[Ask FH] How to build a balanced stock portfolio for Singaporeans – Part V


Taking the opportunity to respond to reader’s queries on portfolio building, investment advice, or anything finance related at all. I know I’ve been a bit slow on this one (some questions are from a month or two back), so my sincere apologies for that.

As always, if you have any burning questions on investing at all, drop me an email at [email protected] with the subject title [Ask FH], and I’ll respond to you personally via an article.

Note: I’ve tweaked/omitted some of the information below to protect the privacy of the readers. Accordingly, any resemblance with a person you know is purely coincidental. Please note that this article should not be construed as formal investment advice. If you are uncertain as to the steps you should take, please consult your stockbroker or a financial advisor. 🙂



Dear FH, 

I am an avid follower of your well written postings. Greatly appreciate if you could consider writing a review on this Bloomberg article (reposted by TOC). I am interested to understand what are resultant impacts for SGX and what can small retail investors, like us, do. Thank you. 



That’s a really interesting question. Personally I used to work in the capital markets industry, and my personal experience has been consistent with this article. The SGX is no longer a “sexy” exchange. If you’re a big company looking to list in Asia, there really is no reason to pick Singapore. The listing obligations are tough, the market valuations are poor, and daily trading volume is horrible. You could just go direct to Hong Kong and get a better valuation, while also being able to tap the China market.

For the SGX as a company, it’s not necessarily an existential crisis, because these days a lot of their trading volume comes from the derivative markets. So that’s the big cash cow for them, and that’s the one I would be concerned with if I were an SGX investor. That may change in the future though. If recent moves like the HKex trying to expand into China A50 futures are well executed and steal a chunk of trading volume, that’s going to be really bad news for SGX.

For small retail investors like us, the answer is simple. There’s no need to constraint ourselves to only Singapore based investments. The world is our oyster, and if the next Alibaba decides to list on the Hang Seng rather than the SGX, it’s really not that hard to open a new brokerage account (or use an existing one) and purchase the same stock on the Hang Seng. With the way the world is shaping out, I think any Singapore retail investor would be crazy to stick only to Singapore listed shares. The SGX is still the market leader in Asia ex Japan for REITs, and is strong for the 3 local banks and certain property developers. For everything else though, there’s always Hong Kong or New York.

What this means for Singapore as a country is a trickier question. I was at a seminar recently where a prominent China businessman remarked that one of the problems he foresaw with Singapore was the lacklustre equities exchange. It’s hard to be taken seriously as a global financial centre and wealth management hub when your local equities exchange is in a slow decline. The SGX and MAS are definitely taking steps to address this, but I have my doubts on how effective these measures will turn out to be. My suspicion is that to really solve this problem, it will require a coordinated effort from the government, MAS and Temasek, and even then we may never rival Hong Kong as an exchange.



Hi, Financial Horse,

I have questions pertaining to SRS. I am a 28 year old, and have SGD12000 in SRS, and I have done so to avoid the 11.5% tax rate chargeable for income more than SGD80000. In doing so, I have effectively received  a one off return of 11.5% for this year. However, withdrawal will be decades away.

I am looking to invest this sum. I understand that using SRS to buy shares/ REITs might not be the best idea, since it can get quite complicated when the company issues rights etc. In any case, I already have a fair sum invested with cash in stocks/ REITs. I am not currently considering unit trusts and insurance.

Therefore, my options left are:
a) SGS bonds
b) Stashaway- though I’m not quite keen on this.
c) Regular savings plans with POSB (either NIKKO AM STI ETF, or ABG SG Bond)- which I’m not quite keen on either as I am fairly invested in Singapore stocks/ REITS already.

I was wondering, if I were to invest this sum in multiple SGS bonds/stocks/ the others above along the way; and in the future, if I were to withdraw this sum, the money will return into the SRS account (is there any way to withdraw into another liquid bank account)? The dividends will also return into this same SRS account, if I’m not mistaken.

Any advice pertaining to investing this sum? I am open to temporarily dumping them in SGS bonds, and withdrawing to further invest in other higher yield options, though I am of the opinion that dividends sitting in the SRs account is quite the silliest way to grow. Perhaps growth stocks?

Thanks for your reply.


Hi there! Congratulations! That’s a really high income for a 28 year old and from your questions you definitely sound like you’re setting yourself up well for the future.

