July 29, 2021

18 thoughts on “Why STI Index investing is not as lucrative, and long term future is not bright?

  1. Hi Rolf,

    Insightful article again that makes for a good read. Happy to have you back writing again.

    As an index investor who started out with STI ETF and eventually branching out to VT and robo-advisors, I do find myself questioning the long-term viability of the Bogleheads 3 or 4 fund portfolio that is adapted for Singaporeans.

    Considering our unique asset allocation (with a huge tilt towards SGD in CPF and property), it is a possibility to ignore STI ETF altogether and focus on a global portfolio. With a robo-advisor like Endowus, even CPF-OA money can now be used to build a global portfolio easily and fairly low cost!

    1. Hi Kevin, thanks for the compliment. Reading ur blog also inspired me to write again. In fact the other day, I read one of ur posts on Google Analytics n I d/l it. It is interesting. I am IT dumbo, so love to learn all those things from u guys. Oh ya..n also Adthrive as well.

      Interesting to hear Robo-advisor n Endowus. Learn sth new each day again.

      Guess most of us started from STI n as we grew, we venture out. STI is more like BMT. 🙂

    1. Hi FI35, wow. that is pretty incredible. The topic and timing.
      You have an exceptional blog with nice design, and I added you in my blogroll.

      Love what u wrote below…

      "Its also not a good premise to invest in things just because they have become cheaper. If you had invested in horses because they were dropping in price when cars came out, you would be stuck with a lot of horses and poop. "

  2. Hi Rolf,

    Found yr blog a while ago. Not many retail investor take gold seriously. I do think they played an important in a portfolio especially the coming decade if not longer.

    I agreed that most of us have strong home country bias, i am also considering just adding S-Reit etf as the local equity component limited to not more than 20%.

    How do you think abt the bond going forward, i am of the view that bond and gold should be equal in a portfolio going forward.

    1. Hi tcs, tk u so much for visiting n reading. Really appreciate it.

      I think for a start, investing can home country bias. Frankly I did bought into STI too recently. Reit is SGX core, so it is good to earn dividend. And there r many good reits around. I m vested in Reits myself.

      For bond, which type are u referring to? I m only familiar w Sg bond. Mostly those w very low risk n 2-4% return. Govt Bond, SGS, SSB? or corporate bond? I am vested in SSB few yrs back n continue to hold as it gave >2.5% n also 100% liquid. Corporate bond have to be careful eg Hyflux, not so good. Fraser 3.65% I m vested. ABF bond is also safe. If bond below 2%, I personally think it is too meager return.

      For precious metal, I am a strong proponent of gold n silver.

      In 2015 onwards, I started to sell my stocks to enter into Gold and Silver. Wrote many articles. See below. I also believe in bitcoin n own some although lately I cash out all my BTC n only left ETH.

      Portfolio has to be overall. Not just stocks. And depending on timing n ur own personal financial situation, ur work n family situation….

      Prior to the crash, I am 39% Cash, 37% metals, 6 % crypto, 9% shares, 9% bonds.

      Currently,  I am 51% Cash, 28% metals, 15% shares, 5% bonds, 1% crypto.

      I do have a good decent size portfolio. And to be honest if Property price fall, I m considering acquire one more.




  3. Hi Rolf,

    Me too sti holding ES3, for now will build up more international 1st. I think S-Reit is a favourable asset class in SG. I may even consider only to keep it as my local stock component. I am not too worry about the outlook of certain sectors like retail, commercial or hospitality because logistic and helathcare will do better.

    For bonds, i am not too ken to own corporate bond individually. I have one quarter of bond in 30yrs sgs bond which has 2.75% yield. The problem is it is virtually no way to sell in the market, the liquidity is died. If sgs bonds has good liquidity, i would rather buy midterm and long term sgs bonds directly than through a35 or mbh.

    Do u own mostly physical metals or paper? I am thinking of increasing to 20% but not sure should just keep 5-10% paper and the rest in physical or not. Premium is still crazy high now for both physical gold n silver.


    I believe in cryptocurrency and blockchain as a whole but BTC in its current form i am not so sure. I see in the foreseen future, every central banks will either work out few major currencies or each will have their own one coz no central bank will give away the power to control currency. Btw, Temasek has joined FB libra2.0 project as they willing fo pegged to fiatcurrency.

    1. Retail & hospitality will show further weakness. Now impact not felt bcos of govt support n lock down. It’s a matter of time where pple feels the pain n lawyer letters will be everywhere into 2021.

      Did a chk. Wow bond yield is v low for sgs n ssb! SSB 100% liquid. I bought several yrs ago 2.5-3%. Maybe chk bank acct which gave me 2-3% yield w bills, salary, spending tagged.

      Mostly physical metals. 20% gold now n rest silver. Sold paper gold after crash to hv more cash. Have paper silver in UOB acct. Mostly silver in silver bullion storage vault. Storage fees is hefty.

      Should hav buy more physical gold in the past, smaller n easier to store!

      Agree Crypto in money form is unpredictable. More like speculation hence I sold. Blockchain technology is the future, but cannot find listed co except IBM.

      For now, I m doing nothing much in investment except blogging. Keep cash, keep liquid bonds.

      Above all, keep fit n healthy w loved ones! 🙂

    1. Bought my gold from bank. silver from silver bullion bcos they are the largest silver bullion in town.

  4. A broker of May bank Kim Eng also comment that HSI / S&P 500 is much better than STI. S&P 500 capitalisation is spread much evenly among high tech and high growth companies than STI.

    1. Yup, S&P is also good! But for Singaporeans, still ok to start from STI then transit!

  5. Hi Rolf,

    Hope you are keeping well!
    Thanks for another insightful post, I have been following your blog and always learning from your informative thoughts.

    I truly believe in investing into the US market which i just started a few months back to diversify my portfolio. Currently holding 80/20 (SG/US) respectively. US being IWDA to reduce WHT.
    If we truly want to invest into DJI/Nasdaq-100, are there ETF which allows SG investors to reduce WHT?


    1. Hi John,

      Tks for your compliments. WHT cannot be avoided unless some stocks domiciled elsewhere like Ireland or Shell in Netherlands. For US, focus on growth of the stocks as capital gains no tax.
      Otherwise go to HKSE. Better to check annual report on taxation! Too many funds.

      Do your own diligence.

      SPDR Dow Jones Industrial Average ETF (DIA)

      Nasdaq QQQ – https://etfdb.com/index/nasdaq-100-index/

      SPDR S&P 500 ETF Trust (SPY)
      iShares Core S&P 500 ETF (IVV), Vanguard S&P 500 ETF (VOO),


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