SRS Portfolio

[Kojo0403]

S27 is the symbol for SPY when traded on the SGX. It is actually one in the same, just a cross listing. So when you buy S27 you are actually buying SPY.

If you buy S27 in your SRS, estate tax won’t apply because your SRS operator manages the investments through a foreign intermediary, in the case of UOB this is UOB Nominees.

The 30% withholding tax on dividends does apply. Currently the dividend rate is 1.24% per annum x 30%, so about 1/3 of a percent is lost each year. But, given the low expense ratio of less than 1/10 of one percent, you are still under 1/2 of one percent in total which is hands down better than any other SRS eligible investment in US equities.

Note as well that it is possible to eventually withdraw the shares by in-kind transfer to CDP and then cross-border transfer to IBKR and sell as SPY shares in the US, so you won’t have to deal with the poor spreads, high commissions or lousy exchange rates except at the start.

I have made four purchases of S27 in my SRS so far and roughly it’s been about 1/3, 1/3, 1/3 for spread, currency & commissions/fees, or about 1% upfront cost. Well worth it in my opinion, given it’s a long-term investment, especially if I can liquidate more efficiently in the end.

thanks for the detailed analysis.
indeed it’s the most cost efficient option for S&P 500 among the other available options

 

[Nesplex]

S27 is the symbol for SPY when traded on the SGX. It is actually one in the same, just a cross listing. So when you buy S27 you are actually buying SPY.

If you buy S27 in your SRS, estate tax won’t apply because your SRS operator manages the investments through a foreign intermediary, in the case of UOB this is UOB Nominees.

The 30% withholding tax on dividends does apply. Currently the dividend rate is 1.24% per annum x 30%, so about 1/3 of a percent is lost each year. But, given the low expense ratio of less than 1/10 of one percent, you are still under 1/2 of one percent in total which is hands down better than any other SRS eligible investment in US equities.

Note as well that it is possible to eventually withdraw the shares by in-kind transfer to CDP and then cross-border transfer to IBKR and sell as SPY shares in the US, so you won’t have to deal with the poor spreads, high commissions or lousy exchange rates except at the start.

I have made four purchases of S27 in my SRS so far and roughly it’s been about 1/3, 1/3, 1/3 for spread, currency & commissions/fees, or about 1% upfront cost. Well worth it in my opinion, given it’s a long-term investment, especially if I can liquidate more efficiently in the end.

If I want to invest my SRS money in a fund which tracks the S&P 500 index, is buying of S27 directly through SGX considered to be the most cost-efficient method at the moment? As compared to buying the unit trust "LionGlobal Infinity U.S Stock Index Fund" from the bank (e.g. OCBC) or through robo-advisors like Endowus? Thank you for any advice from those who are familiar with how the fees for the different methods work.

 

[karakorum1999]

Yeah, i got this and the s&p 500. Good!

Did you invest in LGI global and LGI US 500 around the same time?
From your experience, having both is good (in terms of returns so far, diversification etc.)?

 

[yuzu28]

Did you invest in LGI global and LGI US 500 around the same time?
From your experience, having both is good (in terms of returns so far, diversification etc.)?

Yes, DCA + lumpsum cash & SRS in both LGI, 0% sales charge. So far i think my S&P is > 10% growth. Global i think is 7% to 8%. S&P is pure USA. Global is a mix with other regions but also heavy in USA. I just get both.

Some forumers will say UTs have high expense ratio, buying ETFs are better if using cash. I collect both.

 

[karakorum1999]

Yes, DCA + lumpsum cash & SRS in both LGI, 0% sales charge. So far i think my S&P is > 10% growth. Global i think is 7% to 8%. S&P is pure USA. Global is a mix with other regions but also heavy in USA. I just get both.

Some forumers will say UTs have high expense ratio, buying ETFs are better if using cash. I collect both.

Thanks.
Have always thought about using some of my SRS for these LGI, but never got around to it (me no 0% platform like poems or dollardex yet).
Recently Endowus fund smart fee dropped to 0.3% for single fund, so I could use this route (just 0.03% higher fees than poems/dollardex after trailer fee rebate).

 

[yuzu28]

Thanks.
Have always thought about using some of my SRS for these LGI, but never got around to it (me no 0% platform like poems or dollardex yet).
Recently Endowus fund smart fee dropped to 0.3% for single fund, so I could use this route (just 0.03% higher fees than poems/dollardex after trailer fee rebate).

Didn't explore endowus further. Cos the returns for robo not really good. I use poems to dca quite a fair bit of ut. U can do dca using srs, 15300/12.

I'm not particular about expense ratio as long as returns is > 4%. But what others commented about expense ratio is true too

 

[celtosaxon]

If I want to invest my SRS money in a fund which tracks the S&P 500 index, is buying of S27 directly through SGX considered to be the most cost-efficient method at the moment? As compared to buying the unit trust "LionGlobal Infinity U.S Stock Index Fund" from the bank (e.g. OCBC) or through robo-advisors like Endowus? Thank you for any advice from those who are familiar with how the fees for the different methods work.

Yes, S27 is the lowest cost way to invest your SRS in the S&P 500. The expense ratio is 0.095% and the withholding tax on dividends amounts to 1.24% x 30%. Add those two together and it’s less than half a percent drag on the S&P 500 total return.

Lion Global Infinity US 500 has a total expense ratio of 0.67% and pays the Ireland withholding tax on dividends of 1.24% x 15%. Just adding these two up it’s nearly double the cost of S27. Then, depending which platform, you may have to pay a platform fee, like FSM charges 0.35% per year for normal clients to invest SRS in this unit trust. Add it all up, the total could easily be 1.2% per year, then compound that over all the years you will have SRS!

 

[$ingaporean]

Is there a world index etf we can buy in singapore?

