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? - Seedly
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Anonymous

Asked on 28 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?

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    Hello,

    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.

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    Thank You!
    Can you clarify
    I wonder if
    This is so helpful 👍
    What about
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    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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    Jay Hou

    Jay Hou

    03 Dec 2020

    Keywd tht YJ has shared brilliantly is : "Sg stocks can DCA, coz the price is so stagnant compare to US. As for S&P500 would propose periodically 1 lump sum to invest...." While we should never Time the market, it is also street-smart and Logical not to DCA/RSP into nearly everything....certain things are Obviously not meant to do DCA/RSP as YJ has rightfully pointed it out
    Thank You!
    Can you clarify
    I wonder if
    This is so helpful 👍
    What about
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    Don't waste time and money on sti, super terrible index. focus on stashaway or consider syfe100

    1

    Jay Hou

    Jay Hou

    03 Dec 2020

    I was expecting to read your adv on not to waste time on STI
    Thank You!
    Can you clarify
    I wonder if
    This is so helpful 👍
    What about
    Post