Singapore-based financial blog that aims to educate people on personal finance, investments, retirement and their Central Provident Fund (CPF) matters.

Wednesday, 22 November 2017

What type of mortgages are people getting?


2017 has been a rather bullish year for Singapore’s residential property market, with a healthy number of transactions over the past few months. As the number of transactions increases so does the number of mortgages. As such, if you wonder what kind of mortgages are people securing in this bullish market, here is the article for you.

Mortgage preferences
Singaporean mortgagees generally tend to depict a conservative approach in the mortgages chosen, loving the word ‘fixed’. In the first half of 2017, fixed deposit mortgages constitute of 74.5% of all mortgage types obtained; a huge market share. This followed way behind by fixed mortgages that represent 19.5% of the total mortgages. Board and SIBOR/SOR rates are significantly less, representing at 3.2% and 2.8% respectively.

Number of properties owned
First-time buyers or homeowners represent a majority share of the mortgagees at 63.7%. The existence of the Additional Buyers Stamp Duty (ABSD) is seemingly effective, as those owning 2 properties followed behind at 30.8%, while collectively those with 2 or more make up merely 5.5% of mortgages.

Age Dynamics
Contrary to the previous statistics, the market shares for the age profiles of mortgage applicants represent a close fight, with 32.7% making up of those aged 41 to 50 years old, 31.9% constituting of those 31 to 40 years old, and 27.2% making up of the older generation aged 51 years old and above.

Nevertheless, it is imperative to note that majority of those aged 31 to 50 years old are home upgraders. This may be partly due to the fact that first-time homebuyers generally turn to HDB loans, however, with stronger financial standings along the way, HDB upgrader turn to bank loans which offer attractive interest rates.

Gender Dynamics
Gender-wise, a majority are men with 56.8%, while women make up the remaining 43.2%. Several reasons can be attributed to this numbers, be it the fact that men are generally the sole breadwinner or the fact women tend to be conservative investors as compared to men. Nevertheless, we can expect this gap to further narrow in the foreseeable future as more women make property investments as a result of their growing significance in purchasing power.

Reasons for Mortgages
Our findings depict that there are more people seeking to refinance their loans as they seek to capitalize on more attractive packages, as indicated by the fact that 60.9% of mortgages are for refinancing purposes, an increase from 58% on a year-on-year basis.

Property types
Most of the properties mortgaged this year make up of condominiums, constituting 71.1% of all mortgages. This is significantly higher than HDB of 23.2% and landed properties of 6.6%. The reason being is the fact that generally HDB flat homebuyers tend to seek HDB loans. Simultaneously, the private residential market has been heating up as well.

Banks of Choice
Standard Chartered Bank, making up 28% of the mortgages, was the most favored bank in the first half of this year due to their appealing promotional rates. Nevertheless, OCBC is second favorites while Bank of China, DBS, UOB, and Maybank are close market competitors as well. You can check out a detailed list of mortgage interest rates.

In conclusion, should you require any advice on mortgages, it is best to contact an established mortgage advisory company such as Redbrick for assistance. On that note, you can also check Redbrick’s blog for any further useful tips and insights.


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Thursday, 5 October 2017

Save Money in Singapore Savings Bonds or CPF?


The Singapore Savings Bond (SSB)
It is a special Singapore Government bond, issued by the Singapore Government and sold to the public as a form of savings.
Introduced as another form of investment and savings plan for people living in Singapore

The Singapore Central Provident Fund (CPF)
It is a compulsory savings plan for all Singaporeans and PR living and working in Singapore.
A portion of an individual's monthly income is channelled into their respective CPF accounts for different purpose; for buying a house, for retirement and for medical expenses,

Differences between CPF & SSB
Differences CPF SSB
Withdrawal No
Each year, you can only contribute to your CPF at max $37,740 - inclusive of both your compulsory contribution and your voluntary contribution.
Yes
You will get back the money next month
Contribution/
Investment Limit
Yes
Each year, you can only contribute to your CPF at max $37,740 - inclusive of both your compulsory contribution and your voluntary contribution.
Yes
You can buy at max $50,000 worth of bonds each month.
Holding Limit No
You can save as much money as you like in your CPF.
Yes
You can at max own $100,000 worth of bonds in total
Interest Rates Up to 3.5% on your Ordinary Account
Up to 5% on your Special, Medisave & Retirement Accounts (SMRA)
Up to 6% on your SMRA if you are above 55 years old
Interest rates are fixed
Less than 1% in your first year
Increases every year
Reaches 3+% in the 10th year
Interest rates depend on market conditions.
Interest Compounding Non-Compounding
ReturnsBeats Inflation
With inflation on average of about 3% per year compounding, CPF's SMRA account provides higher interest rates than inflation, meaning you do not lose your purchasing power over time
Probably will not beat Inflation
With an interest of 2+% per year over the long-term, it is less likely for SSB to beat inflation rates.
You are likely to maintain purchasing power or lose a little to inflation
PurposeSave for long-term
Save for Retirement
Save for medical expenses
Save for home payments
Save for short-term
Save for an expense that will occur in a few months or years time, like a wedding, or home down payment

