I started investing w STI-ETF since 2015, $100/mth but recently stopped investing. I've invested in total $7.8k but its current val is at $6092.07.? - Seedly
Seedly logo
Seedly logo
 

Investments

STI ETF

ETF

Anonymous

Asked on 28 Sep 2020

I started investing w STI-ETF since 2015, $100/mth but recently stopped investing. I've invested in total $7.8k but its current val is at $6092.07.?

Should i withdraw my entire investment and move it elsewhere where i can earn back my loss ( & gain) since there's not much "hope" in the s'pore market , or should i just leave it there? any suggestions where else i can put this $ to work?

Wilfred HO
1 comment

21 answers

Answer Now

Answers (21)

Sort By

I sold mine at a 20% loss (few thousands) and never felt better. 😁

My broker probably thought I'm crazy when I called them with that chirpy voice to take out all my money from the account, because they reminded me that there will be a loss.

If you take out, you must know where your money can work harder than at STI-ETF.

If you have no clue, then there are two options: 1) the easy way out is to sit on it, do nothing and ride this out for a few years, 2) the more challenging route is to learn how you can do better.

I see my money as changing "jobs"/"companies" where it works at. I want to do better. That's just me.

Which one will you choose?

9
👍
15

7 more comments

Frankie Rappaport
Frankie Rappaport

3w ago

In the end you feel better when you sell the laggards, at least when most if your other investments thrive.
Sharon
Sharon

2w ago

@Aaron, I just told them my investment thesis has changed. I guess it's reasonable that they're kind of concerned, since I gave the instruction to also empty my brokerage account i.e. all the sales proceeds (cash) transferred to my bank account, leaving no investible cash with them. Probably in their mind, is when I'm closing the account and leaving them for good. 😅
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

It actually does not matter how your investment has performed since you first invested. That's history. What matters now is the future. The Straits Times Index has about 38% weightage to the 3 banks. Add in Singtel and Jardine and that's almost 50% invested in these 5 stocks. There are zero technology companies in the index and it is dominated by financials and real estate companies. Key question to ask yourself is whether these sectors will be the growth sectors of the future? Are Singapore companies able to compete globally or will they just be champions in their own tiny backyards?

The next question to ask yourself is whether there are better investment opportunities in other markets. Are there global companies with outstanding products and services that you use regularly? Do they have excellent and proven business leaders with support from experienced board of directors? Do they have good corporate governance with shareholder friendly practices that focus on increasing dividends per share and earnings per share?

There are many global companies that fit the criteria above. However, I think there are hardly any Singapore companies that fit the bill.

1
👍
10
Ajay Kumar

3w ago

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

Jaye

Level 6. Master

Answered 4w ago

Sharing my own personal opinion here, please do your own due dilligence and please understand that this is not financial advise.

To me, if I inherited your situation today, I would cut my losses with the STI ETF immediately. I personally think that fundamentally, the STI is unfavourable and things do not seem to be improving in the near future.

STI is heavily weighted to the performance of the 3 major local banks in SG: OCBC, DBS & UOB which to me, contradicts the purpose of a "general" index.

Indexes are for passive investing and good ideas to explore are VTI (Vanguard Total Index)

For more information (this is really quite a handful) please kindly refer to an opinion piece by a fellow seedly community member, Frankie

https://seedly.sg/questions/what-is-your-general-investing-philosophy-strategy?aid=32269

1
👍
7
Ong Ck
Ong Ck

4w ago

Strongly agree , park the money aside & monitor for 1 more month first.
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

What was your initial rationale for investing in STI ETF? Do these beliefs still hold true now? If yes, you should continue to invest, or rather, invest more during the downturn. If no, perhaps, you may consider cutting loss and investing elsewhere.

While STI has lower returns historically as compared to other regional/global markets, I wouldn't say there's 'not much hope'. Growth is still possible, though at a slower pace. There are other considerations to be taken into account if investing abroad such as increased foreign exchange risk, withholding tax, etc.

0
👍
6
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post
Kevin Seah

Kevin Seah

Level 6. Master

Answered on 28 Sep 2020

It's actually the best time to invest in STI ETF. Remember, when you suffer a big loss on a reliable stock or ETF you have confidence in, it's the golden hour to put more money in. Think long term and you won't feel so sour about the loss!

Cheers!

0
👍
5
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Have you considered the dividend you recieved over the years? These will form the actual returns and losses.

In addition, do you have war chest or additional funds for other investment? If not, is this amount your only investible sum?

What will be your next investment? How comparable in terms of returns and risks? What will be the horizon that you are looking at for the return?

Hope these few questions can move you closer in your decision making.​​​

0
👍
4
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Did you include the dividends for the last 4 to 5years? Yes, Sg markets may be slow compared to elsewhere but over here, you are spared of currency risk and wht etc. If 1k losses can make you question your local investments, what makes you think the losses elsewhere won't be higher since more 'hope' is there? Given the covid situation, things bought pre covid would be at a lower valuation at the moment with the exception of some. There's no saying that covid wont come back in a 2nd/3rd wave so if you had bailed out and bought something out of Sg market, chances are your losses will be even more than original. All markets are unique and so are our investing methods, make sure you take advantage of bad situations if any arises.

