Recently, 2 banks in Singapore have presented 2 new investment vehicles for individuals keen on investing in Singapore Blue Chip stocks with small amount of capital outlay monthly.
POSB Invest-Saver & OCBC BCIP (Blue Chip Investment Plan) allow individuals to have access to blue chip stocks from as low as $100/month. Dollar cost averaging is one of the methods of investing & those who are unfamiliar with it, you can look it up on Investopedia (Dollar Cost Averaging). For those who are already saving diligently every month & have no intention of utilizing the cash for the next few years might wish to consider signing up for this. POSB Invest-Saver helps you to invest in Nikko AM Singapore STI ETF as does OCBC BCIP but OCBC BCIP have the option of allowing you to invest solely in any of the 30 individual stocks that make up the Nikko AM Singapore STI ETF. I would recommend going with the STI ETF instead of choosing an individual stock as it's definitely more diversified with possibly lower volatility and risk ( Dollar Cost Averaging with ETFs. ) The STI ETF has been giving investors a compounded rate of return of about 5-7% annually for the past few decades (excluding 2-3% dividends) with principal amount usually intact.
Personally, I'm setting aside approximately 20% of my future income for this method. Instead of "timing the market", a bit of cash into "time in the market" might help keep my overall portfolio a tad bit healthier. I hope this post will help those who are new to investing. It doesn't require an individual to have a trading or a CDP account hence, this is very friendly to new investors.
Both banks charge differently on commission for each monthly transaction. For amount less than $500, i would suggest going with POSB Invest-Saver. Any amount above $500, going with OCBC BCIP will be better. Do look up the different commission rates on the respective bank websites.