I fully understand your problem because it’s an issue that I face with my own SRS funds. It’s tricky to use SRS funds to purchase REITs because when there are preferential offerings or rights issues, you will need to transfer new funds into SRS to take up the rights. And if you purchase dividend stocks / REITs, all dividends or distributions will go into the SRS account, so it’s not like you can take the cashflow out for other purposes.

Theoretically speaking, the best use for SRS funds will be growth stocks. You plonk the entire sum into a diversified ETF tracking growth stocks, leave it there for 30 years, and get blown away by how much it has grown after that. The only problem though, is that SRS funds can only be used for SRS approved investments, and these are mainly Singapore based investments. And, at the risk of overgeneralising, there are no Singapore growth stocks attractive enough to park SRS funds for 30 years. The SGX is good for REITs, and dividends stocks like banks or real estate developers. Growth stocks is definitely not its strong suit. For growth stocks, I would typically want to go to US or China, to access the Facebooks, the Googles, the Tencents, the Alibabas etc.

One workaround, as you mentioned, is to get access to US ETFs via StashAway. Unfortunately they have a fee of 0.8% for the first S$25,000, which is frankly ridiculous, and will eat into a huge chunk of potential returns. You also don’t get full control over your allocation (eg. if I wanted to put 100% into the NASDAQ, I can’t).

So at this point, it’s really a case of what’s the least worst alternative. And I’ll share my own experience here. I plonked S$15,000 into SRS in December last year, for tax planning purposes like yourself. I used S$5,000 to buy Netlink Trust, because I like that it’s a stable counter with high yields, and I think will maintain its monopoly status for years to come. I put the remaining S$10,000 into Singapore Savings Bonds while I identify the next investment. I will probably withdraw this S$10,000 in the coming months to purchase dividend stocks / REITs on the SGX. I know that this is a problem going forward because dividends will be stuck in the SRS account, but since I plan to top up the SRS account regularly for tax planning anyway, I see it as a management problem. The dividends will just sit in the SRS account for a while, until I perform my next top up and and repurchase of investments.

I fully appreciate the limitations of this strategy (mainly the opportunity cost of the dividends sitting in the account, and the hassle of topping up for rights issues/new purchases). Unfortunately, I just wasn’t able to come up with a better strategy, and I would love to hear from any readers out there who have a better suggestion.

The main problem here is the limited choice of investments for SRS funds, with no access to quality growth stocks. If SRS funds are available to invest in either the US or HK market, the problem would disappear overnight. Unfortunately, I can also see why the government would not want to allow that, which really leaves us in this strange situation where SRS is amazing for tax planning, but the range of investments is less than ideal.



Hi Financial Horse,

I have chanced upon your blog early this year and have been really enjoying all your contents. Thank you for sharing your knowledge with us!

I am 37 this year and have only started investing last year. Randomly getting into stocks that I read about and also through recommendations by friends. (I know this is bad. :/)

My portfolio has gone down as the 2018 hasn’t been a great year.
I read about your asset allocations and would like to hear your views if I should cut loss on my positions and switch into other stocks that are more defensive in nature and to fit into the assets allocations recommendation. Or should I hold on and continue to invest in other stocks? I am wondering how to go forward from here.

So far I have :
Aims Amp – SGD15K
Asian Pay Television Trust – SGD15K
First REIT – SGD20K
Singtel – SGD30K
Starhill Global – SGD10K
Cash set aside for investment – SGD10k

All these are excluding my emergency cash.
I contribute SGD3000 every month for investment.

Look forward to your views! Thank you!


Hi there! Glad you’re finding the site helpful, and congratulations on starting your investment journey!

It’s perfectly fine to invest in stocks that you hear of from your friends, as long as you understand what you’re buying. In fact, it’s something I’m guilty of myself!

I’m going to share an often mislooked point here. And that’s the fact that the most important determinant of your investment returns, and the easiest thing to control, is actually your asset allocation. That’s the split in your asset portfolio, ie. how much you put into stocks, how much into REITs, how much into bonds, cash, property etc. The ideal asset allocation depends on your age, risk appetite etc, and you can have a look at the All Weather Portfolio for the thought process.

So before you even think about which stocks to invest in, you really should be thinking about how much you are going to allocate to shares as an asset class (eg. is it 30% of your entire net worth, 40%, etc).

