Dear readers, Singapore stocks have been doing so well that I believe you may have read of the comments on the current strong showing of the Straits Times Index. At 3,624.76, the Singapore Straits Times Index is the Best showing so far since 2007, some 17 years ago. What is your investment strategy right now? Well, I am going to share with you my investment strategy.
In an earlier post, I warned that stocks markets which reached multi-year highs may correct soon. We noted that for the Singapore stocks markets which reached multi-year highs in 2007, only to correct in 2009. This is what I have noted from a historical perspective. Whether or not, the current global stock rally, fueled by the US interest rates cut will persist is any one’s guess. I will further add that beside a historical perspective, I must say it is a perspective of nature: what goes up must come down.
In fact, ever since the global stock markets corrections in 2009, stock markets have generally been trending up, except for a brief period during 2020 when stock market corrected. But I am of the view that the 2020 stock markets corrections was not in the league of major stock market correction, though it was indeed a correction. The longer the stock markets have not corrected, the more many commentators said of an even more significant stock markets correction to come.
Let us for now, turn to the current Straits Times Index (STI) component stocks which are Overbought currently. The current Overbought Straits Times Index brought with it, Overbought STI component stocks like the following:
Overbought Strait Times Index stocks
DBS stock
OCBC stock
Keppel stock
Sembcorp Industries stock
Seatrium stock
Singpost stock
Singtel stock
STI
UOB stock
Do take note of the above if you are intending to invest right now in these stocks: they are currently Overbought and hence entry point may not be the most optimal. But whether or not, these STI component stocks will continue to fuel is anyone’s guess.
When interest rates are high, it makes sense to buy and own Singapore Savings Bonds, Singapore Treasury Bills and Fixed Deposits, these are generally risk-free. When interest rates are going low, the advice is to hop onto equities, but I must caution All that unlike bonds, fixed deposits and T-bills, equities carry investment risks.
I still prefer to hold sit on the sideline for now and hold some Cash for now including those still deployed in the risk-free assets like fixed deposits, T-bills and bonds. Never mind analysts’ comment that we should all flock to equities now. I like to hold an independent view when it comes to investing my own monies.