Recommended Post: How to Save Money Each Month – 76 Easy Things You Can Do Right Now

Similarities between CPF & SSB
Similarities CPF SSB
Guaranteed Principal By the Singapore Government,
one of the remaining few AAA-rated countries.
Confirm can repay you back the money you put/save with them
Guaranteed Interest  By the Singapore Government,
one of the remaining few AAA-rated countries.
Confirm can repay you back the interest you have earned
Ownership It is your money, whether in CPF or in the Bonds,
the money is still yours
Risk Level Low Risk, or No Risk
By the Singapore Government,
one of the remaining few AAA-rated countries.
Confirm can repay you back the money you put/save/earn with them

Conclusion:
If you want to save for the long-term, go with CPF. It pays a higher interest over the long-term and ensures that your itching hands will not be able to squander it away.
But if you are just looking for a place to save before spending it (say on your home down payment), then save with SSB, it is less risker and provides a good enough interest to ensure you do not lose too much to inflation!

Recommended Post: How CPF Provide 5 Insurance to You

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Monday, 11 September 2017

SGX Bull Charge Charity Run 2017

Join us at this year's annual SGX Bull Charge 2017.
It is an annual Charity Run hosted by SGX to rally the financial community as well 
as the SGX listed companies to come together and contribute back to the society
Contributions from these organisations enable beneficiaries like the Community Chest, 
Autism Association Singapore (AAS) and many others to deliver better care and assistance to those in need. 
There will also be movie screening, popcorn, food truck, live perforamnces and more!

Date of SGX Bull Charge:
Friday, 17 November 2017
4.00pm to 9.30pm
F1 Pit

This year, InvestmentStab is privileged to be able to participate in such a meaningful event. 
To show our appreciation to our readers, we are offering 10 of our readers complimentary tickets to the event!
Simply email us your full name and email by this Wednesday 23:59.
You can Facebook message us at InvestmentStab
Instagram message us at InvestmentStab
Or even email us at InvestmentStab@gmail.com
Tickets are on a first come first serve basis.

For more information on the event, you can refer to the official website: www.sgx.com/bullcharge
If you would like to donate to the cause without participating in the run, you may do so too via the link above.
We hope to see you there are the SGX Bull Charge Charity Run 2017.



Thursday, 7 September 2017

How CPF Saves You 5 Insurance Plans

Have you ever thought about CPF as more than just a scheme to lock Singaporeans' money?
There could be a lot more to it if you dig deeper - like really deeper.
There is a reason why most financial advisors actually advise you to keep your money with CPF.
Not because CPF pays them, but because CPF as a scheme is quite good - except the part where you cannot withdraw money as and when you like.
Instead of looking at the CPF Retirement Sum as a target where you can withdraw money after a certain age, look at it as a Savings + Medical + Life + Home + Annuity insurance plan.

Savings Insurance
It helps you save up money for housing, medical, kids' education, and retirement.
The "forced to contribute" part ensures that you really save your money every month.
The "cannot withdraw" part ensures that you do not anyhow withdraw this money to spend it.

Recommended Post: Save with CPF or Save with Fixed Deposits?

Medical Insurance
We have got Medishield Life, Eldershield, and other medical insurance schemes that are paid by the Medisave Account.
Medishield Life covers you regardless of your age or pre-existing conditions.
Most private insurance will not cover your pre-existing conditions - if you have asthma since young, chances are you are not going to be insured for it under your private health insurance plan.
However, it will be covered under Medishield Life.

Life Insurance
In the event that you passed away, all your CPF money will be passed to your dependents. 
If you had bought the Dependents' Protection Scheme (DPS) for yourself, in the event of you passing away or becoming mentally or physically unable to work anymore, you will receive an insurance payout of $46,000.

Home Insurance
There is also a Home Protection Scheme (HPS), a housing insurance that will pay your mortgage in the event that any mishap falls on you and result in you no longer able to pay your mortgage.
If you are paying your HDB loan using your CPF savings, it is mandatory for you to purchase the HPS.
However, the monthly premiums are paid through your CPF - you save cash.

Annuity Insurance
An annuity is an insurance that you pay premiums to an insurance company every month, and in return, when you reached a certain age (usually retirement age), the insurance company will pay you a fixed monthly payout for as long as you live.
However, if you die early/young, the payouts will stop, which is not worthwhile if you paid 20 years of premium and took only 10 years of payouts.

When you reach 55, CPF automatically enrols you for CPF LIFE, which is an annuity plan that pays you a fixed monthly payout when you reached the retirement age (65).

However, it is better than just an annuity plan. In the event that you passed away before fully utilising the funds in your CPF LIFE, the unused money (the whole sum) will be passed to your dependents just like a Life Insurance. This feature is usually unavailable for most annuity insurances.

Recommended Post: Yes! CPF takes 20% of your salary, BUT...

