Official Shiny Things thread—Part III

[swan02]

What he meant was if it is needed as in the position of me and especially if the dividends from eg nasdaq etfs are so small that an extra 15 percent for USA domiciled is still warranted should I value the sipc insurance a lot plus also there are etfs only available in USA domiciled such as vanguard small caps value VBR. U can’t find that in LSE. The best u get is small caps world .

So VBR is the investment decision and that should also be a priority.

Hmm say for voo and vusd
Both track the same index and have same performance. Then choosing vusd is better right? Because of the WHT... Although its liquidity is lower and expense ratio higher

So I think it depends on if there r alternatives

 

[swan02]

I’m not an expert in insurance but I’m quite certain that our minimal medishield life is adequate and that sticks to u forever.

I’ve seen many lupus and even the most severe ends up in icu and that’s taken care of. The financial situation is similar to a retiree facing sequence of returns risks !

Your friend is in an uncertain precarious position. If I were her and i might be wrong ..

1. Work hard save hard and invest hard n take care to be safe.
2. The only time u do not need much insurance is when u have a lot of money. So best to get there quickly or early retirement financial position.

3. Therefore it’s a catch 22 problem and I would choose to continue invest and I really think a conservative to moderate risk all weather portfolio will suit her best.

Ie start with 25 percent equity , 12 percent gold, 13 percent idtl. 10 percent sgd cash or short term bonds and 40 percent in A35 mix with mbh. Worst year -3 percent, max drawdown -10 percent . Sharpe 0.66. STD 6.35 % CAGR 8.8%

In time if financial situation improves, equity can be increased until the max 40%, gold increase to 20, idtl to 20 and cash remains 20. This is the golden butterfly.

And rebalance yearly or whenever money is taken out of portfolio after emergency fund is used up.

And also keep a 6 month emergency fund and no need more because the all weather is designed for sequence of risk returns events especially in high shillers cape environment. Consistency is key.

However if she has not much capital to start with for eg little money and can only invest 2k a month, then it’s obvious she needs to take more risk. start with golden butterfly, or 60 percent equity, 20 percent Gold and 20 percent idtl.

Or a simple route 30/70 conservative. 30 percent equity/70 percent A35. If u want more return, u just switch A35 to MBH.

How should someone without any insurances (due to pre-existing illness) invest?

it?

 

[hellvolhardzelinsky]

I’m not an expert in insurance but I’m quite certain that our minimal medishield life is adequate and that sticks to u forever.

I’ve seen many lupus and even the most severe ends up in icu and that’s taken care of. The financial situation is similar to a retiree facing sequence of returns risks !

Your friend is in an uncertain precarious position. If I were her and i might be wrong ..

1. Work hard save hard and invest hard n take care to be safe.
2. The only time u do not need much insurance is when u have a lot of money. So best to get there quickly or early retirement financial position.

3. Therefore it’s a catch 22 problem and I would choose to continue invest and I really think a conservative to moderate risk all weather portfolio will suit her best.

Ie start with 25 percent equity , 12 percent gold, 13 percent idtl. 10 percent sgd cash or short term bonds and 40 percent in A35 mix with mbh. Worst year -3 percent, max drawdown -10 percent . Sharpe 0.66. STD 6.35 % CAGR 8.8%

In time if financial situation improves, equity can be increased until the max 40%, gold increase to 20, idtl to 20 and cash remains 20. This is the golden butterfly.

And rebalance yearly or whenever money is taken out of portfolio after emergency fund is used up.

And also keep a 6 month emergency fund and no need more because the all weather is designed for sequence of risk returns events especially in high shillers cape environment. Consistency is key.

However if she has not much capital to start with for eg little money and can only invest 2k a month, then it’s obvious she needs to take more risk. start with golden butterfly, or 60 percent equity, 20 percent Gold and 20 percent idtl.

Thanks. Currently she's going 60-20-20 IWDA-STI-MBH if I'm not wrong.
Becuase shiny things book is not written for her situation so I don't think she should follow the formula.

