The folly of the retail investment community in Singapore

I haven't been writing about investments because I genuinely believe the public needs to be taught a lesson for listening to sub standard advice.

They believe that 0.5% processing fees, 1% sales charges are acceptable as long as the sales person is hot. The general public does not know simple mathematics and bloggers and advisers similar do not know simple mathematics. The first step is to learn geometric progression — go back to primary school, please.

Rule 1: Fees should be kept minimal. Free is better than 0.1%. 0.1% is better than 0.5% and in turn, 0.5% is better than 1%. In this light, buying from exchanges make more sense than from anyone else. Period.

Rule 2: Run away from ongoing charges. Sales platforms like charge you a fee on AUM (asset under management) is simply disgusting. They will all be disrupted by Fintech soon. The only persons that deserve a fee is the manager.

Rule 3: Diversify. Diversification is scientific. Read this set of slides. Buy into an index fund. A non-traded index fund is better than an ETF. A physical ETF is better than a synthetic ETF.

Rule 4: Re-balance annually. Not anymore or less. Stop reading substandard blogs and start taking the CFA curriculum if you are genuinely interested in finance. You won't get a job in the financial industry because you passed all 3 levels, but at least you won't get cheated.

The MAS money sense website has one of the best and most updated information on investments. Please read it.

My personal advice:

A. Spend money on Uber. Save time. Don't spend money on expensive investment intermediaries

B. Spend money outsourcing work. Don't do administrative work yourself and waste all the time and effort learning nothing. Rest more often. Think deeper. Read, take the CFA curriculum.

C. Enjoy life. Eat better. Do not take anything to sales platforms. At best, pay a small commission to the exchange and an electronic broker.