More than a year ago, I was studying the stock market and flipping through numerous books, articles and papers.
When trying to piece everything together, it was clear to me that my investment objective wasn’t to create outsized returns but to:
1. Achieve market beating returns – returns exceed STI ETF
2. Minimum effort of mantainance – passive investing style
3. Lower or equal risk than the STI ETF during bad times
I figured out that the average investors fail to meet or exceed the STI returns on a consistent basis despite the latter follows a simple set of criteria like:
• Hold top 30 largest SGX stocks by market capitalization
• Quarterly re-balancing.
Other than liquidity consideration, there was no human intervention throughout the process. It was very counter intuitive insights that systematic performs better than human discretionary, my guess was that humans are generally poor performers of activities that …