*Official* Shiny Things club - Part 2

[KeytoFreedom]

Hello, what do you invest with your SRS funds...anyone care to share? Is it worth to buy insurance plans (those with annual payouts) or is it better to buy ETFs?

 

[limster]

Hello, what do you invest with your SRS funds...anyone care to share? Is it worth to buy insurance plans (those with annual payouts) or is it better to buy ETFs?

this entire thread is dedicated to Shiny's recommended ETF portfolio and you still want to ask here whether ETF better than buying 'insurance plan'?

its like going to an Apple store and asking whether you should buy an iPhone or Samsung

 

[Pikuniku]

MBH is better if it’s an option for you.

A35 was the best option before MBH was launched, and in some places (notably POSB IS) A35 is the only bond fund offered - which is good, because A35’s still fine.



1- Generally nothing will happen. Your stocks are still safe, because they’re generally held in a ring-fenced subsidiary company that the parent company isn’t allowed to touch. IBKR carries extra insurance as well, to compensate you in case anything does happen. And splitting your accounts across multiple brokers is a massive waste of time and energy. Don’t bother.

2- No, CI coverage is a waste of money, and early-CI is an even bigger waste of money. As long as you’ve got hospitalisation insurance (even MediSave is fine!), you’ve got everything you need.

3- This is a tough question, and reasonable people disagree on it - that’s why I explicitly say in the book that either way is fine. I personally would keep it entirely separate, because if you count your CPF as part of your bond allocation, then your regular account would be basically 100% stocks - and that'd be pretty volatile! It makes rebalancing tougher as well.



I don't know exactly what the fee is, but yes, you're right. A good rule of thumb is to switch over from Stanchart to IBKR when you hit $100k of assets in Stanchart, or when you reach $1k a month of investments.



Not off the top of my head, unfortunately.

Thank you, Shiny

 

[Visa4550]

Hey guys for etfs(like iwda or snp500) domiciled in ireland for only 15%withholding tax, I noticed they are domiciled in many currencies, if I want only 15%withholding tax for Ireland domiciled funds I only buy the version denominated in gbp? Can anyone advise? Shiny things can advise? Please and thank you everybody, newbie here

Sent from Samsung SM-N960F using GAGT

 

[bobobob]

Hey guys for etfs(like iwda or snp500) domiciled in ireland for only 15%withholding tax, I noticed they are domiciled in many currencies, if I want only 15%withholding tax for Ireland domiciled funds I only buy the version denominated in gbp? Can anyone advise? Shiny things can advise? Please and thank you everybody, newbie here

Sent from Samsung SM-N960F using GAGT

Can buy the gbp one or buy the usd version, same thing.

 

[stu4rt86]

Hi, i went through the application of the IB and submitted. Throughout the process they didnt ask me to upload any documentation of my nric or passport. Did i do something wrong? Now application is submitted for approval...

 

[Kopisi_xiudai]

Hi, i went through the application of the IB and submitted. Throughout the process they didnt ask me to upload any documentation of my nric or passport. Did i do something wrong? Now application is submitted for approval...

I just submitted my application on Thursday as well. Yesterday when I login on the page it ask for me to upload my nric for verification. You might need to wait another day or 2.

 

[stu4rt86]

I just submitted my application on Thursday as well. Yesterday when I login on the page it ask for me to upload my nric for verification. You might need to wait another day or 2.

getting iwda too?

 

[Ilovemathstutor]

you pay alot for CI and early CI... and whatever it is, it is barely sufficient.

a cancer at 4th stage costs 1m+ sgd easily, go check if u can really afford it.

CI and early CI gives the insurance agents one of the fattest profits.

just buy the max of the hospitalisation plan, that's the best you can do.

don't fall into their trap.

 

[iceblendedchoc]

you pay alot for CI and early CI... and whatever it is, it is barely sufficient.

a cancer at 4th stage costs 1m+ sgd easily, go check if u can really afford it.

CI and early CI gives the insurance agents one of the fattest profits.

just buy the max of the hospitalisation plan, that's the best you can do.

don't fall into their trap.

Should I drop my CI rider $75k out from my term plan to 99?
Also, wouldn’t there be out of pocket payment for hospitalisation plan like pay 5% or 10% ?

 

[kevinkoh1992]

MBH is better if it’s an option for you.
2- No, CI coverage is a waste of money, and early-CI is an even bigger waste of money. As long as you’ve got hospitalisation insurance (even MediSave is fine!), you’ve got everything you need.

