what's the difference between the same ETF but listed in SGX and HKEX? Arent they the same ETF but only traded in different currencies?

If we were to buy from SG/HK, what would be the cheapest to fund the trading account in SG/HK?

All of them listed is US, HKEX or SGX is traded in USD only.

Just the company structure is different, those listed in SGX and HKEX is offshore, so they are not subject to US tax.

how do you transfer RM to SG/HK for payment of these ETFs purchase?

By TT? Or you can buy through MY broker, but more expensive...

This post has been edited by gark: Jun 11 2013, 04:33 PM

MGM and Gark,

Thanks for helping out on this thread...

Dreamer

Folks,

Now, we want to go into step of how to invest additional money.

A) You have additional 1K to invest.

VT had went up $100, BND had dropped to $60..

So, VT @ 120 share = 120 X $100 = $12,000

BND = 50 shares @ $60 = $3000

Total = $15K

VT = 12,000 / 15,000 = 80%
BND = 3000 / 15000 = 20%

Your goal is to keep the fixed 60/40 ratio. Since the BND is below the targeted 40% ratio, you use $1K to buy BND 1000 / 60 = 16 shares @ $60 = $960.

Dreamer

You have additional 1K to invest.

VT had went down $25, BND had went up to $160..

So, VT @ 120 share = 120 X $25 = $3,000

BND = 50 shares @ $160 = $6000

Total = $9K

VT = 3,000 / 9,000 = 33% < 60%
BND = 6000 / 9000 = 67% > 40%

Your goal is to keep the fixed 60/40 ratio. Since the VT is below the targeted 60% ratio, you use $1K to buy VTI 1000 / 25 = 40 shares @ $25 = $1,000.

Dreamer

You have additional 1K to invest.

VT had went down $25, BND had went down $20..

So, VT @ 120 share = 120 X $25 = $3,000

BND = 50 shares @ $20 = $1000

Total = $4K

VT = 3,000 / 4,000 = 75% > 60%
BND = 1000 / 4,000 = 25% < 40%

Your goal is to keep the fixed 60/40 ratio. Since the BND is below the targeted 40% ratio, you use $1K to buy BND 1000 / 20 = 50 shares @ $20 = $1,000.

Dreamer

This post has been edited by dreamer101: Jun 12 2013, 07:05 AM

You have additional 1K to invest.

VT had went up $75, BND had went up to $100..

So, VT @ 120 share = 120 X $75 = $9,000

BND = 50 shares @ $100 = $5000

Total = $14K

VT = 9,000 / 14,000 = 64% > 60%
BND = 5000 / 14,000 = 36% < 40%

Your goal is to keep the fixed 60/40 ratio. Since the BND is below the targeted 40% ratio, you use $1K to buy BND 1000 / 100 = 10 shares @ $100 = $1,000.

Dreamer

FYI, the returns of those non-US -domiciled ETF are adjusted for the dividend tax withholding.

One may want to check for the tax treaty between the domiciled country and US.
For instance, Ireland-domiciled Vanguard S&P 500 (VUSA) is subjected to 15% dividend withholding instead of the normal 30%.

Another thing to take note is the estate tax imposed by US: Stocks are treated as U.S. gross estate and there's only $60k tax exemption for non-resident alien.

Folks,

We had gone through

1) Set an asset allocation ratio

2) How to invest extra money into that asset allocation.

Now, we are going into re-balancing. There are two common kind of rebalancing: time based and band based.

Let's start with time based. In this case, you pick a time to rebalance your portfolio to the fixed ratio. The most common time based rebalancing is annual rebalancing. You pick the same day every year to rebalance your portfolio.

For example, you are on 60/40. at November 1 every year, you will rebalance.

Let's assume that you have 200 shares of VT at $100 and 100 shares of BND @ $120.

200 X $100 = $20,000 of VT
100 X $120 = $12,000 of BND

Total = 20K + 12K = 32K

VT 20K /32 k = 62.5% > 60%
BND 12K / 32K = 37.5% < 40%

So, you need to sell 2.5% of your portfolio (32K) = $800 of VT to buy BND in order to get back 60/40 ratio.

You sell 8 shares X $100 of VT = $800 and buy 6 share x $120 of BND @720.

