Investment Archives | Page 15 of 20

Buzzworthy $langs That Every Singaporean Investor Must Know

BID WHACKER

Although it sounds like a superhero’s name, a bid whacker is someone you do not want to invite to the market! Bid whacker refers to the investor who sells below or at the bid price. This act temporarily drives down the market prices of a security. As sellers normally negotiate for a price between the bid and ask quotes, the unconventional bid whackers usually upset other sellers.

TRIPLE WITCHING

Triple witching or Freaky Friday occurs on the third Friday of December, March, June, and September. At this time, the stock market index options and futures expire in one day. This leads to great volumes of trading as investors try to offset their options and futures before the time is up.

BLUE CHIP COMPANIES

You often hear financial gurus advising you to invest on the blue chips, but what do they really pertain to?

Blue chip companies are large companies that are considered to be well-renowned, highly established, and more financially sound. If you want to invest your money in stocks that have proven their strength and profitability through economic downturns then you should consider these companies. International blue chip companies include H.J. Heinz (HNZ) and Disney (DIS) while local blue chip companies include Singapore Press Holdings (SGX: T39) and Singapore Telecommunications (SGX: Z74).

ANKLE BITER

An ankle biter refers to a stock that has low market capitalization. These are also known as small-cap stocks and encompasses many emerging technologies. Ankle biters as an investment tend to be more fickle and typically thinly traded. However, the growth potential in these stocks are higher than the large-cap stocks.

Image Credits: pixabay.com (CC0 Public Domain)

STALKING-HORSE BID

Stalking-horse bid is an initial bid on a bankrupt company’s assets. It usually comes from a serious buyer selected by the bankrupt company itself in order to prevent low-ball offers and enforce an engaging bidding war. Once the stalking-horse bid is received, the bankrupt company will open its doors to other interested companies that are willing to offer their own bids.

With this strategy, the bankrupt company is able to attain the best possible price.

Sources: 1 & 2

5 Things To Consider Before Investing On Gold

1. WHAT TYPE OF GOLD INVESTMENT?

There are two types of gold investment: physical gold and paper gold. The physical gold consists of the tangible gold bars, jewelry and coins. While the paper gold consists of the gold exchange traded funds or gold-related equities in the stock market.

The latter is more at risk with fraud, as you have no guarantee that the fund holds the amount of gold they claim. Furthermore, the stock market can be vulnerable due to the government intervention and hacking.

2. WHY SHOULD YOUR PORTFOLIO INCLUDE GOLD?

Including gold to your overall portfolio is a good way to diversity your assets. As the price of gold generally moves in a different direction than other types of investments, it can balance out your returns when the others are performing badly.

Cary Guffey, a Certified Financial Planner Professional and Board Ambassador, forewarns that you must not put too much of your wealth in gold. According to him, a good rule of thumb is having no more than 5% of a certain commodity in your portfolio.

3. HOW PURE SHOULD YOUR GOLD BE?

Pure gold (100%) is too soft to manipulated as bars and jewelry, therefore it is mixed with other types of metals such as silver, nickel or copper to improve its strength. Based on the content of gold, it is divided into “karat” configurations namely: 9k (37.50%), 14k (58.33%), 18k (75,00%), 22k (91.66%), 24k (99.99%). Ensure that you are getting what you paid for.

4. WHERE SHALL YOU BUY THE PHYSICAL GOLD?

In Singapore, physical gold can be purchased online or at the bank. For online bullion shopping, consider the trusted bullionstar.com where 1 gram of PAMP Gold Bar costs about S$79.54. Alternatively, you can purchase gold bars and gold bullion coins at UOB.

5. WHAT IS THE REAL PRICE OF GOLD?

Just like anything else, the price of gold is influenced by the supply and demand dynamics. In fact, 5 years ago gold’s price was about S$1,800 per ounce compared to today’s S$1,664 per ounce. Alongside this dynamics are other factors that affect the gold’s price…

Image Credits: bankrate.com

Sources: 1, 2, 3, 4, & 5

Practical Ways To Ease Your Stress On Financial Responsibilities

DO NOT BE FOOLED BY THE 0% INSTALLMENT PLANS

There are an array of goods that you can buy through 0% installment plans such as furniture, designer bags, electronic devices and appliances. Without control, you can potentially pile up your installment plans to the point that you can no longer afford paying for credit card bill.