And that is the 5 insurances CPF provides you with.
Are there any more that you can think of?
Share with us!
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Friday, 18 August 2017

Save with CPF or Save with Fixed Deposits?

This post will contain a tip on how to increase your CPF returns, namely in the form of interest.
One way to earn more interest from CPF is to transfer your extra money, into your CPF Special Account.

The choice between CPF or Fixed Deposits is determined by how much flexibility you want.

The less flexible the option, the higher the interest.
Your Ordinary Account (OA) currently earns 2.5%, Special Account (SA) and Medisave Account (MA) earns 4% interest while your normal bank Fixed Deposit (FD) earns less than 2% annually.

Recommended Post: Yes! CPF takes 20% of your salary, BUT...

If you want to be able to touch the money (to spend or to do other things), putting it in a Fixed Deposit ensures that you will be able to use the money when the situation arises. 
Of course, this would mean you will be getting a lower interest.

But if you are confident that you do not want/need to touch the money and would like it to grow faster, depositing it into your CPF account makes sense and cents (many cents).
In addition, you will get tax relief if you top it up into your SA or Retirement Account (RA), which reduces the amount of tax you pay, double win!
The interest on your SA is double that of your FD. This works even better as you get older and approaches 55 because you are closer to the age you can withdraw money in your CPF accounts.

Real Life Example:
My mum is 48 this year. She wanted to buy a 10-year Fixed Deposit which gives less than 3% per year. I suggested that she put her money into her CPF to earn the CPF interest.

Based on her current age, she can put $7,000 into her SA and earn a 4% interest. She will be able to withdraw $5,000 when she reaches 55 years old in 7 years, or any amount in excess of her Full Retirement Sum (FRS).


Of course, if my mum fails to meet her FRS, the money that goes into her CPF will not be returned to her at the "end of the maturity" - instead, she will get it as future monthly payouts via CPF LIFE.
But there will be other factors to consider and there will be ways to withdraw the money out, which will be explained in future posts.
Recommended Post: If Li Ka Shing was 20+ years old now, he would....

All in all, if you wish to have a higher interest rate than Fixed Deposit and risk-free, you can consider putting your money into your CPF, especially if you are near 55 years old - where the risk-return profile is more skewed in your favour.


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Thursday, 6 July 2017

So many styles but which style?!


As times change, the markets change together with it as well. This is due to the forces that shape human behavior have changed and influences how people interact in the markets. From fundamental analysis to technical analysis, to leveraged trading such as contra trading, to computerised trading such as quant trading. With so many trading strategies and techniques in play, the question now is: Which is the one that is most profitable?

While most people are pre-occupied with just profits, it is far more important to know which trading style is suitable for your personality and risk tolerance. If you are comfortable using a strategy and are disciplined enough to stick to it, trading success will also follow.

Hence, the first step is to find your winning strategy. Getting to know all the various strategies, their advantages and risks. It is important to obtain and read as much resources as possible to widen the possible trading or investing tools that you can use to enhance your trading style. It can be through books, online resources, seminars or even through back-testing of your own formulated strategy. It could also be the case where not just 1 strategy is suitable, but rather a hybrid of 2 or more. Personally, I use fundamental analysis to identify potential investment options with viable target prices while using technical analysis to better time my entry and exit points.

Exclusively for our readers, we are glad to broadcast that ShareInvestors will be having a seminar by Ronald K, who is a self-made millionaire in the Stock Market. He will be introducing the Contra Squeezing strategies and trading using tick charts. Tick charts are just another way of presenting trading prices in charts, similar to line and candle charts. This is up to the preference of the traders using it as different charting styles present and focus on data differently. Ronald will also be introducing a risk management plan that is specifically for the Contra Trades.


Remember: Wealth is not about the money, it is about the options that it gives. Having more options to earn money will then generate more wealth.

Wednesday, 28 June 2017

WOOFR: Your Lifestyle Passport to Clubs, Bars & Music Events

What sort of applications and revelations does your platform bring about?

WOOFR is your lifestyle passport. Within a few taps on your smartphones, we bring you instant bookings and exclusive deals to your favourite clubs, bars and music events.




What inspired this business idea?
I’ve travelled regularly as a DJ, and I’ve seen so many pain-points in the nightlife space. It’s such a hassle for tourists to discover the best nightlife spots, and the language barrier makes it even harder to book a table or purchase tickets to the venue.
Nightlife venues themselves are still running on traditional methods of reservations (pen and paper), and they are unable to retain data analytics of their consumers such as the name, age, nationality and spending history.

More about WOOFR:
Facebook: @thewoofr
Instagram: @woofr_app
Website: thewoofr.com

This article is contributed by The Ventured.
We uncover and bring to our readers the success stories of entrepreneurs and also the hardship and hustle behind each of these success stories. Through these, we aim to foster strong entrepreneurship driven community and ultimately we wish to provide a one-stop solution in terms of guidance for our community. 

