info for beginners

[Epps_Sg]

Bonds basically you cant buy because is Over The Counter (OTC) and only for institutional with significant amount of investment. So, only a safe-cum-defensive-cum-low volatility stocks fit your capital and risk appetite.

Money market fund? I don't think your initial capital is sufficient for this. Moreover the return can be as low as $10 a year for you, not very meaningful right.

Singapore Government bonds can be bought on Singpore Exchange since 8 July 2011. http://forums.hardwarezone.com.sg/money-mind-210/trade-sgs-sgx-july-3271917.html
For example, the 30year Singapore govt bond currently sells at about $108 per unit. One lot is 10 units, so cost of one lot of Bond is around $1080. Yield is about 2%+.

If you put it that way, $10 returns is really a bit low. well can at least say been there, done that... I think if put in poems account, automatically spare cash is put into money market fund?

 

[remy3413]

My advice would be to read up on value investing, which has proven to be a long-term sustainable philosophy of investing with a margin of safety. I notice this method of investing is not really discussed much or advocated in this forum - mostly people talk about dividend investing or "yield" investing.

Do note that yield itself is not an indication of the merits of an investment. The underlying business must be strong to ensure the yield is sustainable, and it also depends on the capital structure of the entity/security and the cash flows it generates.

Understand the investment and risks involved - this is far more important than trying to grow your money. Basically, protection of downside is of greater importance than chasing for upside. Invest with an eye on the business, valuations and cash flows and you will not go wrong.

I have been doing that all the while Thumbs up, finally someone speaks about value investing

we only got 3 types of investors here - dividend investing, value investing and traders

 

[Futureskid]

Futureskid - It's my first time, so i have a sort of a ''play it safe'' attitude, and using this sum of money to at least kickstart my venture into this unknown field. ( i guess it is also my personality to not go into big risk projects immediately)
Another reason is because my capital is low, if i were to invest in shares with big risks which i understand is a big part of my capital, it will be too damaging for me , hence i want to avoid this situation for now.

DW - REITs is quite appealing to me , but I am personally quite new to this and am just exploring my options and learning what type of things i can invest in ( i have earmarked a couple types? and i would be doing research or asking the forumers here)

maliciousmonster- At this point in time untill the new few years( 3-5) the dividends yield to be honest does not matter to be, for the 1k will just be sitting in my bank collecting interest and I am confident i will have emergency cash on standby too. Since this is my spare cash stash, I am happy with 50/year . ( i think. hahah)

Hoo8899- thanks for your suggestions ! but for now i am not keen to dive straight into investing- would at least like to look into how the market in SG works, for this book i am reading is in USA's context .
However, I have a question, your advice is for me to buy 2 lots- IE , my entire capital of 1k is put into it, wouldnt it be risky?
Or do you mean for when my capital is larger?


----------------------
Based on my reading today, am i right to say that my current investment options is stocks? ( other options is above my capital) . Even so, where can i find a catalogue(if you may) of bonds, stocks, ETF , REIT and indexes?
Do the catalogue also at least provide charts of past growth , etc,?

Lastly, I am thinking of putting my capital into money market fund to grow my capital ( any comments/insights about this?) Because all i know is that it offers a low yield, but at least higher then banks for the short term but the downside could be that the amount deposited is not insured by the government.

TAXES-How would this affect my investment in singapore? Is there a website I can access to find how how taxed investment profits affects me?

(incoherent post- could be updated_

What makes u think that REITs, ETFs are safer than ordinary company shares? Reits are just another stock traded with a higher yield in dividends, and ETFs are customized products passively managed, which differ in nature from one another, not to mentioned the risks which u can find in SGX website

$1000 to u now may be huge, but will be peanuts after u start working. Either u try to leverage, or u put in saving account if u r not a risk taker, no point trying to earn few bucks in a year and risk money trapped or loss partially. If u can't take risk, then capital guaranteed products is suitable for u, which is fix d or whatever saving plans.

P.S. Just saw u decided in money market after i wrote so much, so i lazy to erase them

 

[Sinkie]

i see... at this pt of time with what is told to me it seems that Dividend stock and Passive portfolio investing is what i need to look into. thanks for the information .

am i right to say that opening an account and how to buy and sell stocks or bonds will be stated on the broker firm website?

what other information would i need to start investing?

i welcome other suggestions =)

read up the sticky

How to Open a Stock Trading account in Singapore-Updated 2012 - Page 7 - www.hardwarezone.com.sg

 

[Sinkie]

Initially I started off my 'investment' with a 4 year AUD structured deposit because i was not able to learn any other investment strategy that i believe i could pull off, so dont be afraid to start simple till you learn an investment strategy that you think you can pull off, even if its money market fund. What i got out of the simple structured deposit was more sensitivity to the market and forex, which helped in my further learning later on. If you want, just park your money in Phillip money market fund first, then one thing can follow another, you can take your next step when you learned enough - at the very least you can start some low risk 'investment' and tell your yourself you have taken a step beyond the 'savings account' stage, then keep the momentum going.