What level of Hospitalisation would you recommend? What about their riders?

 

[Converged]

What level of Hospitalisation would you recommend? What about their riders?

Waaa u 10 years old created this acc alr

 

[lsthekiddo]

Just for info, NIKKO AM is changing the board size for A35, MBH and G3B to 10 instead of current 100.

wef from 19 Aug.

https://links.sgx.com/FileOpen/Nikko-Change_in_Board_Lot_Size.ashx?App=Announcement&FileID=571117

Any reasons for doing so; to increase liquidity or reduce bid ask spread?

 

[confusedsuitguy]

Just for info, NIKKO AM is changing the board size for A35, MBH and G3B to 10 instead of current 100.

wef from 19 Aug.

https://links.sgx.com/FileOpen/Nikko-Change_in_Board_Lot_Size.ashx?App=Announcement&FileID=571117

Any reasons for doing so; to increase liquidity or reduce bid ask spread?

Sounds like good news to me!

 

[peripheral]

Two questions

Hi,
I'm planning to invest $1200 a month.
Month 1 IWDA
Month 2 ES3
Month 3 IWDA
Month 4 ES3
Month 5 MBH

Since I'm only buying IWDA 4 times a year, is it still worth it to buy through IB?
For ES3 and MBH is SCB the best choice?

Thanks!

Yes, because the money you'll save on FX spreads and brokerage outweighs the minimum monthly brokerage you'll pay in the months you're not buying IWDA.

Hello Shiny, I'm a little confused by this. Am employing a similar strategy of buying IWDA 4 to 5 months a year. I've done some calculations in an excel and it seems that paying the elephant USD/SGD spread of 90pips per way is still cheaper than employing IBKR.

Working assumptions:
- Non-SC Priority
- Less than US$100k in IBKR

Resulting fees are ~US$10.70 (x4) per trading month for SC, and US$10.00 (x12) for IBKR regardless of trading activity.

Would like to seek clarification if I'm interpreting this wrongly somewhere.

-----------

On a side note, would you recommend purchasing SWRD over IWDA?

Thoughts in a sequential manner:
- My understanding is that SWRD and IWDA are identical except for the manager
- Assuming monthly investment size of US$2,500
- SWRD has lower TER (0.12%) than IWDA (0.20%)
- However, SWRD has a larger bid-ask spread (4.5c) vs. IWDA (2.0c)
- At time of writing, the larger spread results in additional cost of 0.18% at time of purchase and subsequent sale (difference between purchase of 43 IWDA x 2.0c vs. 118 SWRD x 4.5c, divided by investment amount of US$2,500)

Purchasing SWRD results in 0.18% higher costs during purchase and sale, but the lower TER (savings of 0.08% p.a.) results in a breakeven if I were to hold for 2+ years. Investment horizon is currently for the next 30 years at the very least.

Granted there are many other factors such as fund size, constant bid-ask spreads, constant TER, would you say that SWRD may be superior to IWDA for this case?

Thanks for the patience with the long questions!

 

[Krisar]

Received an email from MBKE that there will be fees effective 1 August for corporate action/CDP sub account maintenance. These are new right? Guess it’s time to close the prefunded account for good (opened for MIP but was discontinued).

 

[Ilovemathstutor]

Should I drop my CI rider $75k out from my term plan to 99?
Also, wouldn’t there be out of pocket payment for hospitalisation plan like pay 5% or 10% ?

A Term Plan to 99 is going to be awfully expensive and if u are considering that, you might want to consider a Life Plan instead.

Why is that?

A Term Plan is optimal if u are getting the McNormal ones to 65 years old. Once it crosses 65 yrs old and stretches to 99, I would point u towards Life Plan instead.

Pls note, CI Rider means you only get paid after you are at the late stage of the CI, by then... trust me, life is quite meaningless to most with chemo or whatever freaking painful treatment.

Early CI Rider are freaking expensive and most won't be able to afford a huge amount of it. And yes, if u get CI... you need 1m and above to pay for it.

Just get the most pimped hospitalisation and case close it.

The insurance agent is just trying to scare you with misinformation and withholding of critical information.

All you need is a pimped out hospitalisation plan, get the most expensive ones in the market. Usually, that means AIA.

AIA has consistently shown that they flip-flop the least. Yes, even AIA has flip-flopped on their warranties of contract.

Don't play into their game of FUD.