Facebook: @TheVentured
Insta: @the_ventured
Twitter: @The_Ventured

Tuesday, 13 June 2017

What you are missing out that the institutional investors are doing

19:37 No comments

As retail investors, we often perceive ourselves or by others as inferior investors that are incapable of obtaining superior returns as compared to institutional investors. This is partly due to the pre-conception that institutional investors are more sophisticated and knowledgeable where they can utilise complicated strategies with confusing instruments. However, with more and more articles that emphasized the ineffectiveness of active institutional funds and how passive funds are outperforming active funds, you may be swayed towards believing that active funds are lacking.

So how do we, retail investors who want to take on a more active investment approach, do to outperform the market benchmarks? 

Given their long establishment and experiences, active institutional funds do have established processes and frameworks that retail investors can exploit to improve their chances. 

1. Efficient employment of capital

Institutional investors often have large amount of capital. To maximise returns, it is also prudent to manage and ensure that a comfortable level of capital is employed for the purpose of earning returns. Evaluation of options to determine returns so as to effectively utilise capital is also important. Depending on choice of asset classes, level of capital usage also varies. From personal experience, in trading forex, 60-70% of capital should be employed consistently to ensure efficient use of capital to generate returns. Comparing to other asset classes like equities, this may be low but given the high leverage nature and buffer for margin calls, this would be sufficient. 

Just based on simple logic, by having most of your capital consistently employed and utilised to earn returns ensures a higher chance of out-performance.

2. Recording your investment thesis and reviewing when necessary

Institutional investors often record their investment thesis when they invest. This is important for the management and continuity of the investment strategy where new employees can easily understand and takeover an existing portfolio based on various reasons for investment. Another important step is to review the investment only if there are material changes in the investment scenario or market. Unlike retail investors, they are less likely to be impacted by daily price movements, which are erratic and random. This could be also possible due to the bureaucracy layered in an organization where it takes slightly longer than individuals to evaluate and make decisions. This is then one advantage of retail investors where we are more nimble and sensitive to capture investment opportunities. This means that we are able to get in at favourable prices. The tough part is, hence, to differentiate from the noises of the market (daily price fluctuations) and sticking to your investment plan.

From personal experience, all these noises are often the ones that distract me from the ultimate underlying price that I have for a specific investment. The market will often try hard to force you to move your positions and fake you out before moving exactly in the way you predicted. Thus, it is important to be able to differentiate what change is material enough for a change in investment stance.

3. Having co-investment officer
We could see that there are multiple successful funds that have 2 leaders to dictate investment strategies. Examples are PIMCO, KKR. Contrasting this to traditional leadership models where one individual will make the overall decision for direction. From personal experience, by having another investor that understands the overall investing strategy, it helps to keep one another in check for emotions such as greed and fear, as well as to promote accountability in managing other's funds, there are more detailed thought process in both investors before committing to a decision. Discussions are also conducted to discuss future strategies and evaluate investment options. 
Beside these techniques, what are the other ways you try to increase your investment returns? Share it here!


Friday, 9 June 2017

If Li Ka Shing was 20+ years old now, he would....


There was an article in the past that went viral.
It talked about the advice given to young people by Hong Kong's richest man - Li Ka Shing.
In the article, he talked about splitting our pay into 5 parts, each for a different purpose

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30% - Living Expenses, paying for food etc
20% - Socialising, paying off phone bill + creating connections
15% - Learning, buying of books or signing up for courses/training
10% - Travelling, going overseas once a year to broaden your horizon
25% - Invest, SAVE to INVEST or start a Small Business

He used a guy earning RMB 2,000 (roughly SGD $400) as an example of how to split the money.
His example is for people living in Hong Kong or in China.
In my perspective, there are some parts I think we can change to suit it to Singapore's context.

The allocation below is for a Singaporean whose take home pay is $1,500 after CPF deduction.
Some adjustments were made to the allocation and I do not recommend following strictly to the guideline because every individual is different and every month is different.
If you spend more on 1 month, make sure to balance it back the other month.
I think a little flexibility in the allocation is okay, but not too big a difference, less than 5% movement range for each category.
But do try and keep the last part (INVEST) intact or increase if possible, because that is for the future, YOUR FUTURE!

55% ($825) - Living Expenses, paying for food, transport etc (a)
10% ($150) - Socializing, paying off phone bill + creating connections (b)
10% ($150) - Learning, buying of books or signing for courses/training (c)
10% ($150) - Travelling, go overseas once a year to broaden your horizon (d)
15% ($225) - Invest, SAVE to Invest or start a Small Business (e)

Recommended Post: Yes! There is interest on your CPF Housing Grant, BUT...

a) The unfortunate part of not earning much is that a huge portion of our pay goes into necessities, rendering us with minimal for other things.
Items like groceries, utilities, meals etc often take up a huge portion of our pay.
Find ways to cut cost and keep them within the 55% budget!
DO NOT OVERSPEND!