Now on to your share portfolio. As a general comment, I would say that it’s definitely on the risky side. Aims Amp, Asian Pay TV Trust, First REIT, Starhill Global are definitely on my list of riskier investments, with Asian Pay TV Trust and First REIT being extra high risk investments. That’s not to say they’re bad picks, if you have a healthy risk appetite, they can actually be great investments if you have a sound investment thesis that plays out in reality.

Unfortunately it’s always a tough decision to know when to cut losses and move your money on. Without taking an in-depth analysis into each individual counter, and without knowing your financial situations and goals, it’s going to be hard for me to advise. What I would say though, is to understand the risk appetite that you have, and know how much risk you’re prepared to take for future gains.

I’m sorry I couldn’t be more helpful here. Do take a look at the article on how to evaluate REITs, it should come in handy when picking REITs in future.



Hi FH!

I am a student in Singapore and I wanna try investing for the first time in my life. However, I don’t have a lot of money (only about $100 at best) and I see that most brokerage accounts need a high minimum deposit amount. Could you give me some advice on this issue that I am facing?

Thanks a lot!


Congratulations on starting your investment journey at a young age! The amazing thing about investing is how quickly investment knowledge can compound, and the earlier you start, the more you can learn. It’s always better to learn from your mistakes when you’re investing in 3 digits, than when you’re investing in 6 digit sums.

If you’re investing only about S$100, you probably want to use one of the regular share plans, which are designed for smaller sums. There’s a helpful guide on RSPs here.

Again, the goal here is really to focus on learning about investments. If you take the time to understand what you’re buying, the financials of the company, the industry it operates in, the business strategy of the company, you’ll find that you’re setting yourself up well for a lifetime in investing, and you’ll be surprised by how this can help you in your career as well.



Hi Financial Horse, i’m an avid reader of your website. Recently while researching on some US stocks i stumbled upon this website called simply wall st.


It is a startup based in Sydney Australia which compiles all the relevant stock information like yahoo finance but presents it in colourful infographics.

I was hoping maybe you could do a review about this like how you presented Stashaway.

Looking forward to read about what your comments regarding simply wall st and whether it will be worth it to continue as a paid subscriber.



Hi! I actually came across this website as well – they really do have some pretty infographics.

Unfortunately, I just wasn’t sure what the value-add of the company was. Most of the information can be obtained from Yahoo Finance or the company website for free, albeit in a less pretty form. The scoring system was interesting, but hey, are you really going to buy a stock simply because they gave it a high score? Ultimately, you’re still going to have to take the time to really understand the company and its business, and in that aspect I wasn’t sure how helpful Simply Wall Street would be.

Personally, I wouldn’t sign up for it. But if you find that it helps you in your investments, by all means go for it!



Hi FH,

Firstly, thank you for the abundance of financial savvy writings. I’m a Malaysian based in KL and would want to invest in SG. I’m an avid reader of your blog and Financial Chickens as well.
Secondly, I’m confused with DBS Vickers cash upfront account. What does it mean? I choose DBS over FSM 1 due to DBS not being a custodian account and I can own the shares directly.

I don’t understand what it means by I have to put cash each time I want to trade. Isn’t that the only choice? It’s SGD 10 per transaction seems the best.

I considered StanChart but realized that the esavers account has to maintain a daily average balance of SGD 1K or there’ll be a charge of SGD 5.

I would like to take advantage of the fact that SG does not have Withholding Tax and capital gains tax for non resident Malaysians. Considering this, the compunded returns in SGD over the long term for a Malaysian can be lucrative.

I read your article on the brokerage charges but I’m confused. DBS cash account per trade is SGD 25 but DBS Vickers per trade is SGD 10. I’m blur.

Please advise.


Hi there! For DBS Vickers, there is a T+2 settlement, so when you purchase the stock, you will need to make payment within 2 days of the purchase, either via cash, cheque, or account debit. For DBS Vickers Cash Upfront, you will need to transfer x amount into your DBS Vickers Cash Upfront account beforehand, and you can only buy shares up to x amount. So if you have the money on hand already, there’s really no reason not to go with DBS Vickers Cash Upfront and save yourself the SGD15 per trade.

Hope this helps! Good luck with your investments! As you mentioned, one big factor for you will be the appreciation of the SGD vs MYR. If that long term trend holds, you could be looking at huge gains down the road.



Hey FH, 

I’m a 18 year old from Malaysia who realized the importance of investing..

