facebookHi, I'm a uni student who just started investing using robo advisors for 6 months now. I'm looking to invest in stocks by myself, should I start with exploring the local market or foreign (US)? - Seedly

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Anonymous

22 Jun 2021

General Investing

Hi, I'm a uni student who just started investing using robo advisors for 6 months now. I'm looking to invest in stocks by myself, should I start with exploring the local market or foreign (US)?

I'm basically looking for other possible "pathways" to grow and put my money to work, more towards long term gains. If there are other ways to do so, I will be interested to hear your suggestions!

Discussion (7)

What are your thoughts?

Justin Mok

Justin Mok

17 Sep 2020

Level 8·Bachelor of Business Management at Singapore Management University

Hi there!

Happy to hear and share my thoughts about active investing. Kudos to you for seeking advice before taking the dive.

It seems like you are more interested in growing your capital compared to preserving it, and perhaps more risk-tolerant. That is the sense that I am getting from your question.

If that is the case, I would recommend exploring into US markets.

  • Blue is the S&P 500 Index (SPX)

  • Orange is the Straits Times Index (STI)

Right off the bat, we can see that the US financial markets have recovered faster than SG markets. But keep in mind that it is generally more volatile and riskier compared to the SG market.

In my own experience of investing, I personally favor the US markets more than SG markets. Mainly because of the larger market exposure and liquidity that US markets have, and the composition of Technology stocks that makes up the S&P 500 relative to the STI.

The top holdings of STI are most Financials, REITS, and Telcos, which I feel don't really have much momentum as compared to stocks like AAPL, AMZN, and MSFT, all in the Technology sector.

I would favor the STI more if I am looking for dividend growth because of the 30%/15% (Irish-Domiciled) withholding tax that US equities inherently imposes.

I still do recommend holding onto your Robo-Advisors for diversification.

Moving forward, you can adopt the bottom-top approach in selecting a few companies that interest you. Preferably something that you understand. Maybe if you are a CS degree student, you can perhaps look into Cloud companies or Fintech, etc.

Study them closely, do your due diligence and build that conviction within yourself. Once you are ready, open a brokerage that offers access to global markets and start investing!

_Seedly _has a great article that lists most of the brokerage that does it. https://blog.seedly.sg/how-to-buy-us-shares-in-...

Hope this helps! Happy to share if you need any more information.​​​

View 2 replies

Hello! I've had a similar concern myself, so I thought of sharing some of my perspectives. As much as I sought out opinions of others who were more experienced in this field than I am, I always felt that the knowledge I gained was passive. In other words, without actually trying things out by myself, I would just be another one of those investors who make decisions based off the opinions of others. Thus, I made the decision to invest in both markets. For starters, I recommend that you identify your investment goal for entering each market, and start with a small amount in both markets - think of it as a way to "test the waters". After awhile, I believe you will have a better understanding of the two markets from personal experience. From then on, you may decide to only focus of one of the two markets. Besides, if you're looking into being a long term investor, you would eventually come into contact with various markets, so why not start now? Just my two cents :)

Just a low expense ratio etf that tracks the S&P500 will do....

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