Author: Fatty Finance

Asset Allocation: Asset Classes

In this article, I would like to quickly introduce the various asset classes and how they might fit into your portfolio. This is not meant to be an exhaustive list but just to give some ideas when building your portfolio. Towards the end of each section, I would provide some example ETFs of each class. This is a continuation from my previous article “Portfolio Building Basics: Asset Allocation“. So if you are unfamiliar with asset allocation, I would recommend giving it a read. To quickly recap, there are 4 main asset classes BondsStocksReal Estate Investment Trusts (REITs)CommoditiesBonds Bonds are...

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COVID-19 Situation and Impact On the Markets

Singapore now ranks the second for most cases of COVID-19 outside of China that is if you exclude the cruise ship. The impact of COVID-19 already exceeded the economic impact of SARS and the prospects of recession is quite possible. A lot has happened since the first post I had written on the COVID-19 outbreak. As more deaths are reported each day, one wonders to what extend has the impact of the virus be on the global economy. Outbreak Summary Source: Dashboard from Johns Hopkins University Center for Systems Science Engineering Total confirmed cases worldwide is 67,188 with a...

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Brexit Impact On Irish Domiciled ETFs

Dividends and tax avoidance. Singapore investors love them. Just recently I came across an article talking about the most tax efficient ETFs for Singapore investors. If you are a non-US tax resident and have invested in US stocks, you may be aware that there is a 30% tax on all dividends received. This is dreaded dividend withholding tax known to all dividend investors. The purpose of this article is not to talk about dividend withholding tax. So either check out the article by investment moats or the one by financial horse. But if you need my explanation, here it...

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Portfolio Building Basics: Asset Allocation

As I mentioned in my previous post, for the average DIY investor, a passive investing strategy is the most optimal – it produces the most reliable result with the least effort from the investor. Is implementing passive investing completely effortless? Well, you will need to do a bit of homework before starting. That homework is determining your asset allocation. Typically, the four main asset classes are: BondsStocksReal Estate Investment Trusts (REITS)Commodities In this article, I will only talk about stocks and bonds which are the two main asset class for your portfolio. In my next article we will explore...

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Start Hoarding When Others Are Panicking

It happened in Wuhan. Just recently, it happened in Singapore. When the Singapore government raised the Disease Outbreak System Condition (Dorscon) alert level to orange, its citizens responded by stock piling all essentials. Pictures of empty shelves in supermarkets and shoppers lining up in long queues filled social media. It also drew the ire of many online. People were ridiculing, shaming and making fun of these people who hoarded as if to prepare for a zombie apocalypse. After all, these hoarders are out of their minds, aren’t they? I would argue it is rational behavior. Really? Let me explain...

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The Endowment Effect And Decision Making

In my previous post, I argued in length against stock picking and market timing. Passive investing is the most optimal strategy for most of us retail investors. I have a confession to make: I am still holding an individual stock in my portfolio – AAPL AAPL price was currently trading at $325.21 at closing. Is it overpriced? Yes, in my opinion. There can be many reasons why the stock price is surging – share buybacks, increase revenue streams from subscription and services etc etc.. but evaluating the share price is not the point of this article. Will I sell...

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When Aiming for Average is Better: Passive Investing

The self-help genre has been consistently preaching about improving ourselves, making a difference and being the best you can be. A couple of common themes are: You have to put in hard work to gain moreBe proactive, do not be passive. The world does not owe you anythingYou get what you paid for. Pay for valueBe a master of your craft. Go deeper, understand the complexities, develop sophisticated work.Take control, do not surrender to fate. You are the captain of your destinyKnow what you want, drop everything and focus on pursuing your dreams. Eliminate all distractions Congratulations if you...

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Mutual Funds and Exchange-Traded Funds

Everyone loves a buffet. At least I do. Modern day investing is like a buffet – we have so many different kinds of investment products to choose from. Let us look at the most common and popular investment products: Mutual Funds (or Unit Trusts) vs Exchange-Traded Funds (ETF) Funds: The Buffets of Securities If all your securities (stocks, bonds, commodities) are food, then funds are the all-you-can-eat buffets. The main advantage of buffet over a regular a-la-cart meal at a restaurant is that you get to sample a variety of different dishes. Funds allow the investor to hold a...

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