How I found u was through your StashAway article talking abt its pros and cons.. anyways before i found your article i invested around RM 600 (200 singapore dollars give or take) and i know it might sound reckless without seeking any consultation beforehand to invest money with a roboadvisor (StashAway) but i just wanted to ask for your opinion on how a teen who seeks to grow his wealth with a small amount of startup money (btw i was invested into ANSB which is like a government protected account which only gave back small returns)hence why i withdrew from it…… i know this might be weird answering a question from someone who has zero knowledge abt the stock market and how it works etc but i just wanted to get your take on it and maybe with that also some tips if u have the time.. Love your articles and will continue to be a reader .. it would greatly appreciated if u could respond.. oh and before i go should i just put all my eggs into one basket by putting more money into StashAway or should i take it slow( i would like this to be more of a personal question) 


Hi there! Welcome to Financial Horse, and again, congratulations on starting your investment journey. I’m quite mindblown by how early you guys are starting investing these days. I didn’t really start until after university!

I think StashAway is a decent investment for your situation, with RM 600 there is no way you can get meaningful diversification to the extent you’ll be getting from a StashAway portfolio. So from an investment perspective, there’s really no reason to exit the StashAway investment.

The problem with StashAway is that because all the fund selection is automated, you wouldn’t really learn anything by investing in StashAway. And I’ve always thought that when you’re investing at a young age, the key focus is to build knowledge, rather than to build capital.

Singapore has a Regular Shares Plan that allows you to average into certain stocks on a regular basis, with small amounts and lower fees. I’m not so sure if Malaysia has something equivalent, but if you do, you could start with something like that.

Otherwise, just continue saving up your money, researching stocks, understanding businesses, and improving your knowledge. When you’ve saved up enough (eg. a few thousand RM), and you’ve found a stock you like, use the money to invest in that stock, and monitor its earnings, business outlook and price regularly. I’ve found that there’s a lot to be learnt from investing in this way, and regardless of whether your first stock makes you money or loses you money, you’ll be surprised by how much you can learn from the experience.

What I’ve also found to help, is writing. Writing about an investment allows me to crystallise all my thoughts, and forces me to articulate them in a coherent manner. It does wonders for clearing and mind and really understanding why you’re buying the stock, and is a great record when you want to look back later. If you have the time, try giving it a shot as well. Write about something investment related every week, and keep it up regularly for a year. In a year’s time, you can look back at your earlier articles, and you’ll be blown away by how much you’ve learnt.


Till next time, Financial Horse, signing out!

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  1. When I was in my 40, I considered SRS because I saved $5K per month. But after some thoughts, No. The risk is the goal post will shift….I predicted then…the retirement age. I do not like uncertain long lock up period. For SRS, there is a penalty for early withdrawal. I value freedom and flexibility above anything else. Having much locked in cpf is already enough I told myself. So SA transfer and Top ups are also no-no. I cannot predict when I need to use the money or how policies will change. I rather use the cash to invest and collect dividends in cash. I prefer to keep things simple with my 4 taps strategy which is already complex enough. 🙂 I love simplicity.
    Remember no free lunch….. You have to decide, not anyone else.

    • Thanks for sharing your thoughts! I can absolutely see why SRS would not be attractive to other investors. It’s complicated, has a pretty long lockup, and there is policy uncertainty. To me though, I really liked the tax savings, and I like that I get to invest and take it out any time subject to a small penalty. To me, the tax saving is worth it. 🙂

  2. Hi FH,

    On the issue of SRS investments. I, too, am struggling with the exact same issue that you have described (I believe I had made similar comments on your article on Stashaway) – that of there being no real optimal investment instruments for SRS. I’d like to share my thoughts and my own conclusions.

    I am cautious of using SRS to invest in growth stocks, because there exists the potential issue of implicit “capital gains tax” on withdrawal at 62 (I will later refer to this as caveat #1). Of course this ‘issue’ would not apply to everyone, because it assumes a certain high rate of accumulation of SRS to bust tax-free withdrawal limits at 62 – but it matters to me, and it showed me that SRS is not optimised for growth. Ideally, for a person pursuing a diversified portfolio, his weight of investments in growth stocks should not be in SRS.

    So then the question became, what is SRS optimised for? Since I am heavily cash-invested in US growth stocks, SG dividend stocks/REITs (which I believe, are much in line with your investment philosophies as well), I concluded that my SRS is best deployed for semi-defensive instruments (together with CPF SA, which I consider to be most defensive). This to me = bonds.

