Dollar Cost Averaging (POSB Invest-Saver & OCBC BCIP)

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.

REITs meltdown & what it means

Ever since the recent REITs meltdown/sell-off, prices of some REITs have fallen below their NAVs & are now more attractive than ever. When REITs share prices fall, their yield on cost increases in favor of income investors. Bank analysts feel that the market is over-reacting & I think so likewise. As I adhere to the saying of "Happiness is best experienced when shared", I have decided to share my personal watchlist in this current bearish market which I think wont last for long. Please bear in mind that I consider myself as a long-term investor & I'm investing mostly for stable income from dividends with capital gains being my 2nd priority. I prefer to invest early in life, letting time do the magic of compounding effect & I will accumulate when I feel that yield is attractive. 

"The rich invest in time, the poor invest in money" - Warren Buffet.

Saizen REIT (Japan Residential)
current price 0.176 (down 25% of 52wk high value)
current yield at 7.5%

Lippo REIT (Indonesia Retail)
current price 0.480 (down 17% of 52wk high value)
current yield at 7.4%

Religare Health Trust (India Healthcare)
current price 0.845 (down 15% of 52wk high value)
current yield at 9.35%

OCBC bank analyst even highly recommend Starhill Global REIT (0.870, yield 5.5%) for its growth potential, strong fundamentals and compelling valuations. Futhermore, Starhill very recently renewed rent with Toshin Developement. Suntec REIT seemed to have lost its charm & fallen out of investors favor plunging to 1.640 with higher yield now at 5.5%. I certainly dont think it's rational for Suntec's plunge at all but Mr Market is far from rational. DBS bank analyst are still recommending Perennial China Retail Trust (0.570, yield 6.7%). To be honest, the current meltdown has made me a little gloomy but when I look futher into the future, I feel comforted as I know my investments are not darts thrown in the dark but rather are sound investments that have the potential to grow long term. With that, I hope most of you arent panicking in this recent meltdown but instead are on the look out for the best bargains.