Dreamer

Hi, I recently found out that some brokerages are offering commission-free ETFs. Brokerages like Charles Schwab, Fidelity and TD Ameritrade. I think Ameritrade has the best choices of ETFs so far. I am only a student and don't have enough money to invest yet, but you guys might want to check it out. And if you are satisfied with their service, please let me know.

For anyone interested in asset allocation, I recommend William Bernstein's Four Pillars of Investing. You can get it from Amazon for $30 ($20 plus $10 for delivery. Assuming you only order 1 book). It's not as technical as his first book The Intelligent Asset Allocator which explains a lot about Modern Portfolio Theory, but Four Pillars teaches you a lot about market history and investor psychology (behavioral finance). It also explains why the finance industry sucks big time. As someone who was once an insurance agent, I can attest to that. Anyone got books to recommend for me, please let me know.

This post has been edited by JohnL77: Jun 13 2013, 03:23 PM

http://www.betterworldbooks.com/the-four-p...0071747059.aspx

JohnL77,

You can get that book used and cheaper whenever it is available on above url. Free shipping too.

Dreamer

Haha, thanks but I already have the book. Urm... I think Amazon is still cheaper? $30 vs $35.65 new. Plus, you can reduce the shipping cost for Amazon if you buy more than one book. (They charge a fixed $4.99 per order and $4.99 for every book. So if you order multiple books, that fixed $4.99 is spread amongst your books.)

This post has been edited by JohnL77: Jun 13 2013, 06:44 PM

JohnL77,

You do not get IT. That particular used book is not available at that web site at the moment. When it is available, you can get it less than $10 including FREE shipping worldwide.

Most used books in that web site sell for $4 with FREE shipping worldwide.

Dreamer

Oh... okok. I see. Nice.

This post has been edited by JohnL77: Jun 13 2013, 10:54 PM

Folks,

The other kind of rebalancing is called band based rebalancing. The most commonly used band based rebalancing is 5/25. In this case, the first 5 refer to 5% of the portfolio. And, the 25 refer to 25% increase or decrease.

Let's take a portfolio of 100K, the targeted % for asset A , B, C are 60, 30, 10. 5% of 100K is 5K.

For Asset A, for it to trigger the 5 rule, A has either to be lowered than (60 - 5) = 55 or higher than (60 + 5 ) = 65. For A to triggered the 25% rule, A has to be lower than ( 60 * 75%) = 45K or higher than ( 60 * 125%) = 75K.

For 5% rule, 55 < A < 65. For 25% rule, 45K < A < 75K

For A, given that the 5% portfolio rule is narrower than the 25% rule, A will be kept between 55 and 65. When A is below 55, you buy A. When A is above 65, you sell A.

Dreamer

Folks,

For asset B, the 5% rule, means that B has to between 25K and 35K. For the 25% rule, B has be between 22.5K and 37.5K. Given that 5% rule is narrower than the 25% rule, it will be trigger first. Hence, for 5/25, B is kept between 25K and 35K.

For Asset C, the 5% rule means that C has to be between 5K and 15K. The 25% rule means that C has to be between 7.5K and 12.5K. The 25% rule win.


In summary, for 5 / 25 rule and A/B/C of 60/30/10

55 < A < 65
25 < B < 35
7.5 < C < 12.5

If A, B or C cross those threshold at ANY time, they are sold or bought back to the targeted amount.

Dreamer

Dreamer,

Nice concept. Any statistical reason why this 5/25 rule should be followed? Do you know how to value average?

JohnL77,

<<Any statistical reason why this 5/25 rule should be followed?>>

This is the most common percentage and it works for most asset classes. The GOAL is to avoid trigger rebalancing too frequently but trigger enough to avoid a bubble to overload your portfolio and expose to high risk.

For example, with asset class like commodity, the band may need to be larger since they are a lot more volatile.

<<Do you know how to value average?>>

http://www.investopedia.com/terms/f/famaan...factormodel.asp

I do not understand what you are asking... But, according to FAMA French, exposure to Small Value stock asset class is useful and rewarding. So, if you are interested, you can add small value stock index as an asset class into your portfolio and follow the asset allocation model.

Dreamer