Hopefully more people can give advice and opinions on this. Thanks again!

 

[swan02]

Better info for us would be her financial status, job, age, saver ? Risk appetite ?.......beautiful or not ie higher chance of getting married to a hopefully richer husband and that changes everything.

Or even maybe u r a potential suitor ? u can perhaps tell us everything since no one knows. right ?

Thanks. Currently she's going 60-20-20 IWDA-STI-MBH if I'm not wrong.
Becuase shiny things book is not written for her situation so I don't think she should follow the formula.

Hopefully more people can give advice and opinions on this. Thanks again!

 

[believeinyourself]

I know you addressed your question to ST, but I think I have an answer: I don’t think you can, or at least it’s very hard. U.S. brokers and mutual fund providers don’t seem to want to market U.S. mutual funds to non-U.S. persons. I don’t think there’s any regulatory barrier, but it seems to be something of an industry practice. I think you have to wait until your U.S. personhood is in place before you can do this.

When that time comes, I want to recommend Schwab’s target date index mutual funds in this role due to their lower expense ratios. Just look for the target date index fund with the year that most closely matches your planned (and realistic) retirement year. You can buy that fund directly with as little as US$1 to start and US$1 increments.


Nope.

As an aside, as I was digging into this, I see that Interactive Brokers has many Vanguard Ireland mutual funds listed in their No Transaction Fee mutual fund program. This could be really interesting for non-U.S. persons! I’ll do some more checking to see if there are some gems to be found. Do we have an even lower cost alternative to VWRA and IWDA without any whole share complications? Maybe, maybe not. “Stay tuned.”

Looking forward to your update! Would be great if we can get into the Ireland-domiciled mutual funds by Vanguard via IBKR.

 

[Hopeful33]

Hi all, I have seen comments in other threads about sti being dead over the past decade and many prefer to invest in global stocks instead. If that’s the case, if we are buying ES3 now, will it be possible to run into a scenario many years later that when we want to sell off our ES3, there could be no buyers and it will be hard to get back the cash we invested in ES3?

Thanks for any response given.

 

[celtosaxon]

Hmm say for voo and vusd
Both track the same index and have same performance. Then choosing vusd is better right? Because of the WHT... Although its liquidity is lower and expense ratio higher

So I think it depends on if there r alternatives

Agree, for the same investment decision like VOO vs VUSD (both S&P500 Index), one should seek the best alternative.

My point was that the 30% withholding tax on dividends should not be driving a different investment decision, just to avoid that tax. For example, choosing Berkshire shares just because they pay no dividends. The reason being, investment performance between different investment decisions almost always has a much greater impact on returns than the withholding tax.

 

[BBCWatcher]

Looking forward to your update! Would be great if we can get into the Ireland-domiciled mutual funds by Vanguard via IBKR.

A provisional update: probably not. There are US$1 million minimums for the funds I’ve been looking at so far. I’ll keep looking.

 

[zoneguard]

If that’s the case, if we are buying ES3 now, will it be possible to run into a scenario many years later that when we want to sell off our ES3, there could be no buyers and it will be hard to get back the cash we invested in ES3?

Market makers' job to ensure liquidity and availability of bid/ask.
https://api2.sgx.com/sites/default/files/2018-11/SGX ETF Investor Guide (Nov 2018).pdf

If needed, Participating Dealer creates/redeems units with underlying STI constituents.

 

[celtosaxon]

What he meant was if it is needed as in the position of me and especially if the dividends from eg nasdaq etfs are so small that an extra 15 percent for USA domiciled is still warranted should I value the sipc insurance a lot plus also there are etfs only available in USA domiciled such as vanguard small caps value VBR. U can’t find that in LSE. The best u get is small caps world .

So VBR is the investment decision and that should also be a priority.

London has ticker USSC.

As a non-US investor, withholding tax is a minor concern compared to the whopping 40% estate tax your heirs could pay if you held a sizable positions in an ETFs like VOO or VBR at the time of your passing.