Phillip Securities website is quite informative abut ETF, unit trusts and stocks. I also use Yahoo! Finance to view charts and historic data. Frankly speaking, i mostly use 'Stock Watcher' app on my Android phone to check stock, ETF, bond, gold price and chart etc as well as my portfolio returns. Since i dont actively trade or analyse stocks, the simple app is enough for me. Oh i also read Bloomberg's World, Economy, and U.S., Commodity, Bond and Currencies news on the Bloomberg Android app almost everyday, as I am more of a macro economic investor.

There's no capital gains tax, interest tax, dividend tax for your investments here in Singapore.

You can go to the investment club and see what they are doing, then come tell us what you think If you can get even one good idea there or gain some knowledge, its good isnt it? If you listen and dont understand, then at least you know what are the things that you dont know and may still need to learn.

i see the interest for poems mmf is now at 0.59%

then might as well park the fund in cimb saving accounts which is giving out 0.8% interest rate?

Welcome to CIMB

for cimb banks, there are only 2 atm located in the whole island, singapore land tower and orchard so when you need cash immediately, you just need to go down to the atm to withdraw compared to when you put your money into the mmf which might take a few days later to process.

 

[Sinkie]

Not much of a pro here. But just to share abit of my experiences. I started off by getting a POEM account and got into Shares builder plan. Been doing that since my uni days for $200/month. With 1k i dont think you can buy much. You could try out shares builder plan like me. It keeps you disciplined to come up with that $200 per month. It's like saving. Btw, share build plan is a platform for dollar cost averaging method. Dollar cost averaging will help lower risk also. SBP gives you the option to buy most of the blue chip in SG. you can also purchase STI ETF in SBP. Now I mainly do mid to long term investment =)

i given my view on share builder plan on post 57 onward

How to Open a Stock Trading account in Singapore-Updated 2012 - Page 4 - www.hardwarezone.com.sg

there is only 19 shares that can be used for this plan.

 

[Dividends Warrior]

i given my view on share builder plan on post 57 onward

How to Open a Stock Trading account in Singapore-Updated 2012 - Page 4 - www.hardwarezone.com.sg

there is only 19 shares that can be used for this plan.

All solid stocks.

Out of the 19, I have 4 of them. Singtel, Starhub, SPH and CapitaMall Trust.

 

[Epps_Sg]

I have been doing that all the while Thumbs up, finally someone speaks about value investing

we only got 3 types of investors here - dividend investing, value investing and traders

my view is we got 3 main types of investors here - dividend investing, value investing, passive portfolio investing with (multi asssts).

I dont really count traders as 'investors' - their risk rewards appetite are quite different from those of long term investors.

 

[Sinkie]

my view is we got 3 main types of investors here - dividend investing, value investing, passive portfolio investing with (multi asssts).

I dont really count traders as 'investors' - their risk rewards appetite are quite different from those of long term investors.

we 'invest' for as short as 1min

 

[blackvice]

i given my view on share builder plan on post 57 onward

How to Open a Stock Trading account in Singapore-Updated 2012 - Page 4 - www.hardwarezone.com.sg

there is only 19 shares that can be used for this plan.

Sinkie , now is 21 counters liao with addition of GLP & "Sabrina" reit

 

[Sinkie]

Sinkie , now is 21 counters liao with addition of GLP & "Sabrina" reit

thanks for the head up

made changes to the thraed already

 

[doody_]

Wonder what's the criteria for being included into the SBP... Is it like a stamp of approval for the stock?

 

[Sinkie]

Wonder what's the criteria for being included into the SBP... Is it like a stamp of approval for the stock?

Looks like most of them are backed by temesak and gic

 

[yihao93]

hi guys, just got home, would like to say that i have read your suggestions and i will think about it. I guess for now i will just focus on opening an account( need see with who) first then money mkt funds(which i will add money regularly from my pay to increase capital) followed by bonds/stocks/etfs.( 1~2 years later, hopefully) but i will definitely need to relate what i have learnt to SG context , ASAP

 

[Sinkie]

hi guys, just got home, would like to say that i have read your suggestions and i will think about it. I guess for now i will just focus on opening an account( need see with who) first then money mkt funds(which i will add money regularly from my pay to increase capital) followed by bonds/stocks/etfs.( 1~2 years later, hopefully) but i will definitely need to relate what i have learnt to SG context , ASAP

what are the money mkt funds that you are looking at?

 

[Mecisteus]

Sinkie , now is 21 counters liao with addition of GLP & "Sabrina" reit

i am surprise that sabana is included also.

