Just look at the price chart — SRX’s real estate index for example. It sure looks like the past 5 years is a bull run. If you were back in mid 2020 and wanted to buy something (with a 1.5% fixed rate mortgage for 5 years and no ABSD), that’d be looking good right now. But now, going forward? Who knows, but personally I wouldn’t (and don’t) peg ~80% of my net worth to this stuff. Either way I doubt a heavy YouTube ad campaign with an AI generated voice would convince me.
Not really, not much. Keep it up, I guess. Congratulations.
I bought iwda, isac and vwra in sequence over the years to diversify issuer risk although admittedly shouldn't be large. I switched when the holding in one is deemed large enough in my opinionJust look at the price chart — SRX’s real estate index for example. It sure looks like the past 5 years is a bull run. If you were back in mid 2020 and wanted to buy something (with a 1.5% fixed rate mortgage for 5 years and no ABSD), that’d be looking good right now. But now, going forward? Who knows, but personally I wouldn’t (and don’t) peg ~80% of my net worth to this stuff. Either way I doubt a heavy YouTube ad campaign with an AI generated voice would convince me.
Not really, not much. Keep it up, I guess. Congratulations.
I think you could simplify life a bit. How about consolidating the oddball CFA, QL3, N6M, O9P, and A35 into your other holdings? Or possibly into CRPA, although you probably can’t do that if those particular funds are inside SRS or CPFIS accounts.
ISAC and VWRA are really the same thing, just from different fund houses. It doesn’t really matter, but did you switch between them for share price reasons? Just curious.
OK, I see. IWDA and ISAC are both from Blackrock iShares, and IWDA is your "legacy" holding. So you're basically just holding IWDA and adding to ISAC and VWRA to maintain a roughly 50-50 split between Blackrock and Vanguard, right?
ES3 is very REIT heavy (and seems to be getting REIT heavier), so you could simplify things by shifting CFA quasi-laterally into ES3. The rest (A35, O9P, N6M, QL3) are bond funds. If you want simplification (not a bad thing) you could move those 4 bonds funds quasi-laterally into CRPA (outside SRS/CPFIS) and MBH (inside) for example.
Right! 80% is too much overweight.Just look at the price chart — SRX’s real estate index for example. It sure looks like the past 5 years is a bull run. If you were back in mid 2020 and wanted to buy something (with a 1.5% fixed rate mortgage for 5 years and no ABSD), that’d be looking good right now. But now, going forward? Who knows, but personally I wouldn’t (and don’t) peg ~80% of my net worth to this stuff. Either way I doubt a heavy YouTube ad campaign with an AI generated voice would convince me.
In modest defense of real estate for a moment, there are some households with growing piles of compulsorily saved CPF Ordinary Account dollars that they don't know what to do with. So they end up buying more and bigger homes than otherwise since that seems like the "default."Right! 80% is too much overweight.
And even in the bull run, the return is not higher than stock market, without leverage. Another reason not to overweight.
Thank you, BBC!
So to balance vanguard and I shares, my holdings of iwda/isac vs vwra should be 50:50?
If your goal is to roughly split your assets between fund managers then you'd count all Blackrock funds in the Blackrock bucket and all Vanguard funds in the Vanguard bucket. (And other funds with their respective fund houses.) IWDA and ISAC are both Blackrock funds. VWRA is a Vanguard fund.
Yeah, OK, but I think there's merit in simply closing out small positions and shifting them into the few vehicles you want to ride into the sunset. It's at least easier to rebalance that way. In fact, that might be the way you do it. At your next rebalancing event (which is once or twice per year presumably) you could close out those "little stray" funds first. For example, if you're rebalancing from stocks into bonds then sell CFA first (since it broadly fits into the stock bucket). If you need more ES3 (relative to VWRA/ISAC/IWDA) to rebalance to your target local-global portfolio percentages, buy more ES3 with the proceeds from CFA. (Yes, I know CFA is "regional," not quite global. But for these purposes it'd be in the "global" bucket.)
Hopefully, CPFIS could be as efficient as cash investment in terms of options and fees. This could be more effective in encouraging and facilitating long-term investing because OA is pretty much long-term dollars by nature.
In the practical sense, the chance of a major fund house running into trouble is slim. In that slim chance, after trustee figuring out who owns what, what are the chances of investors losing partial or all if their portfolio with that fund house?
It's not. The charges the "Big 3" banks currently levy on CPF Investment Accounts assure that there are higher costs investing OA dollars compared to investing unrestricted dollars. But the cost differential has narrowed a lot.
Even more slim. And please note these long tail risks are not specific to Blackrock and Vanguard. They apply to all asset custodians no matter where they're located. For example, hypothetically the Singapore Land Authority could screw up — or be the victim of a successful attack even if the SLA has done their very best — and lose track of who owns which real estate in Singapore. In that unlikely event it would presumably take some nontrivial period of time to reconstruct Singapore's title records. In the meantime, property sales would presumably be temporarily suspended at least for existing properties.
It's the sort of thing you might worry about if you've run out of things to worry about.
I'll be honest. I haven't rebalanced before as I'm just buying into the major components as I get my salary and bonus. But I get your advice and appreciate it
I think it'd be better not to try to time interest rate cycles. As I think about it more, I really like the idea of using your "stray cat funds" as the first sources of dollars for your next (first) rebalancing events. For rebalancing purposes CFA is in the "global" and "stock" buckets. QL3, N6M, and O9P are in the "global" and "bond" buckets. A35 is in the "local" and "bond" buckets. So you'd simply drain those respective "stray" funds first depending on which bucket(s) you're trying to rebalance toward. For example, if your bond-stock ratio is on or near enough your desired target but your local-global mix of bonds is off target then....
Actually given N6M and o9p are in usd already, perhaps makes more sense to move to crpa. But need to incur cost to move that usd from fsmone to ibkr.
There's a cost to rebalancing regardless, so that's a good time to incur such costs.
CFA is in the "global" and "stocks" buckets (closest fit anyway). CFA would shift in one of 3 directions when rebalancing (if you need to rebalance in any of these directions):
