years. Since you don't bother to understand the table, there is no point discussing further.

3) Maybe you like to start your own thread supporting your thesis that SG is doom?

Perhaps you can just give me the figure of DCA from July 2012 to July 2016?

I am not saying Sg economy is doomed. it will be more like a L -shaped to me.

 

[Mecisteus]

1. Can u explain how u get 5% pa return? 0.96% + 3-4%?

2. Can u explain how u get 3-4% returns from dividends? Dividend/STI ETF price when declared?

Total return = Capital gain + Dividend yield

What I am calculating is just the 1st half of the equation.

 

[OngHuatHuat]

1 1/7/2016 -0.34% -0.06% 0.91% 1.37%

I got it, so it is -0.34%.

If add in commission charges, this negative return will be more significant.

Okay noted.

 

[Mecisteus]

Perhaps you can just give me the figure of DCA from July 2012 to July 2016?

I am not saying Sg economy is doomed. it will be more like a L -shaped to me.

1) Do you keep your insurance policies for 5 years only?

2) We are still waiting for your thread.

3) The answer to your question is in the table. Feel free to pick any period.

 

[Mecisteus]

I got it, so it is -0.34%.

If add in commission charges, this negative return will be more significant.

Okay noted.

After post #56, now then you try to understand the table?

 

[OngHuatHuat]

1) Do you keep your insurance policies for 5 years only?

2) We are still waiting for your thread.

3) The answer to your question is in the table. Feel free to pick any period.

1. I din put a lot of money into insurance though, perhaps CPF special is a better comparison case?

2. I didn't promise any thread. For me, I am very interested in STI ETF return over the past few years based on different models. That's why you see I am so active here.

3. I found it already. It is -0.34% without considering commission charges. Thanks for double confirm my doubt all along. Thank you for the effort.

 

[Mecisteus]

1. I din put a lot of money into insurance though, perhaps CPF special is a better comparison case?

2. I didn't promise any thread. For me, I am very interested in STI ETF return over the past few years based on different models. That's why you see I am so active here.

3. I found it already. It is -0.34% without considering commission charges. Thanks for double confirm my doubt all along. Thank you for the effort.

1) CPF is definitely not a good comparison
2) Recent 5 years is not a fair period to sample
3) Just minus your cost from total returns