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Buy sti etf every 14 days to dollar average

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STI means Straits Times Index (STI). This is the stock index in Singapore. The STI dates back to 1966 and has been used to track the performance of the top 30 companies that are listed on the Singapore Exchange.

These 30 firms are drawn from 19 different industries and 5 different sectors representing Singapore’s diverse economy. The index is constructed jointly by the SGX, FTSE, and Singapore Press Holdings (SPH).

Why Invest in STI ETF?

If you are not sure yet where you need to invest, here are some reasons why you should choose STI ETF.

Low-Risk Investment at Low Cost

Investing your money in an STI ETF allows you to invest in several blue-chip stocks without requiring a lot of capital. Because of the investment strategy, you don’t have to spend much cash purchasing stocks from individual companies in the index. Buying them individually will ultimately be expensive.

This form of investment also enables you to track the share index and gain exposure. It’s a long-term investment, which makes it low risk. In addition, Singapore’s economy is also growing; therefore, if you track a national stock index, you are investing in the country’s economy.

It’s also ideal for beginners who have no idea where to start. You can spread the risk on many companies and avoid incurring huge losses if a company winds up or performs poorly or there’s a stock market crash. If it’s your initial investment, you may also not know how to pick the right stock. STI ETFs offer broad exposure to multiple companies instead of putting all your money in one single stock.

Lower Fees

Compared to actively managed funds, STI ETFs have fewer fees. Unlike the former, the primary focus is not to generate profit. An STI ETF just replicates the performance of an STI; therefore, the management fees are lower. Also, you won’t incur any charges when you trade your units.

However, like any other investment portfolio, there are basic charges such as brokerage fees and commissions. To get the lowest costs, you can compare online brokerage accounts to choose the most suitable.

They are Easy to Trade

Since STI ETFs are listed on the stock exchange, they can also be traded. The public can sell and buy shares on a market trading day. These assets are a long-term strategy, but you can opt to see if it makes sense, especially during market fluctuations.

As an investor, you should closely monitor your ETF. When the price is low, you can take advantage and buy more STI ETF shares. On the contrary, this can be an excellent opportunity to sell your units and earn a quick profit when they start rising.

What Are The Benefits And Risks Of Investing In STI ETF?

If you invest in an STI ETF, what are the benefits and risks?

Benefits

They are low risk

Easy to buy and sell

They have lower charges

It’s a long-term investment

You can use a small investment capital

You can invest in the future of Singapore

Risks

Volatility risk during a stock market crash

They have a tracking error

Poor liquidity

Fund management risk

Country concentration risk

Companies in this stock index include UOB, DBS, CapitaLand Limited, Singtel, and Keppel Corporation, which are among the largest businesses incorporated in Singapore. The companies in this list are updated quarterly, and some may be removed, and others added. The review is based on the stock and weight of each company.

A stock index like the STI represents a section of the stock market. Like Singapore, each country has one or two major stock indices used as a barometer for their market. The U.S. has S&P 500 and the Dow Jones Industrial Average, Japan has Nikkei 225, while Hong Kong has Hang Seng Index.

Exchange-traded fund (ETF)

An ETF or exchange-traded fund is similar to an asset class, just like unit trusts and stocks. Just like stocks, they are also traded and listed on the stock exchange.

Once you buy shares of an ETF, you own a portion of the total fund. Through this investment, you can buy and sell the shares to profit and earn money via dividends.

Investing in exchange-traded funds enables you to track a stock index such as STI in Singapore. With it, you can replicate the performance of a particular index, assets, bonds, or commodities such as gold.

STI ETF

Now that we know what an STI and ETF are, we can define an STI ETF. This is an investment fund that’s used to replicate and track the performance of the STI. As an investor, you can do this by spreading out your investment in as many companies in the STI to ensure that your investment gets the best returns. Therefore, if the STI ranks a company like OCBC higher and increases its weight, your fund manager will increase your investment in the same firm.

$Straits Times Index(STI.SI)$ $ES3.SI(ES3.SI)$