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Sandra Teo

Sandra Teo

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Sandra Teo

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Bonds

Investments

What is the incentive to investors for buying green bonds?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 04 Dec 2019
Hi there! One incentive to buying green bonds is that green bonds could be a potential hedge against climate risk. For investors feel that climate change will potentially affect companies and government, by adding green bonds, it will represent a "free option" to hedge climate-related risks. Another incentive is the corporate disclosure. This additional disclosure as compared to traditional bonds creates more dialogue between the borrowers and lenders. Historically, green bonds have also been able to deliver reasonable returns with relatively low volatility. Here is an analysis of the data done by Eastspring Investments. !
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Seedly PFF 2019

Investments

Stocks Discussion

Emerging market stocks are cheaper than US stocks now but it looks enticing as a long-term investment. Should i add more emerging markets to my portfolio?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 04 Dec 2019
Morgan Stanley analysts expect emerging markets to outperform in 2019 with a base case forecast of 8% price return for MSCI EM index. Based on the earning growth prospects for the MSCI EM index, it compares favorably with the S&P500 index, standing at 10+% and 6+% respectively. However, historical data has shown that over the last 6 years the Y-O-Y earnings growth is 0. This goes to show that investing in EM is a long term strategy for investors with a high risk tolerance to be able to ride out the high volatility of the em equities market. ! Year-Over-Year Earning Per Share Growth for MSCI Emerging Markets Index, Bloomberg Data
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Investments

Stocks Discussion

Will markets rally with the March 1 tariffs delayed by Trump?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 04 Dec 2019
China stocks surged 5% after Trump announced a delay in hike tariffs. This China rally is expected to lead other Asian markets for a bull run. ! The optimism is also represented by increases in the yuan , South Korea's won , Australian dollar and Indonesia rupiah . The US markets also rose. Emerging markets is expected to rally strongly and is expecting some profit taking when US and China comes to a deal.
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Investments

Can someone explain to me why share prices of Genting tanked?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
The selloff on Thursday was due to the announcement of casino entry levy and tax rate hikes. Investors were concern with the negatives quantifiable impact of the gaming tax on earnings. The plunge in share prices was also after Genting unveiled a S$4.5 billion expansion plan. This expansion plan that includes the construction of a fourth tower at MBS, a Minion Park and Super Nintendo World at Sentosa has long-term benefits however, in the short run Genting will take a hit in earnings growth and cash pile. The higher casino tax rate will take effect in 2022 and the hike in goods and services tax to 9% between 2021 and 2025.
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Securities

Unit Trust

ETF

Investments

As a beginner investor, would it be better to invest in ETFs or mutual funds?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
Hi there! If you prefer lower investment minimums, an ETF is more suitable for you. Investors can buy an ETF for the price of 1 share (ETF's market price). Depending on the ETF, the price could range from as low as $50 to a few hundred dollars. Whereas, a mutual fund isn't based on the fund's share price. It is a flat dollar amount, most mutual funds have a $1,000 minimum that buys investors 10 shares of a hypothetical fund with a net asset value (NAV) of $100 per share. ETF provide investors real-time pricing and allows investors to use sophisticated order types that give the most control over the price. However, in a mutual fund, regardless of the time of day you place the order, you will get the same price as everyone else who bought and sold on that day. This price isn't calculated till after the trading day is over. ETFs typically track a specific market index whereas mutual funds are actively managed to buy or sell assets within the fund where fund manages attempt to beat the market and help investors profit. Personally, I started off investing in ETFs as it has a lower investment minimum and ETFs could be bought through virtually any online brokers whereas mutual funds were not always available through all brokers. Since I was focused on building wealth over the long time, the liquidity of ETFs are compared to mutual funds was another reason I choose ETFs over mutual funds.
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Investments

