Dear readers, I am not sure about you. But for myself, a Singaporean investor; I started investing in Singapore stocks and thereafter diversified into US stocks. I am doing this for one main reason and that is to capture opportunities in equities on the world stage that are presented to Singaporean investors at the click of a mouse and with the ease of an internet.
My mantra for SG Stocks Investing strategy is really a simple one: invest the core of one’s investment portfolio into the STI ETF for a defensive, relatively-safe and resilient position. Thereafter, use the remaining portion of one’s investing portfolio into potential multi-baggers on the global stage to further multi-bag one’s capital gain.
The rationale is simple. There is just so much market size for the listed companies on the Singapore stocks markets. And to expand, our Singapore companies would have to venture overseas to capture a larger size of the global market but that is where all the markets and business risks unknown to these companies before appears and not all the Singapore companies will be able to navigate these risks well. If these business risks are not managed well, then the stock prices of these companies will go south.
On the converse, investing in companies which already has an existing market with still lots of potential left untapped makes for a sound investing proposition. And companies will good fundamentals in the aforementioned aspect makes for ever valuable candidates. That is why I always say: “Stable STI Core, multi-bagged by potential international picks!”
Note: this article was first published on SG Stocks Investing on 20 Nov 2019.
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