Say you are strolling around the mall in the lazy weekend when you suddenly saw a shiny sign that says:

“FULL HD FLATSCREEN TV FOR SALE

S$1,400 (U.P. S$1,600)

0% INSTALLMENT THRU UOB & OCBC CREDIT CARDS.”

It sounds tempting, right? But do you really need that telly when you have a functional one at home? Do you need another burden to add on your credit card bill? Well, it is time to live within your means!

UTILIZE YOUR CPF ACCOUNT WISELY

The Central Provident Fund (CPF) is a compulsory savings scheme for Singaporeans that is automatically deducted from the wages. Your CPF account can be used to support crucial financial commitments such as retirement, healthcare, and property purchases. While it is sitting there passively, you can maximize its use by utilizing it wisely. For instance, if you are using your account to purchase a new flat or refinance your current one, examine the situation every few years to see which is the better economical option.

And if you are not touching your CPF savings for a long period of time, consider putting it to the CPF Investment Scheme. It is a way to invest your CPF savings to various banks such as OCBC, DBS, or UOB. The money you will generate from your investments will eventually go to your CPF account and not your pockets. Compare the investment options and their charges. Instead of complaining about your “useless” account, why don’t you start investing?

FOR MARRIED COUPLES, SUPPORT EACH OTHER

Alongside merging two souls, marriage merges two finances together. Having another person to run to for support, opinion, and advice can help you make better financial decisions. For instance, if you are searching for a space at an Executive Condominium (EC), consult your spouse first. Are your incomes enough to suffice the payment of the EC? You do not want to end up working took hard for an EC when what your spouse just wanted an HDB all along.

Setting long-term and short-term financial goals such as purchasing a house or establishing realistic budget should be done together. Along with the goals, you must assign financial responsibilities to each other. Encourage and support each other throughout the process.

ALWAYS COMPARE PRICES

Almost every shopping hack includes a section about comparing prices so that your money would not go to waste. True enough; reading reviews and shopping around helps you get the best deal. Since comparing prices in physical stores is a troublesome and time-consuming activity, people have turned to technology. For example, browse at PricePanda if you are camera shopping. PricePanda.com.sg, the leading price comparison website for emerging markets worldwide, provides its users with prices, technical details and other information about the latest gadgets.

And if you are looking for an affordable wedding banquet, turn to SingaporeBrides.com.

Image Credits: pixabay.com (CC0 Public Domain)

SingaporeBrides.com is your one-stop portal for your local wedding festivity needs. Here you will see that the cheapest banquet venue for lunch and dinner costs S$501 at LingZhi Vegetarian.

Sources: 1 & 2

You Wouldn’t Believe How Much Gold’s Price Has Fallen

Dan Gable once said: “Gold medals aren’t really made of gold. They’re made of sweat, determination, and a hard-to-find alloy called guts.”

In his own definition, gold’s essence translated to the person’s special characteristics. However, majority of the world perceives gold as a value commodity.

“What makes gold so valuable?”, you may ask. For starters, it lasts for a long period of time, it can be easily manipulated, and its appearance is very appealing.

But aside from this, gold is a rare element because no mine has an unlimited supply of it. Once all the gold is sold and spent, the mining company’s stock will fall. Any efforts to get more gold will affect the company’s wealth.

Gold’s rarity makes it more valuable than other common elements such as aluminum or iron. Its prices are not set by a single organization, rather they are influenced by the cost of production and the amount people are willing to pay for it. For instance, when the demand of gold is relatively high at a given base price and the competition is higher than expected, it is just right to increase the base price in order to regulate the demand of gold. And if not so many people are interested in purchasing gold, its price will stay closer to its actual production cost. Whether you like it or not, we are currently observing the latter statement about gold.

