Don't Overlook Investing in Singapore (and not just in the U.S.)
Oct 02, 2024 12:52 pm
Hi ,
Have you ever considered that some of the best investment opportunities might be right here in Singapore?
Investing in global companies, especially in the U.S., is a great long-term strategy. However, U.S. stocks often get overpriced due to market speculation, especially with the current hype surrounding Artificial Intelligence.
As investors, it's crucial to focus on strong, undervalued companies that tend to be overlooked by the markets.
The Singapore market is known as a good place for generating passive income, thanks to our fundamentally strong companies that are often undervalued. This is mostly because of their limited global reach beyond Asia.
The key characteristic of Singaporean companies is their stability, competitive edge, and steady growth. Companies like DBS, CapitaLand, Jardine Matheson, Keppel, and others are prime examples.
Consider CapitaLand, for example—a leading property developer and asset manager with a strong presence not only in Singapore but also in China, Australia, and over 260 cities worldwide. Likewise, Keppel operates across more than 20 countries, delivering essential infrastructure and services in sectors like renewable energy and clean technology.
As these companies expand across Asia, their stock prices increase, giving investors solid capital gains. Historical data on rate cut cycles shows that the Singapore stock market performed well during previous U.S. interest rate cuts, like those in 2007 and 2019.
With the ongoing U.S. rate cuts, Singapore stocks are expected to benefit. Year-to-date, the Nikko AM Singapore Straits Times Index ETF has already returned 16% (Red Line), and a comparable professionally managed fund focusing on Singapore stocks has delivered 29% returns (Blue line).
So, we don’t need to chase shiny U.S. stocks for good returns—we can start right here at home!
I hope this gives you some food for thought as you consider your investment strategies.
Best Regards,
Zest Chia
Executive Wealth Consultant | Associate Estate Planning Practitioner |
Licensed General Insurance Advisory
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