BigFatPurse tracks two model portfolios and a real money portfolio. We will take this opportunity to review the performance in 2015.
STI ETF
Being a Straits Times Index (STI) Exchange Traded Fund (ETF) advocate, we have created a model portfolio to simulate a dollar cost averaging investment plan and tracked its returns.
The model assumed a regular investment of S$500 per month, buying into STI ETF at the prevailing prices. Dividends were reinvested to buy more ETF in the following month, in addition to the S$500. It started on 2008.
Over the course of 8 years, a total of S$47,500 have been invested. The profits made were S$5,178, and this means the compounded annual rate was 2.6%.
This isn’t a fantastic number considering the CPF Ordinary Account was offering 2.5% per year. A lot more was expected from the stock market.
The unusually low returns from STI ETF was due to two ......