29 Nov 2020
Hi, currently I'm investing $500 into STI ETF and $400 into StashAway (22% risk) per month. Looking into DCA into S&P 500 ETF, would that be a good strategy since I'm currently a beginner investor?
Is a portfolio of STI ETF, StashAway and S&P 500 ETF a good investing strategy for a beginner?
Investing in the STI ETF isn't necessarily bad. Just take note that the STI ETF is more for dividend investing. i.e. You can expect tax-free dividends from the ETF, but don't expect your investment value to appreciate as much as the S&P500 ETF.
It is also probably a more cost-efficient way to invest in the local market. Buying individual stocks would cost more as you'll incur flat fees from buying through the brokerages.
For the most part, I would say your strategy isn't bad.
You have the STI ETF denominated in SGD that serves as a hedge against currency risk.
You have investments in a globally diversified portfolio for growth.
If you're unsatisfied with the performance of the STI ETF, you can consider:
Allocating more to StashAway
Purchasing SG bonds instead and increasing your risk in StashAway to allocate a higher % to equities.
Of course, the above are just suggestions, do your due diligence as well.
Should NOT buy STI index, coz is contain some bad apples in it. Just buy the 3 local banks. It make up of almost 40% of index. Sg stocks can DCA, coz the price is so stagnent compare to US.
S&P500 would propose periodically 1 lump sum to invest. Because every few month market will have some huge correction.
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Don't waste time and money on sti, super terrible index. focus on stashaway or consider syfe100...
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