There is only a $60,000 estate tax exemption for non-US persons on US based investments. Therefore, where you have alternatives like VUSD and USSC on the London Exchange, you should take advantage of that - even if you might pay a little more on the spread due to lower liquidity. That way you can reserve your $60,000 exemption for US investments where you have no other alternatives.

 

[Armwrestler]

Hi shinythings , bbc and all,

g3b 2020 dividend yield 4.93% compared to 4.67% in 2019,

es3 is always touted as the better fund but its dividend yield in 2020 is 4.46% compared to 2019's 4.65.

Does this mean g3b more stable and better dividend, or what gives? Please enlighten me, someone.

Or, in what ways is es3 better??

 

[zoneguard]

Does this mean g3b more stable and better dividend, or what gives? Please enlighten me, someone.

Or, in what ways is es3 better??

1. Fund size. 1100 mil vs 345 mil.
2. Tracking error: 0.15% vs 0.17%.

BTW this is the 1st year ES3's dividend yield is lower than G3B's for the past 5 years. It happened in 2015 as well. Please also read
https://forums.hardwarezone.com.sg/128905517-post1073.html

 

[swan02]

Thanks for the USSC recommendation.

My issue is I do place some importance in the SIPC insurance but that limit is 500k usd for my joint LLC and even with multiple accounts which I can open personal x1 and wife x1 is only 150k sgd insurance for the IB
Sg. So regret closing my LLC personal. I will exceed the amount.

So I was surprised TD Sg is SIPC because IB sg is if not mistaken only SDIC. So that’s why I’m looking at TD and I’m fully aware of the 60kusd threshold. Hence I can have x2
Accounts. atleast gldm etf I can buy
USA domiciled.

1. So how do people increase SIPC insurance with IB ?

2. I’m also buying Sg reits so I won’t be over the limit in IB sipc. Ie keeping more Sg equities.

3. 0.5 percent TD spread is really ex.

Just thinking of alternatives to a problem.

London has ticker USSC.

As a non-US investor, withholding tax is a minor concern compared to the whopping 40% estate tax your heirs could pay if you held a sizable positions in an ETFs like VOO or VBR at the time of your passing.

There is only a $60,000 estate tax exemption for non-US persons on US based investments. Therefore, where you have alternatives like VUSD and USSC on the London Exchange, you should take advantage of that - even if you might pay a little more on the spread due to lower liquidity. That way you can reserve your $60,000 exemption for US investments where you have no other alternatives.

 

[celtosaxon]

Thanks for the USSC recommendation.

My issue is I do place some importance in the SIPC insurance but that limit is 500k usd for my joint LLC and even with multiple accounts which I can open personal x1 and wife x1 is only 150k sgd insurance for the IB
Sg. So regret closing my LLC personal. I will exceed the amount.

I would be surprised if IBKR (regardless of SG or LLC account) did not cover US shareholdings under SIPC. You might want to check with them to confirm.

1. So how do people increase SIPC insurance with IB ?

AFAIK you can’t, but the broker can (and often does) have additional insurance on top of SIPC. This is at the broker’s discretion, you can’t increase it individually per account.

3. 0.5 percent TD spread is really ex.

0.5% is worst case. It is hard to know exactly because the timing of receiving funds into the account versus the time of the exchange... but as best I can tell it was in the 0.25-0.5% range. That is only going to seem expensive to those trading forex directly in IB, for everyone else... it’s not bad!

If you are moving US shares from IB to TD there is no exchange, it’s a direct ACAT transfer.

 

[BBCWatcher]

I've still been looking into the No Transaction Fee mutual fund list at Interactive Brokers to see if there are any viable, low cost mutual funds that'd be broadly useful to long-term investors living in Singapore who are not U.S. persons. And I've been looking specifically at the Vanguard funds that are on IB's NTF list.

I'm still not finding great options, but I encourage others to keep digging and looking at both Vanguard and non-Vanguard funds. I looked at Vanguard's "Target Retirement" funds, for example, and there are some that appear in IB's list. However, unfortunately those particular funds are U.K. domiciled and designed for those planning to retire in the United Kingdom specifically. (They overweight some U.K.-oriented subfunds.) Also, U.K. Inheritance Tax (which is actually an estate tax) applies once your total holdings reach a certain level.

