Converting your hard-earned earnings into assets that increase in value is frequently necessary to build your future. We provide some tried-and-true options for investments in Singapore solutions to help you strive toward a more stable financial future.
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Corporate Bonds (CB) and Singapore Saving Bonds (SSB)
Bonds are a traditional option if you value conserving money and a consistent income stream. In essence, a bond allows you to “lend” money to the government (SSB) or a business (CB) for a predetermined amount of time at an interest rate that is ensured. Your capital is usually refunded after the contract time, and interest is paid out regularly. Bonds often provide larger returns than bank deposits, and if you sell them for more than you originally paid for them, you may be able to profit from capital gains.
Structured Deposits (SD)
DBS offers structured deposits that are less risky and offer better returns than stocks and bonds. SD is a combination of an investment product and a bank deposit; rewards are contingent on the success of the underlying financial products, which may include foreign currency, bonds, shares (investment in traded businesses), market indexes (such as SGX), or a mix of these. Along with your regular interest income, you receive your entire principal back when the loan matures.
Unit Trusts
Unit trusts or collective investment plans are excellent choices if you want to allocate your money across many other securities, including stocks, bonds, and other financial products. Access to markets or assets that could be challenging to invest directly is made possible via unit trusts. Additionally, a lesser investment expenditure will allow you to participate in a variety of assets, which could be more expensive if you made individual investments. Compared to bonds and fixed deposits, unit trusts are riskier, but they also provide a lot of versatility, liquidity, and diversification.
DBS and other unit trusts are administered by highly skilled and knowledgeable fund managers, and you can oversee your investment through the online platform for unit trusts.
Real Estate Investment Trusts (REITs)
Investing in units of a REIT is the most straightforward way to profit from a gradually expanding real estate market without having to make a big cash outlay or purchase a property. Owning a properly managed property portfolio that generates consistent dividends through rental revenue is what REITs are all about. However, because REIT units can be traded on a securities exchange, they are more vulnerable to market fluctuations, making them riskier. Furthermore, no capital guarantee exists.
The stock market is a popular place to invest. Day trading, in which an investor purchases stocks and sells them at a significantly higher price within a single trading day, and long-term investing, in which an investor purchases a stock and holds onto it for a considerable amount of time, are two examples of active investing. You can trade both short-term and long-term on 15 major stock exchanges using DBS Online Trading platform.
Exchange-traded funds (ETFs)
ETFs provide a passive approach to share investment, allowing investors to follow a certain index, such as the Straits Times Index or a stock or resource index. To put it simply, an index is a group of stocks that represents a sample of all the stocks in a market or portfolio. It can be used to monitor market or portfolio performance and statistically measure changes in the equities it represents.
You can obtain exposure to the index’s constituent parts by investing in exchange-traded funds (ETFs) rather than purchasing individual stocks or bonds. Compared to actively managed funds, this kind of investment is typically less expensive and more diversified. ETFs do not, however, guarantee principal, and in some circumstances, you could lose all or some of your investment.
CPF Special Accounts
Did you know that you can optimize the funds in your Central Provident Fund (CPF) account to fit your investment goals? You can earn substantial tax benefits and risk-free interest by opening and funding your Special Account (SA). The SA is a good way to save for retirement because it now offers interest rates as high as 5%.
Developing your wealth through investing comes down to knowing your financial objectives, knowing your investment possibilities, and determining how well your options and financial goals align. The dangers that affect your investment might be decreased with a diversified investment portfolio.