b) Li Ka Shing advises us to treat 2 people who are able to help us in our career to a meal each month. Allocating about 3% of your pay to treat each person sounds reasonable. And hopefully, if your phone bill is not too expensive, it would probably be less than 5% of your pay

c) Singapore's National Library has got a good variety of books, thus there is not really a need to buy books. Save that money for other use, go to the library to borrow more books to read and learn.
There are also currently a lot of e-courses online that are free, some even available via YouTube. Do make use of these sites to learn and save on the learning expenses.
Of course, if a certification is required, then go for the paying courses that provide certificates.
The government is also providing a $500 subsidies for qualifying courses, make good use of it!
Money saved here should go to the 'Invest & Save' portion

d) Depending on your income, travelling every year might not be possible, unless it's to neighbouring countries. Either it is travelling every 2 years OR you could roll over your money to the Invest or Learning portion.

e) Read up on basic investments, long-term investments. Read up on our post on investment under our 'Investment' tabs to learn more!

Remember to offer your opinions. If you don't put your two cents in, how can you expect to get change?

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Wednesday, 7 June 2017

Singapore embraces Gender Diversity, but her Home Companies seems not...

How many female directors are there in Singapore's top 10 public companies?
While the number of female directors around the world is increasing, is the number of female board of directors in Singapore increasing?

Recommended Post: Yes! CPF takes 20% of your salary, BUT...


As we embrace gender diversity, should we start pushing for more female directors on our public companies' boards?
Especially when 3/10 of the companies have 0 female directors on their board.

Recommended Post: Yes! There is interest on your CPF Housing Grant, BUT...

Remember to offer your opinions. If you don't put your two cents in, how can you expect to get change?

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Sunday, 14 May 2017

Yes, CPF takes 20% of your Monthly Salary, BUT....

A lot of people have the misconception that the Central Provident Fund (CPF) takes away 20% of your salary every month.
While that is true, there is more to that than just what it seems like.
There are a few things you should know about this 20% "pay cut".

Recommended Post: Singapore Retirement, Re-Employment, CPF Withdrawal Age

1) The amount that you give actually decreases as you age
At the start, your contribution rate is 20% of your monthly salary
As you grow older, the percentage of your salary CPF takes decreases.
Source: CPF Board

2) There is a cap to your salary contribution!
Yes, there is a limit to how much you can INVOLUNTARILY contribute to your CPF.
Currently, the limit is set at $6,000.
If you earn $6,000 or less, your contribution rate is 20%. Meaning you only contribute $1,200 to your CPF.
However, if you earn more than $6,000, you are only required to contribute base on $6,000.
If you earn $10,000, you still only need to contribute $1,200 into your CPF. There is no need to contribute 20% of your extra $4,000 salary into your CPF (although you could if you want to).

3) Your Employer also contribute to your CPF
Your employer contributes 17% of your salary into your CPF.
This means you are actually getting an extra 17% of your salary - but it goes into your CPF.
This 17% is also cap at a monthly salary of $6,000, similar to your own contribution
If you earn $6,000, your employer contributes an extra $1,020 into your CPF (17% x $6,000)
If you earn $10,000, your employer also still contributes an extra $1,020 into your CPF.

4) If your salary is below $750, your CPF Contribution is Different from others
If your monthly salary is below $750, your CPF contribution percentage is different from the normal CPF contribution rates
Source: CPF Board

Recommended Post: Yes! There is interest on your CPF Housing Grant, BUT...

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Friday, 14 April 2017

Hu Li Yang Gravity Line Investment Strategy


Hu Li Yang 30 Stock Investing Strategies
胡立阳投资股票三十招

What is a Gravity Line? 什么是地心引力线?
A stock's Gravity Line is the average between its 30-day moving average and 72-day moving average.
Gravity Line = (30-day SMA + 72-day SMA)/2
Why this weird number?
I have no idea, it was mentioned in HLY's book that he researched about it and found these 2 numbers gave the best results
一个股票的地心引力线是它的 (30日移动平均价 + 72日移动平均线)/2

Use of Gravity Line? 如何利用地心引力线投资?
1) When the stock price falls to 20% below Gravity Line and
2) Stock Volume greater than the average volume for the past 5 days
This is a signal that the falling trend has reversed and it is time to buy.
This means that the stock is heavily undervalued and the spike in volume could mean that someone has spotted this and is buying into the stock.

1)当股价已跌到低于地心引力线至少 20%
2)当天的交易量高于前5天的平均交易量
这是一个买入的信号。这代表股票已跌倒谷底,有行家正在大量买入,这是这股票将反弹的征兆。

What is a Taser Line? 什么是高压电线?
This is a price line that is 20% above the stock's Gravity Line
Taser Line = Gravity Line x 120%
A stock price that falls below this line tends to continue falling.
一个股票的高压电线是它的(地心引力线 x 120%)
当一个股价已从高于高压电线的价格区跌过它地高压电线,这代表这股票将会持续下滑。


Use of Taser Line? 如何利用高压电线投资?
1) When the Taser Line starts to go flat and
2) The stock price fall below the Taser line
This is a signal that the rising trend has reversed and it is time to sell.
Description: The stock price hits the Taser Line (because it rose too fast), hence it needs to fall back a little (attached by the Gravity Line below it)