How is the value of an ETF determined to be overvalued or undervalued? eg. Lion-Phillip S-REIT ETF?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
Hello! The value of an ETF can be measured using its net asset value (NAV) . The ETF's NAV is the price at which shares are bought or sold from the fund company. If the NAV is lower than the market value, the ETF is said to be trading at a "premium". If the NAV is higher than the market price, the ETF is said to be trading at a "discount". One thing to note is that the NAV is usually only given at the end of the day, whereas the market prices of ETFs changes throughout the day. Another method to determine of the ETF is overvalued or undervalued is to compared the ETF in question to one of the same industry or geography. According to historical fund performance for Lion-Phillip S-REIT ETF Fund, the benchmark index performed better than the ETF most of the time and despite a -2.6% year-to-date returns in 31 Aug 2018, the ETF still clocked a +3.0% return since inception. Comparing Lion-Phillip S-REIT ETF its one year returns are better than Phillip SGX REIT ETF (-0.74%) but losses out to Nikko AM Straits Trading Asia Ex-Japan REIT ETF return of 0.75%.
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REITs

Investments

What are some good REITs that I can consider for a passive portfolio?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
Hi there! One reit with a good track record in revenue growth and distributable income First Real Estate Investment Trust (SGX:AW9U). First REIT is a healthcare REIT with properties located in Indonesia, Singapore and South Korea. Over the past 10 years, Firts REIT has achieved a CAGR of 18.03% in portfolio valuation. It expanded from 4 properties worth S$257.1 million in 2007 to 20 properties worth S$1.35 billion in 2017. Additionally, the group revenue increased from S$28.1 million in 2007 to S$111.0 million in 2017 (CAGR of 13.8%). In terms of distribution per unit ( DPU ), First REIT grew 1.2% to 8.57 cents. ! ! ! Moving forward, First REIT seems to be able to sustain growth with its favorable lease agreements and strong pipeline of properties for potential acquisitions in the future. Additionally, as of 31 Dec 2018, the REIT's gearing ratio stood at 35% which is considerably lower than the regulatory gearing ceiling of 45%. This puts First REITs in a good position to fund future acquisitions through debt.
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Investments

SeedlyTV S1E01

Which type on investment strategy, passive or active carry higher risk?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
Hi there! As Zann mentioned, active investing strategy typically involves higher risks. Active investing is when the investor tries to beat the market and if succeed, it translate to higher than average returns. On the other hand, passive investing is adopting the buy and hold tactic. A passive investor is thus limited to an index fund (only tracks index and as such will not outperform the market). When the market is volatile, active investing outperforms more often than when it is not. However passive investing is appropriate as specific securities are highly correlated. When used in tandem, you can leverage the most valuable attributes of each market. One thing to note when using a mix of both strategies, is that achieving successful active investing has historically proven more difficult within select asset classes and portions of the market (eg. large companies). So depending on your situation, it may make more sense to veer a bit more passive in those areas and rely more on active investing in asset classes and parts of the market where it has historically proven more profitable to do so (Eg. international stocks and smaller companies)
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Investments

What alternative investments should I buy in 2019?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
P2P (peer-to-peer) Lending has been gaining alot of attention recently. P2P lending offers loans for both businesses and personal use. How P2P lending works is that your money is typically pooled with other investors' money and together you make a loan to the individual asking for funds. You will then receive fixed repayments each month which includes the interest you are owed. Another alternative investment is gold. Gold is a great asset for diversifying your portfolio as it has low correlation to other asset classes and is an inflation hedge.
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Investments

How can I tell if a company will continue paying good dividends and possibly increase dividends?
Sandra Teo
Sandra Teo
Level 7. Grand Master
Updated on 07 Jun 2019
Hi there! You can look at the current financial health of a company. Generally, if the company is consistently doing well and has positive growth prospect, it will most likely continue to pay their dividends. To know if the company will increase dividends is to first determine whether its current dividends is sustainable. The dividend payout ratio will tell you how much of a company's profit are paid out to investors in dividends. A low percentage indicates that the company has plenty of room to pay dividends and potentially will raise dividends in the future. Whereas a high percentage indicates the company can barely pay the dividend and thus less likely to increase dividends.
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