MoneyLab

  Investing and gambling are sometimes discussed in the same context as they both involves putting money at risk with the goal of making a profit. To distinguish between the two, we first need to understand what is gambling. There are two main elements of gambling: 1. Gambling involves randomness and it is therefore risky 2. The expected return of gambling is negative (note, I'm excluding games like poker where the skill of the player can increase their chances of winner against other players). For example, the roulette at casinos has an expected return of -5.3%, which means for every $10 you bet, you are expected to get back only $9.47. The slot machine expected return is between -15% and -2% depending how the machine is configured. And Toto, our national favourite form of gambling, has an expected return of an abysmal -58%!! Like gambling, investing also carry risks. Changing market conditions, shifting demand and supply, new innovation etc. could influence the value of your inve...

CPF: $376,000 MA was topped up to BHS at the start of the year, while SA has exceeded FRS due to OA->SA transfer and RSTU over the past few years. Cash: $260,700 Consists of a combination of cash and cash equivalent in high-interest account, robo cash management and SRS. The amount in SRS is awaiting allocation into Dimensional US Core Equity. ETFs: $98,800 My market timing portfolio which consists mostly of CSPX and some QQQM Endowus: $89,600 My DCA portfolio for international exposure and tilt toward small cap, value, profitability and momentum. The portfolio consists largely of Dimensional funds, including US Core Equity (30% of monthly DCA), Global Core Equity (30%) , Global Targeted Value (20%) , Emerging Market Large Cap (10%) and Pacific Basin (10%) . SG Stocks: $61,400 Individual stocks with focus on dividend-paying companies. Most were purchased during my early foray into investing. Stashaway: $10,700 SRI 20% which I brought while experimenting with robo advisors. I no long...

  When it comes to investing, many people who are less financial savvy turn to financial advisors (FAs) for guidance and advice. Ideally, FAs are expected to act in the best interests of their clients and provide them with recommendations that will best help them achieve their financial goals. However, in reality, there are self-serving FAs who prioritise their own interests over their clients', and this is unfortunately more common than we would like. For instance, FAs often promote investment-linked insurance plans (ILPs) because these products offer high commissions that the advisors can earn from selling them. They often touts the benefits of these professionally managed ILP funds which are managed by fund managers with years of expertise and experience in analysing markets and making investment decisions, and the flexibility to adjust their portfolios based on market conditions and outlook to help you earn higher returns. It sounds good, but none of these claims are backed by ...

  Credit card rewards are a popular perks for consumers, offering generous signup bonuses, cash back, miles and other incentives for using a particular card. But have you ever wonder who is actually paying for these rewards? Before we answer that question, we need to know how credit card companies make money. There are typically 3 main sources of revenue, including: Interchange fees - fees that credit card companies charge merchants for accept credit card payments. These fees typical range from 1% to 3% of the transaction amount. Interest charges - fees that that credit card companies charge cardholder who carry a balance on their credit cards. These charges are typically in the range of 25% to 30%. Cash advance fees - fees on loans taken out against the credit limit of a credit card, which is typically 8% of the loan amount. There are also other sources of revenue such as annual fees and penalty fees, but they contribute less to the credit card companies income. A portion of th...

ETF investors may have wondered whether they should add international stocks to their portfolio or stick with the S&P500. Proponents of international stocks highlight their lower valuations and potential diversification benefits as reasons to invest in them. However, well-known investors like Warren Buffet and Jack Bogle believes that non-US stocks are unnecessary. I do tell people, feel free to disagree with me because I'm not always right, but I have 0% in non-U.S. I say you don't need to have non-U.S., but if you do, limit it to 20%.   -- Jack Bogle, 2018 interview with Morningstar   Reasons to stick to US stocks   One of the reason why investors favour US over non-US is that the US stock market is considered one of the most efficient in the world, supported by sound financial institutions and governance as well as strong investor protection laws. The US economy is also highly diversified and includes a broad range of industries, making it more resilient against a...

Investing in exchange-traded funds (ETFs) is an effective way for investors to diversify their portfolio and gain exposure to a broad range of investments. However, some folks may find it difficult to stick to this "boring" way of investing, particularly when they hear the extraordinary returns from other investments, be it Dogecoin, Arkk funds or technology stocks. This is understandable since many people like to compare themselves to others and may feel like they are missing out on phenomenal returns achieved by their peers in a short period of time. As an ETF investor, you need to accept that you will never be the number one investor on an year-on-year basis, not even close. But the good news is, over a period of several decades, you will almost always be better than majority of the investors who adopt a more active investment approach. Feel like you are missing out ETFs are designed to provide returns that are consistent with the market average. This means that they will ...