Asked on 03 Jul 2020
Prominent blogger like ASSI AK and Dividend warrior, both are doing well by just investing locally.
Indeed you do not necessarily get poorer results just because of a geographical location. Warren buffett advocates staying within your circle of competence, fundamentally u should be looking for an edge if as a consumer in the local context can give you that then you should maximize it but then again alot of the services we use nowadays are international i.e apps u commonly used. The fundamentals are to invest in what you know.
There is no wrong or right answer to this.
But in general, I would say that US-listed companies as a WHOLE are fundamentally more solid in terms of future growth because they are more globalized. Think about your Apple, Google, Intel, Nvdia etc.
So the first question you need to ask yourself is: what kind of companies do you understand, analyze them, and decide if they are a good company - no matter is it local or overseas stocks.
Second question: are they run by great and honest management?
Third question: are they sensibly priced?
Answering these three questions will lead you to the right answer most of the time.
If you have more questions, I am more than happy to chat with you here.
My opinion. Dividends are for those who already has a huge snowball - sum of money.
The more money you have, the more dividends you get.
For example if you have only $1000 to invest, and divident is at 5% annually, it will be $50.
But if you have $1 million that is $50,000 annually.
I would concentrate on capital gains vs dividends if my snowball is not huge.
I am still working on the huge snowball. So I would concentrate on stocks with capital gains.
I would go for US markets for that, personally. As the volume traded there is much more compared to Singapore.
Just my opinion.
Lets together create that huge snowball!
I made a video on monthly investments - https://youtu.be/t4Npy3BLm2k
If you are interested to watch it!
You need to understand there is no true right and wrong.
Like what Warren buffet suggests investing within your circle of competency, your capability will tell u what is right for you.
If u feel adventurous, go ahead and venture outside of SG. The bonus is diversification
Rome was not built in a day. Neither will your portfolio.
People have their own way of accumulating their wealth and returns, find a strategy that best works for you. I avoid dividends because I'm in no rush for income. My business generates that better than whatever capital I put into shares and stocks.
If the company can take my dividends and reinvest into the business while gerating a better ROE, I rather have that as it will increase my ROI due to the tax benefits.
People have lost money investing abroad as well. No single strategy will work for all investors.
青菜萝卜各有所爱，to each his own.
You need to have a huge capital to just invest in SG dividends, cos these stocks grow their dividends slow/stadily, to get a credible flow of income from dividends though
No, not a good idea (with the exception maybe if U.S. resident ...)
home bias is bad bias. are they successful for very longterm?
better diversify globally. Singpore is so small a market.
Yes. You are right AK, Dividend Warrior and others on Investing Note or StocksCafe are doing really well investing locally into REITs and Bank Stocks. It is a viable strategy for them because they have amassed a large capital (most of them are middle aged man 40+) so the capital they inject with a dividend yield of around 5%-7% from the S-REITs is really attractive. (Eg: 5% yield of 500k vs 5% yield of 20k)
So in case you have 6 digit spare cash/warchest to pump into the market, yes go ahead and choose a few solid REITs if you are bullish on Real Estate. (do note dividends are getting cut as REIT managers are keeping spare cash for rainy days currently)
If you are a young person with <100k capital, you should focus more on growth stocks (which are found in US Market). Of course you can allocate a portion into local stocks but do note SG stocks are DIVIDEND PLAYS.
Personally, I own a few SG stocks myself and slowly tilting towards Growth stocks. (from the USA) My strategy is Dividend Growth investing so that in good times my growth stocks appreciate while bad times I can just hold on and collect dividends. In the end it is really up to you.
Investing has no 1 solution. You can be like Warren Buffett and focus fire on a few good stocks or be a Peter Lynch and buy into a huge number of stocks to increase chance of a potential 'Multibagger'. At the end of the day, stick to your convictions and understand what you are doing.
They are dividend investor thats why they only invest in local stocks. Singapore market is useless if you are vying for capital appreciation.
Both of their investment methods are geared towards dividend investing. It is made possible by the high yield S-Reits and blue chip stocks, and no tax liabilities on these payouts. However, dividend investment requires high capital to be effective and hence not the starting investment objective for most people. Often, they would look at growth investment to appreciate their capital, espcially those with longer investment horizon. Progressively, they may switch to dividend investments to earn passive income. While there is nothing fundamentally wrong even if you choose growth investment in Singapore, there is a large opportunity cost as compared to investing overseas where growth rate is much higher.
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