Deductibles and Co-Insurance are a fact of life, Gov has realised they open a can of worms when they allowed insurance companies to sell all-expenses paid hospitalisation plans. This allowed the doctors to charge at an all-you-can rate, raising the costs of medical bills in general of the entire SG population. This has since been stopped.

Only AIA honour it, the rest flip-flopped away... including Great Eastern, the 2nd most expensive hospitalisation plan.

 

[Shiny Things]

Hello, what do you invest with your SRS funds...anyone care to share? Is it worth to buy insurance plans (those with annual payouts) or is it better to buy ETFs?

This deserves a non-facetious answer, and the answer is that ETFs are better.

You’re saving for retirement, and for most of us that’s going to be a horizon of twenty or thirty years, or even more. Over that time, it’s easy to ride out the swings and roundabouts of equity markets; and the tradeoff for the higher volatility of equities is that they have higher returns than you could get from a boring insurance policy.

Just for info, NIKKO AM is changing the board size for A35, MBH and G3B to 10 instead of current 100.

wef from 19 Aug.

Any reasons for doing so; to increase liquidity or reduce bid ask spread?

Really they should cut the lot size to 1. It’s no more complicated for the exchange’s computers to process a 1-share trade than it is to process a 10-share trade.

Hello Shiny, I'm a little confused by this. Am employing a similar strategy of buying IWDA 4 to 5 months a year. I've done some calculations in an excel and it seems that paying the elephant USD/SGD spread of 90pips per way is still cheaper than employing IBKR.

Resulting fees are ~US$10.70 (x4) per trading month for SC, and US$10.00 (x12) for IBKR regardless of trading activity.

Hmm - don’t forget the FX spread on the Stanchart trades. You’ve got the fees right, but the Stanchart side is going to have some extra hidden costs from FX that won’t be reflected in the fees.

On a side note, would you recommend purchasing SWRD over IWDA?

Granted there are many other factors such as fund size, constant bid-ask spreads, constant TER, would you say that SWRD may be superior to IWDA for this case?

Thanks for the patience with the long questions!

Not a prob at all! These longer questions are always the interesting ones.

I agree the lower expense ratio on SWRD makes it more appealing, your math is right on the money there. The fund size is a little smaller than I’d like, though, and it is quite new. If it had a bit more history I’d feel a lot better about it.

Received an email from MBKE that there will be fees effective 1 August for corporate action/CDP sub account maintenance. These are new right? Guess it’s time to close the prefunded account for good (opened for MIP but was discontinued).

Ugh, yeah. It’s a shame that MBKE have trashed their product offering like this.

A Term Plan to 99 is going to be awfully expensive and if u are considering that,

… I’d even say that if you’re considering a term-to-99 plan you’re missing the point of insurance.

Term-to-65 makes sense if you have, for example, kids’ college expenses or mortgage expenses that you’d need to fund if you got hit by a bus. The point of term life there is that if you get hit by the proverbial bus, the term life policy will cover your kids’ and your family’s costs until the kids are old enough to support themselves.

But once you turn 65, your kids have moved out and everyone should be able to support themselves. You don’t need life insurance after that point, because you can fund yourself by selling down the stocks and bonds that you’ve bought over the previous 40 years.

Whole-life is a waste; term-to-99 is basically the same as whole-life, and it’s a waste as well.

 

[funnywits]

Received an email from MBKE that there will be fees effective 1 August for corporate action/CDP sub account maintenance. These are new right? Guess it’s time to close the prefunded account for good (opened for MIP but was discontinued).

What are the options now? We should close account and sell shares or move the shares somewhere else? Which is a better option?

 

[tangent314]

Hello Shiny, I'm a little confused by this. Am employing a similar strategy of buying IWDA 4 to 5 months a year. I've done some calculations in an excel and it seems that paying the elephant USD/SGD spread of 90pips per way is still cheaper than employing IBKR.

Working assumptions:
- Non-SC Priority
- Less than US$100k in IBKR

Resulting fees are ~US$10.70 (x4) per trading month for SC, and US$10.00 (x12) for IBKR regardless of trading activity.

Would like to seek clarification if I'm interpreting this wrongly somewhere.

You are missing the FX conversion which is about 0.5% one way. If you intend to have the units remain in SC all the way until you sell, you will have to count both ways.

If you are investing $1200 every 4-5 months into IWDA, then SCB may be better. If you are buffering up $1200 per month to invest every 4-5 months into IWDA, then IBKR will be better.

The rule of thumb is to estimate whether you can reach US$100k value (inclusive of capital gain) in less than 7-8 years.