 

[celtosaxon]

Is there a world index etf we can buy in singapore?

Nope. Pack your bags for London my friend… ask for ISAC.

 

[RedsYWNA]

Is there a world index etf we can buy in singapore?

There's a world index unit trust that you can buy via SRS or CPF OA i think........ Infinity Global Stock Index Fund.

For cash, I think the sky's the limit. No need to restrict yourself to SG buys.

 

[celtosaxon]

That’s why… don’t go and buy Infinity Global Stock Index Fund in your SRS and then buy SGX listings with cash.

Buy your SGX listings with your SRS and then buy ISAC in London with cash!

 

[skpuppy]

That’s why… don’t go and buy Infinity Global Stock Index Fund in your SRS and then buy SGX listings with cash.

Buy your SGX listings with your SRS and then buy ISAC in London with cash!

I buy infinity global stock index with SRS and use cash to whack US and China. Lol! Why whack SG?

 

[celtosaxon]

I buy infinity global stock index with SRS and use cash to whack US and China. Lol! Why whack SG?

Bo pien hor. SRS is limited to investment vehicles available in SG. So, if you want to invest SRS in foreign equity it’s either UT or ETF traded on SGX.

Personally, I don’t think UT sold here provide good value to investors because of the high sales charges, platform fees and annual expense ratios.

Lion Global is one of the lowest cost because they do nothing other than repackage cheap overseas funds and make them available locally. Of course, they add a nice juicy fee for themselves in the process.

ETFs traded on SGX are usually where you find the best value for SRS investments.

 

[skpuppy]

Bo pien hor. SRS is limited to investment vehicles available in SG. So, if you want to invest SRS in foreign equity it’s either UT or ETF traded on SGX.

Personally, I don’t think UT sold here provide good value to investors because of the high sales charges, platform fees and annual expense ratios.

Lion Global is one of the lowest cost because they do nothing other than repackage cheap overseas funds and make them available locally. Of course, they add a nice juicy fee for themselves in the process.

ETFs traded on SGX are usually where you find the best value for SRS investments.

Good point. Personally i think we have to look at the overall returns. Some possibilities:

(1) if you leave money in SRS, you get 0.05%
(2) if you invest in STI etf, 5 years annualised returns = 5.41, expense ratio = 0.3%
(3) if you invest in infinity global fund, 5 years return = 12.7%, expense ratio = 0.76%
(4) if you invest in FSSA dividend advantage, 5 years return = 12.2%, management fees = 1.5%
(5) S27 SPDR S&P500 etf, 5 years return = 17.48%, management fees = 0.095%

I think only S27 is worthwhile in STI. If you’re invest in STI ETF, you will be worst off as compared to unit trust. Again I agree those infinity etc are greedy F who repackaged yet charge high cost. Well, LL suck thumb lo. Better than u invest in ES3 then earn peanuts

 

[$ingaporean]

Good point. Personally i think we have to look at the overall returns. Some possibilities:

(1) if you leave money in SRS, you get 0.05%
(2) if you invest in STI etf, 5 years annualised returns = 5.41, expense ratio = 0.3%
(3) if you invest in infinity global fund, 5 years return = 12.7%, expense ratio = 0.76%
(4) if you invest in FSSA dividend advantage, 5 years return = 12.2%, management fees = 1.5%
(5) S27 SPDR S&P500 etf, 5 years return = 17.48%, management fees = 0.095%

I think only S27 is worthwhile in STI. If you’re invest in STI ETF, you will be worst off as compared to unit trust. Again I agree those infinity etc are greedy F who repackaged yet charge high cost. Well, LL suck thumb lo. Better than u invest in ES3 then earn peanuts

I feel that we should not discount unit trust. Using the example is s27, are we able to find alternatives in the unit trust universe? I think we do.

For example, Franklin Templeton us opportunities fund has consistently outperformed s27 with exception of some years. It has 2 reference index, the snp and Russell. Russell index typically has a higher return than snp because it could be riskier. Although it is not comparing apples to apples, whats important is that we can extract more returns over time using than a vanilla index fund.

 

[skpuppy]

I feel that we should not discount unit trust. Using the example is s27, are we able to find alternatives in the unit trust universe? I think we do.

For example, Franklin Templeton us opportunities fund has consistently outperformed s27 with exception of some years. It has 2 reference index, the snp and Russell. Russell index typically has a higher return than snp because it could be riskier. Although it is not comparing apples to apples, whats important is that we can extract more returns over time using than a vanilla index fund.

Totally agree. I think there are maybe 5% of the unit trust which does better than the index. United global quality fund is one of them. But the expense ratio much higher than those funds that tracks index.

 

[$ingaporean]

Totally agree. I think there are maybe 5% of the unit trust which does better than the index. United global quality fund is one of them. But the expense ratio much higher than those funds that tracks index.

Because they are active funds, they incur additional cost like fund manager, analyst etc. But if these additional cost result in even higher value to unit holder then I think they are justified.

 

[skpuppy]

Because they are active funds, they incur additional cost like fund manager, analyst etc. But if these additional cost result in even higher value to unit holder then I think they are justified.

Now US is on steroids. Not sure whether this will continue for next 10, 20 or 30 years

 

[chrisloh65]

Now US is on steroids. Not sure whether this will continue for next 10, 20 or 30 years

With US FEd rate at 0% and USD being printed like no tomorrow and no better than toilet papers, not surprising to see US stocks and properties prices on steroid! Imagine USD in circulation increased by 5x from massive USD printing, why won't US stocks and properties prices rise?
But I am sure that 0% US Fed rate and USD massive printing can never save the collapse of the over-priced super bubblish stage of US stock market! Time will tell!

 

[Jirachi]

I believe most people are not in First Sentier funds due to its high expense ratio?