Gold’s price has dropped by about 1.4% last Thursday (14th April) – that is US$1,228.70 (S$1676.32) per ounce. This is in conjunction with the rising Asian shares and the strengthening of US dollar. Moreover, regional currencies weakened against the greenback after the country’s central bank set the rate of appreciation of the Singapore dollar policy band at 0%.

According to Gold Rate 24, a website that partakes information about the gold’s prices around the world, an ounce of 24K gold is priced at S$1,672.04 (US$1,226.99) while a gram of 24K gold is priced at S$53.76 (US$39.45) as of today. A substantial drop has been seen within 30 days from S$1,702.81/oz to S$1,672.04/oz.

HSBC analyst James Steel was quoted saying:

“Gold is weakening on a recovery in investor risk appetite. The sharp (equities) rally and the leveling off of gold-ETF demand recently argue for some period of price consolidation.”

Steel’s claim of the lowering investor risk appetite towards gold is supported by the figures of the world’s largest gold-backed exchange-traded fund – SPDR Gold Trust. Assets of SPDR Gold Trust fell 5.05 tones to 806.82 tones last Thursday, its lowest in a month.

The demand drop of gold affects the prices of other valuable elements such as silver, platinum, and palladium.

Sources: 1, 2, 3, 4 & 5

4 Don’ts Of Real Estate Investing

Since land is scarce in our country, properties had always been a go-to investment option for many. The majority of these investors have strategies limited to purchasing, reselling, and renting flats or condominiums. While others consider other options such as the Real Estate Investment Trust (REIT).

REITs allow the investor to have a professionally managed portfolio of properties by purchasing a publicly traded investment product. Investors of REITs purchase units of the trust similar to shares of a common stock.

But no matter what type of property you purchase, here are 4 Don’ts Of Real Estate Investing to help you on your journey…

1. DO NOT FORGET TO IDENTIFY YOUR GOALS

Before committing to a property or even a property visit, it is important to understand what you want to achieve from investing on real estate. Be on a peaceful place where you can think carefully about your goals for the long-run.

You must have a transparent idea of your existing income, current expenses, and outstanding loans before diving into another complex route. Also, you must identify your budget and type of risk you are comfortable with.

2. DO NOT GO WITHOUT RESEARCHING

After identifying your financial circumstance and your investment goals, you must do your research on real estate investments in order to be sure that it is worth your money. For example, a two-bedroom HDB flat can cost about S$250,000. That is a huge sum of money you may be willing to risk if you are serious in property investing. The risks only increase when the investor does not understand how the property market works or when and where to invest. Hurrying up without analyzing the situation thoroughly can only bring about more damage (e.g., bankruptcy) than good.

So if you lack sufficient knowledge, seek advice from a financial consultant or other professional advisers. And when you find the “right property”, ensure that you keep your expectations realistic and keep your finances in tact.

3. DO NOT EXPECT TO BE A MILLIONAIRE QUICKLY

Do not fall into the trap that some real estate investors set – offering you properties for small amounts of cash with higher returns. These “undervalued assets or profitable investment opportunities” are mostly likely unsold overseas property projects. You see, real estate investors usually do not offer “jackpot” properties to complete strangers. They only invest with the people they know well.

There are no shortcuts to success on real estate investments! In fact, you must allot a long period of time on finding a property in a decent location, building a good relationship with the tenants, and maintaining the condition of the property. Time that may not be in the good side of most.

Image Credits: pixabay.com (CC0 Public Domain)

4. DO NOT PURCHASE A PROPERTY WITHOUT VISITING IT

In support of your in-depth research, you must drive to the property itself before signing any contracts. There are a number of reputable realtors and agents who can give you feedback about certain properties but you must follow your own instinct in the end.
There are no shortcuts to success on real estate investments! In fact, you must allot a long period of time on finding a property in a decent location, building a good relationship with the tenants, and maintaining the condition of the property. Time that may not be in the good side of most.

Sources: 1, 2, 3, & 4

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