Understand that SG market is pretty dead compared to the US. Since I'm still young, should I sell all of my holdings in SG and move over to the US? - Seedly
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Anonymous

Asked 3w ago

Understand that SG market is pretty dead compared to the US. Since I'm still young, should I sell all of my holdings in SG and move over to the US?

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Hi there!

I'm personally all for US over Singapore market.

However, I feel it is unfair to say SG market is dead. The main differences of advantages for both would be...

US: Better for capital gains

SG: Better for dividends

There are of course more differences... However, how you should invest in things that are within your circle of competence and that you have affinity to. If you are more well-versed in the local companies and market, you may even make more with the local market.

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I started off investing in the SG market as well. Majority of it were REITs. Over the years, I realised it doesn't meet my investment goals in terms of growth, etc., and dividend yields are too "stable". I recalled selling off STI ETF at almost a 30% loss and never regretted my decision after. Of course, you should ascertain if you would like to wait it out for things to stablise to mitigate your losses/profits. Perhaps take this time to understand what's your investment strategy when investing in Us. US markets are way exciting when it comes to growth over the long term horizon, but super volatile as well. You need to manage your emotions if markets go bearish (at one time my portfolio was negative 50%). There's also a ton of competitive brokers out there offering zero or low commission trades (TD, Saxo, etc.) for US stocks.

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You should only sell your holdings in the SG market if you are invested in fundamentally failing companies which are heavily affected by the COVID-19 pandemic. Otherwise, there is no need to withdraw from the SG market just to port over to the US side as it would be a good opportunity to build you dividend portfolio by just holding the right SG stocks. Some prime examples would be the three Mapletree comapanies, Ascendas REIT and CapitaMall Trust (should recover soon with reducing COVID numbers).

The US market is indeed growing. However, we cannot assume its growth can be sustained in the short term since it has been experiencing a bull run for the past few months. Recently, the US market has experienced burst in its NASDAQ tech bubble and we won't know if it will suffer another blow in the upcoming US elections.

My advice would be to continue investing regularly with a fixed amount (Dollar Cost Averaging) every month instead of switching over with a lump sum. This way, you reap benefits from both markets in the long term. You can minimise volatility risk in the US market while staying invested in the SG market to build a passive income stream over time. Stay consistent and always look ahead!

Hope this helps 😀.​​​

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Hi Anon! Remember to consider your risk appetite before deciding which market you would like to enter. Some people might think that the SG market is safer since it is home-based for us, but there have been some articles that suggest that the SG market is riskier, since we are reliant on so many countries, and the fact that the STI and S&P 500 are dominated by companies of different industries.

Check this article out on Seedly to understand the difference between both countries' indexes and investment insights: https://blog.seedly.sg/sti-vs-sp-500/

Personally, I think it is a good time to jump into the US markets, but that does not mean you should move all of your holdings completely. Consider moving at least half over so you have your foot in both markets and perhaps once you have a better gauge of the market performance, you may change your investment strategy from there.

Good luck!

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I'm still holding onto my SG REITs/Trusts portfolio which I set up in Oct 2019. REITs/Trusts do give some form of stability, tho' I do plan to trim down on some not so good ones, once the economy is in a better shape (maybe 2-3 years down the road).

At the moment, I put the dividends received into the US markets (on top of some additional capital). Just to make sure money keeps working hard and not idle. If you have dividends (maybe not REITs/Trusts), you may want to consider to do the same. It can be anywhere, not just US markets.

Also, if you'd like, you can consider selling off stocks of mediocre SG companies and cycle the proceeds into growth companies.

