Opening Up

Still on my POSB RSP on STI and ABF Bond. I am a regular reader of some local blogs as well as hardwarezone Money Mind forum. There has been two, or rather three group of believers, who are debating thoroughly on different investment beliefs.

1st and majority of believers - Index investors. Invest regular in STI ETF, Bonds and mix in global index (some didnt mention this) and buy term insurance. Your gain will be much better than leaving it in life insurance to mature or even endowment plan. Expectation of this is that this will be your ultimate retirement funds. Main pro - low cost.

2nd and minor believers - whole life insurance. Believes that term insurance is "donating" money to insurance companies. They believe regular savings in life insurance, till 20-30 yrs, the cash value would be > your cash outlays. and these monies alrdy covered your insurance premiums with earnings. Pro - returns is fine, guaranteed capital, straightfwd force-saving, no diy needed

3rd group - insurance agents. They believe in selling. Naturally, they will be very incline to make endowment plans sound good. so they can drop the readers a pm and see got sales or not. i hv received quite a number after posting a couple of qns. I even ask an active forum agent what are his own allocation. he say one very small endowment, life insurance, the rest DIY in shares. Duh. these ppl r not even putting the money where their mouth is, how to trust them with your monies on investments?

I am an emotional trader/poker. thats why i do not diy shares, but i am still itchy hand buying many individual counters on top of my index investments. index investing shd be profitable in a perfect scenario - dollar cost average it, rebalance twice a year according to your age until old. but in reality, how manny of us got the discipline to do that?

that boils down to buy guaranteed returns tools, endowment? retirement annuity plans? the cost are high. the lockdown is long (if you diy invest long term, it shd be also quite similar timeline with this). u not sure agent r introducing the most suitable or highest commission product.

how many times u hv seen agent selling investment-linked policies, investing client monies into energy or emerging market WHOLE CHUNK and see how they fare for the last one year? then they start to sell your position at LOW, and buy something slightly more defensive, earning transaction fees in the process.

ultimately, retirement is in our own hands. even if u need force-saving products, do ur research and see what is suitable for yourself. u can close one-eye and pay ur agent car or condo. i myself hv surrender two blood investment-link policies at depressing loss.

so all the reading hv give me second thoughts on investing everything in STI. what if u r a japanese, born in 1957, age 30 in 1987... and started buying in ur country's index and age 59 now and trying to retire?? u wld be holding on to a loss for 3 decades..



nikkei is diversified with 225 companies... STI is only 30 companies, how diversified r we? so what shd we do?

i hv been buying in at current market and even eats into my savings. this is my current portfolio allocation. thanks to investmentmoats portfolio template excel.

my focus now is on my cashflow inside high-yield bank account like ocbc360, maybank saveup, uobone, boc smartsaver.

will update when there r much changes!

2015 Review

2015 just flew by. I do not have much to review because I only started most of my investing in the second half of the year.

I have been working in a brokerage firm before June 2015 and we hv very strict procedures to trade the shares. Therefore, I was not active.. on top of that, I hv wiped out my savings for my house renovation. Everything from emergency cash, savings and investment starts from scratch.

My first major trade is a downfall.. entering Sembcorp Marine at 3.04. That began the major hole in my investment portfolio. Subsequent STI ETF positions, Suntec REIT, Mapletree Ind Trust, didn't hurt me that badly when the whole market is going down.. but Sembcorp Marine did tear my underwear a big hole from behind.

I need to maintain my discipline in focusing on index investing, but I am always tempted to meddle with many individual counters, especially when Standard Chartered Online Equities platform offers such an attractive fees - no minimum brokerage. Partly, I find that STI itself does not covers Healthcare, Technology industries. Nevertheless, I am always in for the long term.

I hv also started following a couple of local investors and traders blog in 2015. I like popular bloggers who take the time to reply every comment in their blog post, they are humble and respect their readers. They inspire me a lot. My goal in life, is to achieve financial freedom.

What is your definition of financial freedom?

To me, I dont hv to be super rich, with savings that will not deplete. Rather, I am aiming to achieve passive income that is able to match my monthly expenses. That way, I do not hv to worry job loss, and I can even give my wife the freedom to be a full time housewife.

And how can I achieve that? High dividend shares? Dividend warrior, at my age, achieve about 2k monthly dividends with almost 300k value of shares. I am a peasant income earner for my age, I am not sure how long I will take to achieve this goal.

Anyway, 2016 will be a year I should complete my emergency cash portion and start building up my warchest. My overseas index r greatly under-proportion, therefore I will continue balancing my portfolio.

Have a great year!