1)当高压电线开始走平
2)股价从高于高压电线的价格区跌过它地高压电线
这是一个卖出的信号。这代表股价已到了最高点,开始要下滑了。

Wish to learn more techniques from the Master himself?
Join him in his upcoming seminar in Singapore!
想多向大师学习吗?机会来了! 胡立阳将在新加坡举办一场讲座会。

Hu Li Yang Investing Seminar 2017
胡立阳投资讲座 2017

Learning Points:
1) Is the current market condition suitable for investing or should I wait?
2) What techniques should I use if I wish to invest currently or in the future?
3) What strategies does Mr Hu use that I can use?
4) What temperament should I possess in order to succeed in the stock market?

Speaker: Mr Hu Li Yang (胡立阳先生)
The Godfather of Asian Stock market, Hu Li Yang, is back in Singapore to share with us his view on the investing opportunities and risks in year 2017! Spend 1 full day learning from the Man himself as he would discuss his views and how investors should position their portfolio for the rest of 2017!

Mr Hu previously held the position of Vice-President of Securities in Merrill Lynch in the 1980s, then the biggest securities firm in America. In 1986, he gave up his high paying job and return home to Taiwan to develop and educate its people on investing in the stock market. Since then, he has been regarded as the 'Godfather of Asian Stock Market' and has gone on to published best-selling books on stock market investing.

He accurately predicted that:
1) the Dow Jones Index will rebound on 2009 March,
2) the Taiwan stock market will exit a bear market on 2009 November,
3) Gold's temporary peak on 2009 December,
and many more!

拥有 ‘亚洲股市教父’ 和 ‘故事神童’ 职称的胡立阳回来了。在这次的讲座中,胡立阳将与你分享他对未来一年股市的动向和如何从中赚到钱。 除了与胡立阳老师有近距离接触之外,你也将学到他花了毕生心血专研出来的股票分析技巧和手法。

胡立阳曾是美林证券行的第一位华人副总裁,在 1986 年,他放弃了在美国的高薪职位,返回了台湾,并大力地推广台湾投资热潮和教育人们如何投资。从此以后,胡立阳就得到了 ’亚洲股市教父‘ 职称,也成功了推出很多关于投资的书。

胡立阳曾经成功的推测出许多股市中的低谷与高峰,比如说,2009年道琼斯和台湾股市从低谷反弹起来,2009年黄金价格已达高峰等。

Event Details:
Date: 8 April 2017, Saturday (4月8日2017年,星期六)
Location: Maybank Kim Eng 48 North Canal Road, Singapore 059305
Time: 10.00AM  6.30PM (registration starts from 9.30AM)
Price: $688 (U.P. $738)
The seminar will be conducted in Chinese

Click HERE to sign up for the event!
想参加这讲座会的请安这

Limited Seats Only! Sign Up Now!

Monday, 10 April 2017

Why is it call a Bull Market and a Bear Market?


Ever wondered why is a dropping market call a bear market and why is a rising market call a bull market?
There is no 100% confirmed story, but the one we present below is one that has been highly circulated over the years.
Apparently, it has something to do with the bears and bulls attack their prey.
Think for a moment how these animals attack their prey.

Recommended Post: Singapore Retirement, Re-Employment, CPF Withdrawal Age

Bull Market
How does a bull attack its prey?
It charges at it, the uses its horns to thrust its prey up.
The prey getting swing upwards is similar to a rising stock market - upwards

Bear Market
How does a bear attack its prey?
It swings its 2 arms down at the prey.
The prey gets hits downwards, similar to a dropping market - downwards

Yes! This is true!
You can Google why is it call a bull or bear market, or we can save you the trouble and you can read it from Investopedia

Recommended Post: Yes! There is interest on your CPF Housing Grant, BUT...

Remember to offer your opinions. If you don't put your two cents in, how can you expect to get change?

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Monday, 3 April 2017

Active or Passive Way of Investing?

Active Investing versus Passive Investing

This is the battle that is happening on Wall Street since 1975 when John C. Bogle started the first fund company, The Vanguard Group, in the United States (US) offering to mom-and-pop investors low-cost index funds that aim to mimic the US index returns and charge extremely low cost for it (like 0.1% of the asset per year).

Before 1975, active trading (or active fund management) was the only thing available to investors who wished to get someone to managed their money. These active funds seek to achieve above market returns for their investors, and in return they charge high fees (from 2% to 20% of the profits per year).

At the beginning, everyone was skeptical of the idea of an Index Fund, because it gives investors only market returns, not spectacular returns above the market rate. People are greedy and just cannot take it that they are going to get average returns. They want the big returns that active management promises.

Fast forward to 2017 today, 42 years since the first US index fund was launched, we have more than 1000 index funds in the world tracking different indexes, excluding index ETF that trades on the stock exchanges. Funds managed by these passive investment products/tools surpassed the amount managed by the actively-managed investment funds - investors are pulling funds out of these funds fast and investing them into index funds. This happened because the active funds are no longer able to provide above market returns after cost. It is becoming better to be average than to be sub-par.

