With the current USO turmoil, can someone "recommend" which oil ETF to buy for the long haul in anticipation of higher prices with regards to contango/backwardation, withholding tax, expense ratios, etc... and which broker? I have in mind USL or DBO but am wary of their liquidity and volumes traded so am open to others. Hope all great minds unite and trash it out.
I answered this over in the oil-trading thread where I've spent the last week explaining to some dude that USO does not work the way he thinks it does. He's lost 45% of his money in a week. It's going about as well as you'd expect.
Firstly, nobody in this thread should do this (except for the one or two people in this thread who I know trade energy professionally, you can ignore this). Neither you nor I have any idea about where oil is going, and if you try, you will almost certainly end up losing money.
But, to repeat what I said over in the other thread:
Don't *clap emoji* buy *clap emoji* commodity *clap emoji* futures *clap emoji* ETFs *clap emoji*.
If you want to get long oil "for the long term", with minimum exposure to rolldown, minimum tax, minimum expense ratios, buy the futures.
Dec22 CL is 4 cents wide right now, and you can trade it at IBKR to your heart's content for 85 cents per contract per side, with zero withholding tax, zero cap gains tax, zero roll cost, zero expense ratio.
You replied:
Thanks but no futures for me as its leveraged. I want to sleep peacefully so I am willing to pay full sum for ETFs. Am looking for best fit ETF and broker cost wise as far as possible.
And I responded:
You know what; I always have recommendations in these cases, but in this particular case—you want exposure to oil but you're not prepared to use futures—I think you should not do this. There is no good answer; there are only bad answers and worse answers.
But what i dont understand is that does this also apply when we want to see our current balance? If we use last price here, then how does the average price of share come into the picture in DCA here if we were to sell shares?
It... doesn't. I genuinely don't understand the question.
For long-term investors, the purchase price doesn't matter. All that matters is the current price of the shares.
How is RSP a hassle? It's literally the most convenient thing; you just leave it there and it auto buys for you. Takes the temptation to time the market away too.
Yeah, exactly this! I really wish there was a good Singaporean robo-advisor that would RSP into a nice simple three-fund portfolio for you. I've said this over and over and over again, but if anyone from any of the Singaporean brokers is watching, I'd love to help you build this.
Hi shiny,
I started work last year and currently have around 5k in stashaway with maximum risk allocation. 85% in US 15% in EU. Started with robo because I have no clue about investing. I am also DCA-ing 100/month into STI on Fsmone.
What should I put into if I have 500 to DCA monthly?
1) I'd pull your money from Stashaway. It's not that they're bad, it's just not a particularly relevant investment for Singaporean investors.
2) You can do really well by just DCA-ing into the STI ETF and MBH (corp bond ETF) through FSMOne, and buying some IWDA as well to give yourself some exposure to global markets.
