[Singapore] 40yo New Investor

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Topic Author
oken
Posts: 2
Joined: Thu Oct 10, 2019 7:00 pm

[Singapore] 40yo New Investor

Post by oken » Fri Oct 11, 2019 12:56 am

Hi all,

I'm a 40yo Singaporean who is late to the investing game.
Have only recently (few mths back) started reading up and planning to invest, and came across this forum. Hopefully can gain some insights and advice from those who have been investing far longer than I have.

I have opened up a brokerage account, started some small sums with Robos (Stashaway) and Peer2Peer (Funding Societies), but am waiting on the main bulk of my money as I'm not sure if now is the best time to go into the market. (Everyone seems to be talking about an impending crash in potentially 2 years or less? Drop of 20-40%? Why not wait until it happens before I start?)

Let me first state an assumption I am making about Bonds as part of Portfolio.
My understanding is that Bonds are there as a safety measure so that even if your equities tank, you at least have some measure of funds that will remain and even appreciate.
Assumption: I don't think I need Bonds, because I have a relatively solid CPF account that is just sitting there earning 4% (most of my CPF is in SA.)

My original intention was to open up a SRS account (tax relief), and invest from that account.
The initial idea was to just park everything with a Robo (probably Stashaway) and Dollar-Cost Average it and (hopefully) forget it exists until its time for me to take it out. =p
However, as I read up more, I am presented with more choices, and there is a certain amount of paralysis by analysis. Hhahaha...

So now, am considering 3 possibilities.
A) Stashaway. High risk. Mostly ETF Equities portfolio.
B) MoneyOwl. High risk. Low Cap Dimensional Funds. (I like the idea of value stocks, but not sure how this would do VS Stashaway...)
C) Self-Service. Buy a single Global Ireland Domiciled ETF through my broker.

The Robos provide me with a certain amount of assurance in the sense that they are automatic and I can just forget about them.
As a new investor, I'm concerned that I may not be as disciplined if left to my own devices.
In addition, I'm not sure how much I'll be spending in transaction fees if I buy ETFs on my own, so will need to work that out as well.

Any thoughts from the gurus please? Would love to hear opinions from those who have walked the path before...

Many thanks in advance.

DJN
Posts: 509
Joined: Mon Nov 20, 2017 12:30 am

Re: [Singapore] 40yo New Investor

Post by DJN » Fri Oct 11, 2019 5:33 am

hi,
good start.
I am not sure why you consider a robo-adviser high risk? What is the total cost ratio for using one? Using a robo-adviser is one way to start your investment journey while you learn more. As long as the costs are low.
Read here for a good introduction for non-US investors to the main issues that you will generally encounter: https://www.bogleheads.org/wiki/Outline ... _domiciles
DJN
Yah shure

Topic Author
oken
Posts: 2
Joined: Thu Oct 10, 2019 7:00 pm

Re: [Singapore] 40yo New Investor

Post by oken » Fri Oct 11, 2019 6:16 am

DJN wrote:
Fri Oct 11, 2019 5:33 am
hi,
good start.
I am not sure why you consider a robo-adviser high risk? What is the total cost ratio for using one? Using a robo-adviser is one way to start your investment journey while you learn more. As long as the costs are low.
Read here for a good introduction for non-US investors to the main issues that you will generally encounter: https://www.bogleheads.org/wiki/Outline ... _domiciles
DJN
Thanks for the encouragement!
I think I may have used a misleading term when I said 'high risk'. Robos typically have a suite of portfolios to choose from and I meant that I intend to choose the portfolio of highest risk. Typically 80-100% equities.

Maybe some questions
1) Any thoughts on my decision to wait the downturn before investing? I understand conventional wisdom is to start as soon as possible but I can't get over the thought that I might lose 20% in a couple of months. =/

2) Any thoughts on whether Robos or a single global ETF might be a better idea? Or perhaps the right question ought to be, "Under what conditions would one choice be better than the other?"

3) If Robos are a possible choice, any thoughts on one which buys a basket of ETFs vs one that buys low cap Dimensional Funds (supposedly 'value' stocks)? I'm inclined towards value stocks but I think that's more an emotional rather than a rational inclination...

glorat
Posts: 279
Joined: Thu Apr 18, 2019 2:17 am

Re: [Singapore] 40yo New Investor

Post by glorat » Fri Oct 11, 2019 6:33 am

oken wrote:
Fri Oct 11, 2019 6:16 am
I think I may have used a misleading term when I said 'high risk'. Robos typically have a suite of portfolios to choose from and I meant that I intend to choose the portfolio of highest risk. Typically 80-100% equities.

Maybe some questions
1) Any thoughts on my decision to wait the downturn before investing? I understand conventional wisdom is to start as soon as possible but I can't get over the thought that I might lose 20% in a couple of months. =/

2) Any thoughts on whether Robos or a single global ETF might be a better idea? Or perhaps the right question ought to be, "Under what conditions would one choice be better than the other?"

3) If Robos are a possible choice, any thoughts on one which buys a basket of ETFs vs one that buys low cap Dimensional Funds (supposedly 'value' stocks)? I'm inclined towards value stocks but I think that's more an emotional rather than a rational inclination...
1) If you've got a lump sum available, the psychologically easier way is is to spread your entry into the market over the next few months. Aim to invest a fixed $ amount every 2-4 weeks. Don't look at the stock market, just plan ahead to put the same $ amount in every time. Dollar cost averaging makes you feel better

2) For Singapore, just 100% VWRD/VWRA is the simplest way to get going and IMO simply just cannot be a bad idea. You can fine tune when you have more experience, or realise such a simple way is the best way

3) If a Robo is going to choose ETFs and you already know your AA is 100% equities, then doing it yourself is cheaper and more effective. You'd need to really know what you're doing if you want to get into factor investing. Simple market cap weighted will avoid any mistakes and guarantee you to get average market returns with minimal costs

100% VWRD/VWRA

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