    So to me, it came down to ABF Bonds ETF vs SGS bonds vs Stashaway. Long story short, I decided to go with Stashaway, the reasons being:

    (1) Stashaway, compared to the other 2, still has a higher rate of return (even after factoring in the management fee) because of its investments in far more vibrant and efficient markets. I did this via some bit of trial over a period of 4-5 months between ABF bond ETF and Stash.

    (2) I find the economic regime rebalancing function of Stashaway useful not only because it serves as some form of defensive mechanism (while this assumes that the algorithm is generally correct, I believe these kind of tools often err on the side of conservativeness, which is fine as a defensive mechanism), but more so that it actually allows me to “see” when the algorithm is “moving”, via the reallocation of my assets. This is a useful input for my whole investment portfolio and strategy. These are volatile times, and I believe that you too (if indeed we are similarly invested) have this nagging concern about when the next crash is coming (because by time it is about due), and about how global economic data is really not supporting the kind of growth in the equities market we are observing. So having a computer that is able to trawl huge amounts of data etc., and provides indicators that the economic regime may be shifting is a useful input. Of course, it could be a case of rubbish in rubbish out – but I’m always for more information.

    With these two reasons, I’ve decided to invest my SRS in Stashaway, with a moderately-defensive risk factor. Of course, I’m trying to mitigate the exorbitant fees by maximising the referral program giving me 6 months free management for $10K.

    At the end of the day, you are right – SRS investment instruments are really non-optimal at this point in time, and our headaches will be solved if lets say they allow SRS to be invested in far more globally diversified ETFs. But till that day, we make do with what we have – and these are my conclusions (subject to caveat #1).

    Would be happy to hear your thoughts and suggestions about my line of reasoning, blindspots I may have missed.

    • Hi Alaric,

      As it turns out, you are right that our portfolios are highly similar! Interesting thoughts on SRS though, I never thought of using SRS for defensive style investments.

      My main problem with using StashAway is (1) the high fees (the referral program won’t last forever, and 0.8% is just nuts) and (2) difficulty in rebalancing StashAway with the rest of your portfolio. Eg. If you’re using StashAway for S$10,000 in SRS, you’ll need to broadly take into account what StashAway has invested in, and factor that into decision making for the rest of your portfolio.

      I was highly bearish on the economy heading into the start of this year, but the recent U-turn from the Federal Reserve has resulted in me changing my position. My latest thinking is that we may be in for a few years of slow economic growth with small rate hikes (similar to a Japan style situation). In such an environment, REITs and growth stocks like the FAANG would outperform, which would explain the recent movement in market prices.

      Given t his macro outlook, I’m actually inclined to withdraw my SRS funds from the current SSBs and deploy them into Singapore stocks. The implicit capital gains on SRS bothers me a lot less because if the SRS funds have grown so significantly that withdrawal at retirement becomes an issue, it really is a happy problem and indicates a life well lived. At that point in my life, paying a 5% tax to withdraw some funds really isn’t going to bother me a lot. 😉

  3. Hi there how about the S & P 500 ETF listed on the SGX?

    Also interested to hear your updated thoughts on Investing in this current macro environment. Recall a few month back you were concerned about valuations especially for REITs. Do you still feel the same way?

    If one has cash, wait and see? Or deploy?
    Personally, Have adopted a wait and see and missed out on some of the post December rally.

    • Hi there,

      The S&P500 listed on the SGX has incredibly poor liquidity. I would just go with the one listed in the US or on the LSE.

      I think the decision of whether to invest always depends on your personal situation. If you have spare cash and dont need it for say 10 years, you’re probably better off having it in equities than in bonds. After all, nobody knows for certain when the market will crash, we can only guess based on the current stage of the economic cycle we are at.

      I’m continuing to stay invested in this market, I don’t think its as bad as what people say. I think the chances of a crash have been reduced after the Fed took rate hikes off the table, but I also think the next few years may see slower global economic growth.

      The REITs have had a massive runup the past few months, so I think they’re a bit on the pricey side, but again it really depends on your investment objectives. If you’re a long term investor, the yield on a blue chip REIT (about 4.8%) is still a lot higher than that of an SSB (2.16%). There are plenty of opportunities in this market still.


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