0
👍
3
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

The reason your current valuation is low is mainly due to the COVID situation, markets are down. In the long-term, you will definitely have capital gains and along with the annual dividends, you have more than you paid for. I urge you to be patient and tide this through unless you need the $6k right now

0
👍
3
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

From your figures, it looks like I'm slower than you by around 1 year.

These are my thoughts.

I have different pieces that forms my overall portfolio. There's the active and passive components. The reason for a portfolio is such that should things go south, there are other segments that can (hopefully) minimise the impact.

For DCA/RSP, I have STI ETF and S&P 500 ETF. This portion forms my passive component of the portfolio. The goal at the end of both passive investments is that hopefully, the investment can fund itself. This year, the dividends is around $200, which means that out of 12 months, I only need to pay for 10. Another way of looking is that originally, I budgeted $1200 for STI ETF. Now, I have additional $200 for other investments/expenditure.

The fact that it is automated helps to take away the active portion of things, ie need to remember to buy every month, need to not be emotionally affected by price, etc.

TL:DR

End goal would be to have a portfolio that minimally, keeps up with inflation, and either funds itself, or provide me with the passive income.

0
👍
2
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Sharing my own personal opinion here, please do your own due dilligence and please understand that this is not financial advise.

It is indeed the right moment to continue investing into STI ETF if you truly believe that STI ETF is the right place to park your money at. If you enjoy the dividends and love the companies that are on the fund itself, go for it, DCA more into it and you'll be fine once we pull out of the pandemic.(assuming the majority of the companies come out strong enough of the pandemic too)

Another question that you should ask yourself is, if you were to take out the money, where would you put it? Thereafter, compare that option to the option of letting it sit in the fund.

Will you get higher returns?

Do you need the money immediately for something?

Are you just going to put it into a bank account that may possibly give you even lower returns than the fund?

I was in a similar position to yours. The companies' health wasn't my concern when I decided to get out, but rather my investing fundamentals changed. I decided to invest in stocks/funds that push for higher returns/growth since my risk appetite should be higher as I'm in my 20s.​​​

0
👍
2
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

If you don't need the money now, I would advise you not to actualize your loss (or if you can afford it, you can even take advantage of the situation that STI is really cheap at the moment right now). ​​​

0
👍
1
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

5 years is actually not considered long-term investing. Continue to hold on for another 15 - 25 years. DCA every month. Your annual growth (before fees) should reasonably be at least 4-5%.

0
👍
1
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Arguably the main advantage of dollar-cost averaging (i.e. investing the same amount at regular intervals) is that you get to buy more stock when the prices drop, and there is no need to "time" the market.

2020, by that logic, would be the best time to keep doing DCA, because the same amount of money is now picking up more stock than before! Either way, I am in agreement with many of those who have already answered - this is the worst time to cut your losses.

(Personal opinion and not advice from a non-financial planner: DCA is generally a low-risk, low-reward, long-term investment product. One should always reasses their risk appetite and investment personality and find out what products are more suitable for them.)

1
👍
1
Joshua Ng
Joshua Ng

4w ago

Historically the price has hit 3.5k 8 times in total. Compare the last low was 1.8k points. If u go in at 2.5k. then upside is 1/2.4 . Who says it's not going to be great ? It's a matter of time with dividend still pay out bi yearly.
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Hi there, it depends on the fundamental reasons you went into STI in the first place.

STI has nvr been great for capital returns, the only reason to me logically would be for dividends if you compare to US. If that has not changed, neither should your investing decision.

However, if you want to go for capital gains, taking a lost and pumping the money into something with higher capit gains can be more beneficial than waiting for a loss to break even...

There are huge opportunity costs to that. Sometimes accepting a loss and quickly building back up is a much better decision rather than trying to keep a clean record.

0
👍
1
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Hmmm, the word u used was investment, and did you also add in the dividends that you received over the course of your investments? Investment is for long term, now is actually the best time to DCA more at low prices.

I'd think that "investments" should have a long time frame, at least 5 to 10 years before concluding it is bad. Ignore the noise and follow your plan!

0
👍
1
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Unless you are confident that your new investment yield better returns, otherwise what's the point of realising the loss?

0
👍
1
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post
S

Samuel

Level 4. Prodigy

Answered on 28 Sep 2020

You are losing quite a bit becasue you bought in when STI was trading near its peak in 2017-2018. What I would suggest is to continue investing monthly to dollar cost average (you can buy more units now to bring down our average price). The economy would probably recover in 2-3 years so best thing would be to hold on now and take a long term approach. You can look to diversify from STI into other platforms like stashaway or Endowus

0
👍
1
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

You would probably do better by simply getting an index fund through a broker or any robo advisor platforms. I wouldn’t flinch changing from STI to other markets, market here is too small to see any huge profits as a casual retail investor.

0
👍
0
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

I understand your predicament. You're currently at a 21% loss and right now it is more of a psychological game of opportunity cost.

In your shoes, perhaps i would find an exit price in the next 1 year that you're comfortable with. If this is your throwaway cash, great, hold it out!

Time in market is better than timing the market.

-g

0
👍
0
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post

Try NASDAQ 100.

0
👍
0
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post
Load more answers