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1 more comments

Sharon
Sharon

2w ago

I didn't research into the company (not my type) so I can't give you a meaningful reply. Sharing some thought process on how I will do my research to decide whether I want to hold or sell it. First is to look at the fundamentals - an objective view to see whether they are in strong financial position to tahan this storm before travel picks up. Good to check especially the last quater. Off-hand I think you may want to check is 1) How much cash do they have in the bank?, 2) How much short term (need to pay within 1 year) and long-term debt do they have and need to repay?, 3) How much money are they burning to minimally maintain the business? I'd think this is the Capital Expenditure that you need to look at under Cash Flow Statement - the Property, Plant, Equipment. Just have a general feel on sentiments, you can search for the same question by other SATS shareholders in Seedly. Or if you want, you can also go to Seedly Personal Finance Facebook Group or InvestingNote to search for any comments on SATS situation. Here's one example: https://seedly.sg/questions/should-i-liquidate-my-sats-s58-holdings-holding-onto-2-000-shares-at-3-64-per-unit-please-see-description-for-more-details Other than the above, you need to look at some macro data like global air traffic and see if there's slowly an uptick. You can then check against the clients they serve. Other factors that may affect your decision, is also whether you have a better company to replace SATS, whether you believe in the quality of SATS management etc. Sometimes, it's not an easy answer to whether hold or sell, or maybe even buy more. :)
Question Poster

2w ago

Thanks Sharon! Very insightful
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Hello,

Go for sg if you're looking for stability and dividend.

Go for US if you want growth via capital gains.

However, expect more volatility in the US market.

You might want to dollar cost average on us market to reduce risks. (I'm assuming you're buying an etf that follows the market, since you will be getting both at lows and highs, regardless of pricing, you will still gain because the market always goes up average 7% per year)

Maybe you could even use those dividends gained in SG to fund for US 😂

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If you got the time, you go and compare the STI with our neighboring countries index. Then after that you compare with Nasdaq and S&P500.

While you wait for STI to recover, others are happily making money.

So you decide.

Happy Investing. !

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If you are a young investor, I assume you have a small starting capital of less than 100k so it won't make sense to invest into dividend based stocks like the ones in SG.

So best would be to emphasise in US growth stocks which has high growth potential in the long run. For myself, i am currently 25%SG 75%SG and overall in a +37% gains this year. Majority being carried by US stocks. Hope this helps!

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Question Poster

2w ago

Thanks Yh, do you invest in individual stocks or through a robo
YH
YH

2w ago

Hello anon! I invest in both👌🏻 u can view my portfolio on StocksCafe by searching yhlin
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In addition to the great answers here, it's important to note the costs of investing in the US (if converting SGD to USD, and paying witholding tax levied on any dividends from US stocks) vs the Singapore market. And the fact that US companies are subject to market forces, political changes etc that we can't follow as easily from Singapore.

Also consider, will the US continue to be the pre-eminent economy and stock market over the long, long term? I am not so sure. It'd be good to make sure you have coverage from other markets (China? Hong Kong?) in addition to the US.

Having said this, given the range of sectors and companies on the US stock markets and the growth prospects there, I do find it has been worthwhile to invest in both the US and SG markets, as well as others. ​​​

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I guess it's what you want to get out of your investments - some of my peers tell me "aiya don't bother with the SG market, it moves so slowly". Though that's true for say, someone who day trades, I think it's perfectly fair for someone who's focused on dividends / steady growth to stick to the SG market. I personally try to keep up with both, because the stock picks in the US market are a little bit more exciting that what's currently trading on sgx ahhaha

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Yes indeed SGX is not as volatile as you expected but the benefit of this is you don't have to be looking at the ticker every single day compared to the US stock market. That said. US Markets will give you returns quicker due to it's volatility. But you will profit only if you are very skillful or lucky. So if you want to invest in US markets, do study a lot if it interests you. Have fun!!

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Jovan Lai
Jovan Lai

3w ago

Hi, I agree that US market is more volatile but it doesn't mean you have to watch it every single day. Unless you are day trading.
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Hi there!

I wouldn't allude it to being dead. Certainly, it hasn't been seeing many price movements, but I can assure you that Singapore stocks are actually trading at very cheap valuations based on the 10Y CAPE Ratio. But of course, cheap doesn't mean quality.

Nevertheless, if you are seeking to shift your funds over to the US, make sure you understand what is your investment objective. If you are seeking to preserve capital and make dividends, then staying in SG would be better since yields are still not bad 4-5%.

If you seeking growth, then based on historical data, the US has seen great growth year on year. But of course, keep up with macroeconomic indicators which may suggest a change in the economic regime.

There will be caveats when deciding to move into the US stock market. Things like volatility, irrational market behaviors, etc.

Maybe you might want to find some solid companies before investing, otherwise, just go with the standard ETFs that tracks the SP500 index like IVV

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