 

[yihao93]

what are the money mkt funds that you are looking at?

haven done a search. but basically I am looking for one that 1)offers a mid/high interest and 2)is guaranteed( i have no idea if funds in SG is insured)
also preferably )one that allows me to invest my money with minimal operating expenses and also4) one i can transfer funds into from my bank .

for now these will be criteria, i will need to review what i have learnt to further refine what i want.

on another note : at first glance it would seem wise in invest in DCA platform and short term bonds(eg the one offered by SG Govt) as compared to just letting it earn interest( although these decisions will present a new set of questions for me

 

[Epps_Sg]

haven done a search. but basically I am looking for one that 1)offers a mid/high interest and 2)is guaranteed( i have no idea if funds in SG is insured)
also preferably )one that allows me to invest my money with minimal operating expenses and also4) one i can transfer funds into from my bank .

for now these will be criteria, i will need to review what i have learnt to further refine what i want.

on another note : at first glance it would seem wise in invest in DCA platform and short term bonds(eg the one offered by SG Govt) as compared to just letting it earn interest( although these decisions will present a new set of questions for me

Hmm... just be aware of following charges for holding SG govt bonds:
"23. Are There Any Fees For Individual Investors Custodising SGS With CDP?
CDP will charge investors an administrative fee* of 0.08% (8 basis points) per annum of the face value of the SGS per annum. This administrative fee will be deducted during each coupon payment or redemption of the SGS and T-bills, and is subject to a minimum of S$1.50 per deduction. No fees are deducted if the individual investor sells the SGS bonds and T-bills prior to the coupon and/or principal payment events."

The fees may eat into your short term bond returns, so you may need to calculate a bit to see if its worthwhile.

Suggest Phillips Money market funds then, alternative is lion global SGD money market fund. Then you may DCA also with Phillips securities platform's share builder plan. I am not related to Phillips securities. better put money into money funds than buy low amount of short term SG govt bond and pay fees - money market funds and short term bonds both share some similarities anyway.

 

[Sinkie]

Hmm... just be aware of following charges for holding SG govt bonds:
"23. Are There Any Fees For Individual Investors Custodising SGS With CDP?
CDP will charge investors an administrative fee* of 0.08% (8 basis points) per annum of the face value of the SGS per annum. This administrative fee will be deducted during each coupon payment or redemption of the SGS and T-bills, and is subject to a minimum of S$1.50 per deduction. No fees are deducted if the individual investor sells the SGS bonds and T-bills prior to the coupon and/or principal payment events."

The fees may eat into your short term bond returns, so you may need to calculate a bit to see if its worthwhile.

Suggest Phillips Money market funds then, alternative is lion global SGD money market fund. Then you may DCA also with Phillips securities platform's share builder plan. I am not related to Phillips securities. better put money into money funds than buy low amount of short term SG govt bond and pay fees - money market funds and short term bonds both share some similarities anyway.

I am very curious of your choices

1) why would u suggest to put your money with Phillip securities money market fund that gives 0.6% only when you can open a bank saving accounts with CIMB that gives 0.8% per annual?

And iirc Phillip securities is not bank backed, it's money market fund is also not covered by depository insurance scheme too unlike CIMB bank or even Standchart saving account and iirc poems money market fund credit rating is C or something so again why would putting money into a lower interest return and less safer money market fund more attractive than putting money in a bank account that's backed by MAS? And is money market fund guaranted too? And if guaranted, by who? Poems or MAS?

2) I have also discussed the pro of using odd lot market over using this share builder plan from poems, please refer to the link I give earlier

 

[lzydata]

1. The CDP fee for custodising SGS is currently waived. For now I believe there are zero fees or charges for directly buying and holding SGS. (Provided it is done with cash, not through CPFIS or SRS accounts.)

Note:*While calculations in the above examples include the admin fee charged by SGX for the purpose of illustration, do note that the fee is currently waived for a period of 3 years beginning 1 Apr 2010.

2. Indeed money market funds are not backed by deposit insurance or any capital guarantee. In practice the Phillips MMF is used as a temporary place to stash cash while people buy or sell unit trusts on their platform.

The failure of Lehman Brothers in 2008 caused one major US MMF that owned its debt to "break the buck" i.e. fall below its semi-guaranteed NAV of $1, and this resulted in a "bank run". Even though it only fell to something like 97 cents on the dollar it was enough to cause the whole thing to break down and have to be liquidated. Local MMFs do not have this unstable system of sticking to $1 value, but fundamentally they are still directly invested in debt - or more exotic stuff - that could turn sour, and they are completely exposed to bank runs.

Compare that to a plain and simple savings deposit backed by all the resources of a bank, and with the government standing behind it as lender of last resort and with deposit insurance. The smallish additional return in my view is not worth the hassle and risk.