 

[ComTruise]

Hi Shiny Things!

Bought your book 3 years ago, and realised I've been buying IWDA from AMS via SC for years using EUR currency, instead of via LSE using USD.

I've recently realised from the forum threads that I'm supposed to be doing the latter. Should I be concerned and if so, what should I do?

Hope to hear from you.

Thanks!

 

[Johnpierpontmorgan]

Expert investor Seth Klarman says US stocks terribly over-priced and being artificially propped up by US Fed!

https://www.marketwatch.com/story/the-fed-treats-investors-like-foolish-children-by-propping-up-stocks-despite-dreadful-fundamentals-hedge-fund-heavy-seth-klarman-says-2020-07-30?mod=mw_more_headlines

"The Fed treats investors like ‘foolish children’ by propping up stocks despite ‘dreadful fundamentals,’ hedge-fund heavy Seth Klarman says
Published: Aug. 1, 2020
By Shawn Langlois
"

dont post this here. The mantra is just keep buying iwda / vwra and mbh and a35 and some cash


Dollar will perpetually be king

America Has won the tech wars. Fkin yellow skin and asia weak man forever sug amdk cok
Tok tok operations get forced to sell pennies on dollars to Microsoft or just get the fug out. Nobody in the west protest that this is not rule of law

Huawei also another gone case. Japan ban them, uk ban them, Aus ban them. Asian forever be amdk chauffeur, is really a joke

America number 1. China is losing every tech war I see and the dollar is highly likely gonna reign supreme for another century with no possible contender in sight

Long live the dollar and long live the fed printing press. I don’t see the dollar role being diminished since China is losing every battle, tech war, capital war, trade war.

Even Taiwan and hk also despise their own ancestors from mainland. The sinkie pwn sinkie mentality is because we have chinese blood

 

[megdang]

Hi Shiny Things!

Bought your book 3 years ago, and realised I've been buying IWDA from AMS via SC for years using EUR currency, instead of via LSE using USD.

I've recently realised from the forum threads that I'm supposed to be doing the latter. Should I be concerned and if so, what should I do?

Hope to hear from you.

Thanks!

Wah, how come you don't know you are buying EUR one? You didn't notice the exchange rate?

 

[Johnpierpontmorgan]

According to below expert economist, he forecast that USD will have 35% decline from Jun 2020 rate. I would bet my money with his bearish expert forecast than your forever "bulls" about USD and US stocks (anyway we know very well that propagating such view will benefits you).

https://www.bloomberg.com/opinion/articles/2020-06-14/dollar-crash-how-will-it-unfold

"How the Coming Crash in the Dollar Will Unfold
The argument that there is no alternative to the U.S. currency makes little sense.

By Stephen Roach
June 15, 2020

My forecast that a 35% decline in the value of dollar could well be in the offing is couched in terms of the comparison between the U.S. and the currencies of a broad basket of America’s trading partners.
"

Fkin dumb dumb


Usd is forever king and Role for its reserve currency status is rock solid now seeing that China has lost every battle

Trade war- America 1: China 0
Tech war- America 99: China 0
Capital war- America 999: China 0

Don’t be surprised if America renege on its treasury payments to China and nobody on the international platform will make any noise. They might say China owe america back 10 trillion because of the covid damages

And India plus Australia will be next in line to force China to compensate.
Japan aus and India those arseholes can force China to become third world in no time
What those US allies dont understand is that after they pummel China into wasteland, they will be targeted next by America.

Long live the dollar and the fed printing press.

 

[limster]

Wah, how come you don't know you are buying
EUR one? You didn't notice the exchange rate?

Anyway, if he has been buying IWDA for years he will be in the green, whatever the currency. DCA into the wrong currency is still better than hiding cash in milo tin!

And I'm pretty sure his IWDA in EUR will outperform the portfolios of many of our local bloggers who are 100% vested in Singapore.