However, that is not to say that active investing is dead. While many have failed, there are also those that have succeeded and are still doing relatively well. George Soros, Carl Icahn and Warren Buffett are just some examples of people who did really well actively investing their money.

What is Active Investing?
Active Investing means actively looking for good companies to invest in, hoping that it will perform better than the market and hence earn you a higher return. You can do this yourself or by hiring a professional money manager to do the job for you.

Basically, you are looking at all the stocks in the market and looking for undervalued companies to buy or overvalued companies to sell short. Instead of buying the whole market and achieving average returns, you hope to get above market returns by identifying and buying those companies that will outperform the average.

What is Passive Investing?
Passive Investing means passively investing your money in buying the entire market via an index (think S&P500). You do not care how each stock performs and you do not really care which company makes it into the index and which are dropped. All you need to know is that over the long term, the stock market is and will go up and that your money will grow with it - just not at an above the market rate.

You can do this yourself manually, buying up all stocks in the index in the proportion of their market capitalisation (you have to be very very rich to do that) and re-balance it yourself every half year or you can just invest in an index fund that is managed by a group of professional managers who charge really low fees (because they don't really need to do much except re-balancing the fund every half year).

With Passive Investing, you are not trying to find the needle in the haystack, you are buying the whole haystack. Instead of looking for a really good company, you buy all the companies because the majority of them are going to do well that they will cover the bad ones and also make you good returns.

S&P500 price chart from 1950 to 2013
Are you now slightly convinced that Passive Investing works?

What are the differences?
Personally, these are the difference to me

Active Investing VS Passive Investing

Active Investing (Self)Passive Investing
Monitoring Consistently monitoring of
stock performance

See at the start and close of the
market OR
don't even look at the market at all

Strategy Research, buy, then sell when
the time is correct

Buy and hold until you need money
then you sell

Aim
Beat the market before cost
Beat the market after cost

Get market returns before cost
Less than 1% below market returns
after cost
Lifestyle Quite stressful, especially if
you are losing money on
your positions

Sleeps like a dead log because over
the really long-term, you know your
money will grow

Fees
Incur lots of trading cost
If you are investing with a
fund, they charge a 2% asset
management fee and a 20%
cut on your profits

Less than 1% of your assets' price
Effort
Have to do your own trading
research and analysis, hence
more effort

No effort other than finding a low
cost index fund provider

Which do we suggest?
I would like to quote from a famous fund manager Kenneth L. Fisher, who have written many New York Times Best Seller Investment Books: "Active if you know what you are doing, passive if you do not!"
That being said, a lot of you will think that because I have read so much and attended so many courses, I will know what I am doing.
Not to rain on your parade, but there has been research that says that monkeys throwing throws darts at random stock tickers could actually outperform experts financial managers (I'm serious, you can Google it).

Active Trading vs Long-Term Investing

Peek into the minds of some of the great investors in Singapore and learn from them their investing style, their investment criteria, and their views on investing!

Learning Points:
1) Is active trading more superior or is passive investing more superior?
2) What techniques should I use if I am an active trader?
3) What strategies should I use if I am a passive investor?
4) What is the risk for each of the techniques and strategies I use?
5) How can I improve my techniques and strategies?

Speakers: 
Ronald K- Self-made millionaire investor
- Featured in Sunday Times twice for his approach to investing
Gabriel Yap - Executive Chairman of GCP Global
Kelvin Seetoh - Business Analyst of 81 Holdings

Event Details:
Date: 8 April 2016 (Saturday)
Location: MND Auditorium, 9 Maxwell Road, SG 069112
Time: 09.00AM  1.00PM (registration starts from 8.30AM)
Price: $10 

*Refreshments provided

Click HERE to sign up for the event!

Limited Seats Only! Sign Up Now!


Friday, 24 March 2017

Yes! There is interest on your CPF Housing Grant, BUT...

No, this is not another pro-government blog post. Neither is this another anti-government post. This is purely a post to make sense of the article posted by The Online Citizen.
The Online Citizen recently published a post called 6 things you weren't told about the CPF housing grant.
We thought that the content was really new and surprising and that spurred us to do our own research if it was true - especially in current times where fake news is rampant!
The Investollo team had done a great job dissecting the CPF Housing Grant, and you can read more about what they have written:  CPF Housing Grant Increases.
We recommend reading their article first before reading ours - just in case you are lost.

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We did some digging, consulted experts and people with knowledge of the whole process.
We present our findings below.

1) Yes! There is an accrued interest attached to the CPF Housing Grant that you will have to return TO YOUR CPF ACCOUNT if you sold your house. (In case you missed that point, re-read the part we put in caps).
There is an accrued interest attached to the CPF Housing Grant, but at the end of the day when you sell your house, your CPF Housing Grant Money and the Accrued Interest goes Back Into Your CPF Account(s).

