SGX-listed stocks lack quality?

Almost a year ago, the Straits Times Index tanked from almost 3500 points to the current 2760 points. The fall in the Singapore stock market benchmark index reflects the challenging economic conditions and those who invested in SGX-listed stocks would have suffered from a certain level of wealth destruction. Incidentally, the market correction started since the previous SGX CEO, Magnus Bocker, was replaced by the current Loh Boon Chye. But the rot probably started during Bocker’s time and it would not be fair to blame the current CEO for this mess.

One thing for sure is that Bocker was highly unpopular during his helm as SGX’s chief because of his slew of projects that did not yield much improvements to Singapore market. The biggest flop definitely had to be the introduction of a new $250 million trading engine that promised to propel Singapore into Asia’s top trading centre. Instead, a massive technical fault in 2014 caused SGX to stop trading for at least 3 hours and left SGX red-faced. To make things worse, this embarrassing incident came after SGX tried to restore confidence following the penny stock crashes involving Blumont, LionGold and Asiasons.

stock market

The penny stock crashes in 2013 probably summed up the lack of quality in SGX-listed stocks. Many retail investors have lost their fortunes investing in these three counters seemingly unaware of the traps that are awaiting them. For example, alarm bell should have been rung when LionGold rose from $0.10 in 2009 to $1.70 in 2013. Such astonishing ascent in price was not normal and the relevant authorities should have intervened much earlier instead of letting them imploded on their own.

Besides these three companies, there are quite a number of “deadwood” listed companies in SGX as well. To improve transparency, SGX recently launched a half-yearly update on the long-suspended companies. There are a total of 20 companies in the list and I am not surprised that the majority are S-Chips – companies with principal place of business in China.

At this point of time, I have sold off all my SGX-listed stocks and focus my wealth portfolio on real assets like gold and real estate. I see no point in losing sleep over stock investments, especially SGX-listed shares. Singapore is supposed to be Asia’s regional financial hub yet the quality of our stock market participants are nothing like those in Australia, Hong Kong and Japan. In addition, I am not sure whether this is the best time to be vested in equities as there are so much uncertainties at the global front and it seems that the market is just waiting for a Black Swan event to ignite. China probably fired the first salvo when its stock market witnessed massive carnage earlier this year. In such situation, my strategy is to ensure return of my capital rather than return on my capital.

Don’t wait until the stock market crashes then you take actions to exit the market. By that time you probably would not be able to sell off your shares. Instead, start accumulating in safe haven assets like gold which has risen by 19% this year on the back of freakish market turmoils. To build wealth with gold, it makes sense to buy gold bullion in Singapore because of the business-friendly government policies which aim to transform the nation into a precious metal trading hub.

In Singapore, you can choose to buy physical gold from BullionStar, one of the largest online bullion dealers with a store-front shop at 45 New Bridge Road. With BullionStar, you can choose to buy gold or silver bullion online and have them delivered to your home or put them into ‘My Vault’ storage in BullionStar’s secure vault storage facility. Alternatively, you can choose to walk in and buy gold and other precious metals at BullionStar shop and showroom premises.

Gold and Silver Bullion
Gold and Silver Bullion

Setting up an online account is pretty simple and you can choose to pay in different currencies, including Singapore dollar and Bitcoins. In addition, the price is very transparency as BullionStar’s website displays the price premium and spread for each bullion. This allows buyers to make price comparisons online before making the purchase.

BullionStar also offers customers their own minted gold and silver bars with zero spread. They have commissioned world-renowned LBMA-approved Swiss gold refiner Argor-Heraeus to produce these stylish and unique minted 100 gram 99.99 % purity gold bars.

Below are some gold bullion offered by BullionStar that are worth buying:

  1. PAMP Gold Bar – 1kg
  2. American Gold Buffalo Various Years
  3. BullionStar Mint Gold (No Spread)

Singaporeans who still think that they can win the stock market should wise up. The matter of fact is that the odds are stacked firmly against retail investors and those who did not diversify their portfolios are taking on big risks. Just one market correction and their wealth would be gone. Instead of risking your hard-earned money on speculative shares, start buying real physical gold from a trustworthy bullion dealer.

Join me in my investment journey and read my financial adventures for free! Through the sharing, my vision is improve and change people’s lives. In school, we don’t learn how to budget, manage our finances, build wealth and invest our money. Instead, we are taught useless subjects which we would never put to use most of the times during our working lives.

Yet, managing our money is an important life skill that is critical to our survival in the society. Many people start to realize how it is importance of managing money only when they face the prospect of financial ruins, by then which would be too late for remedies. Thus, I started this blog to share articles on finances which I aspire to make a positive impact in others’ lives.

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Magically yours,

SG Wealth Builder


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