Hi I’m new to ETF I’m still not too sure what I’m I supposed to do with it to profit. I used the POSB RSP currently. Do I sell the units at certain point of time or do I accumulate to earn dividends? - Seedly
 

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Asked by Anonymous

Asked on 28 Jun 2019

Hi I’m new to ETF I’m still not too sure what I’m I supposed to do with it to profit. I used the POSB RSP currently. Do I sell the units at certain point of time or do I accumulate to earn dividends?

Can someone please advise me on it? As I’m really quite confused despite reading plenty of articles :(

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Yinghua Liu
Yinghua Liu
Level 5. Genius
Updated on 28 Jun 2019

For your investments to profit, you would need to look at both capital gain and total dividends over the years.

It is recommended that you invest for long term as cost price per unit will be optimise (more units bought when price is Low, less units when price is high) Over time, you will get dividends which you can reinvest.

Sell only when you really need the money.

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Lok Yang Teng
Lok Yang Teng
Level 8. Wizard
Updated on 28 Jun 2019

As do with many other forms of investments, you generally hold the asset until you really need the cash (e.g housing/car). This is especially so for beginners who have yet to understand how to spot trends in market/pricing. For the RSP, you'll accumulate the units as you go and earn dividends. Sell the units only when you need the money not when market pickup or slump.

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Eric Chia
Eric Chia

28 Jun 2019

To add on to the answer above, ETF is not exactly an investment that you can take out the next day (when the price is really bad), so have in mind to sell when you've plans in the next 3 to 5 years.