2) It is really difficult to find any information regarding the CPF Housing Grant and its 'terms and conditions'. To be exact, there is no such page on the internet.

3) If you die, your dependents do not need to repay the CPF accrued interest you have accrued. However, if the surviving spouse used his/her CPF savings to pay for part of the house, the accrued interest accumulated on the amount that he/she withdrawn will still need to be returned to CPF upon selling the house.

4) You cannot withdraw the grant out as part of your withdrawal. They will remain in your CPF as part of the non-withdrawable amount. This applies to accrued interest earned in your Retirement Account and other money you top up into your CPF.
For more information on this part, read up on our previous post: Fine Prints of CPF Money Withdrawal.

5) Point 3 in the article from The Online Citizen, it is stated that the Housing Grant levies a 2.6% accrued interest on the Grant money. It is actually 2.5% - the prevailing CPF Ordinary Account interest rate.

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Conclusion:

The CPF Housing Grant is still free money from the Singapore Government to you. The accrued interest accumulated in your CPF Housing Grant still goes back into your CPF Accounts. While it may reduce the amount of cash you can get from selling your house, at least the money is still with you - just in an account that you cannot touch until you are 55 years old. Although the way that it is structured is not very ideal, it does not change the fact that it is FREE MONEY from the Singapore Government that we can use in the future.

Remember to offer your opinions. If you don't put your two cents in, how can you expect to get change?

Have a feedback? Tell us now!
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Thursday, 16 March 2017

What is Contra Trading?


Contra Trading, is the act of
1) buying a stock and selling it before payment date
2) selling a stock and buying it back before payment date

In Singapore, after a trade is executed, you have three working days before you need to pay the total cost of the stock.
If you buy a stock on Monday, you are only required to pay the total cost of the trade on Thursday.
However, in contra trade, you sell the stock before you are required to pay on Thursday.
You can sell on Monday, Tuesday, Wednesday or Thursday.
This effectively means you do not have to fork out a huge amount of money to pay for the stock.
In this scenario, you earn or pay the difference between the selling price and the buying price.

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Example 1: Normal Buying and Making a Profit
I buy 1,000 shares of ABC company at $3.00 per share on Monday.
Total I will need to pay $3,000 for these shares on Thursday (excluding brokerage fees)
On Wednesday, I sold the shares for $3.10 each.
I will earn $0.1 x 1,000 shares = $100 (excluding brokerage fees)
I earn $100, and I do not need to pay $3,000 for the shares that I have bought.

Example 2: Normal Buying and Making a Loss
I buy 1,000 shares of ABC company at $3.00 per share on Monday.
Total I will need to pay $3,000 for these shares on Thursday (excluding brokerage fees)
On Wednesday, I sold the shares for $2.90 each.
I will lose $0.1 x 1,000 shares = $100 (excluding brokerage fees)
I will need to pay to my brokerage firm $100 for the losses I incurred for the trade
But I do not need to pay $3,000 for the shares that I have bought.

Example 3: Shorting a Stock and Making a Profit
I sell 1,000 shares of ABC company at $3.00 per share (I do not own any shares previously).
Total I will take $3,000 in cash and I will need to delivery 1,000 shares of ABC (excluding brokerage fees)
On Wednesday, I buy back the ABC shares for $2.90 each.
I will earn $0.1 x 1,000 shares = $100 (excluding brokerage fees)
I earn $100, and I do not need to deliver the 1,000 ABC shares that I sold.

Example 4: Shorting a Stock and Making a Loss
I sell 1,000 shares of ABC company at $3.00 per share (I do not own any shares previously).
Total I will take $3,000 in cash and I will need to delivery 1,000 shares of ABC (excluding brokerage fees)
On Wednesday, I buy back the ABC shares for $3.10 each.
I will lose $0.1 x 1,000 shares = $100 (excluding brokerage fees)
I will need to pay to my brokerage firm $100 for the losses I incurred for the trade
But I do not need to deliver the 1,000 ABC shares that I have sold.

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Do note that although you are allowed to do Contra Trading in Singapore, there is an additional requirement if you are short-selling and buying back within the 3-day period.
You are required to "borrow" the stock you are short-selling from SGX (you need to have an account approved for short-selling) before you can short-sell.

Revolution to Trading Singapore Stocks 
using Contra Squeezing Techniques

Learning Points
1) How to perform contra trades using contra squeezing strategies
2) How to pick the right stocks for short-term trading
3) How to spot important entry and exit points for trading positions
4) Risk Management for Contra Trades
5) Sneak Peek into new category of Growth stocks

Speaker: Ronald K- Self-made millionaire investor
- Featured in Sunday Times twice for his approach to investing

Event Details:
Date: 25 March 2016 (Saturday)
Location: City Index Asia Pte Ltd, 6 Battery Road
Time: 10.00AM  3.00PM (registration starts from 9.30AM)
Price: $10 

*Lunch is provided

Click HERE to sign up for the event!

Limited Seats Only! Sign Up Now!

Free Mystery Gift
for the first 20 registrants