MIP – Page 3

Top up function available for DBS DigiPortfolio

01.21.2020 by Finance Smiths //

We got an email from DBS today about the top-up function being available for the DBS DigiPortfolio. The last time I wrote about my wife setting up her Asia and Global Portfolios, I expressed my disappointment at how she was unable to increase her investment in them by making contributions.

Instead, she would have to close her existing portfolios and open new portfolios. Which made no sense for this type of investment product. It’s about time this top-up function is made available for the DBS DigiPortfolio.

We logged into DBS Digibank online to play around with this feature. The top-up process for both the Asia and Global Portfolios is simple and straightforward. The email mentions it will take a few days for the respective ETFs to be purchased and reflected in her portfolios.

We are hoping this can be shortened to 1 day, at most 2 days. Otherwise, we have to take into account this lag to invest the transferred funds when she does make contributions. It’s not good for the processing time to be so long since you would want the funds invested once the markets open.

Anyway, we found out there seems to be no way to set up a regular funds transfer into the DBS DigiPortfolio. Which means an automated monthly investment plan into my wife’s Asia and Global Portfolios is out of the question for now.

We are hoping the top-up function can be further developed to allow for automated regular funds transfer into the DBS DigiPortfolio. In addition to being able to top-up whenever and however we like. The main thing is we don’t want to have to manually log into DBS Digibank online each time to do the top-up.

We want to be able to set up a regular investment plan with DBS DigiPortfolio. This forms the Dollar-Cost Averaging part of our investing strategy i.e. has no market timing element to it. Sure, when we see market dips or even crashes, we want the flexibility to manually transfer in larger sums of monies to be invested. But that’s for the Value-Cost Averaging part of our investing strategy i.e. has a market timing element to it.

While this is an improvement to DBS DigiPortfolio, we feel it still has a long way to go when compared to robo-advisors. It’s better than OCBC RoboInvest if it’s any consolation. But traditional banks continue to be slow-moving and inferior in terms of technological advancements of products and services they offer compared to the FinTech Companies.

My view continues to be that traditional banks have only been able to remain profitable because FinTech Companies have not been able to make inroads into core banking businesses. Which is about to change with the advent of Digital Banks. Eventually, our core banking businesses that generate the majority of the profits will come under attack. And traditional banks will be too slow to react – bogged down by legacy systems, people, processes and procedures.

Can’t imagine why people worry about whether Digital Banks will be profitable. There’s so much that can be scalped from the existing profits of traditional banks. If only you realise the amount of excess capacity we are carrying. The number of people that works there just collecting a salary and going through the motion every day. You will be shocked at how long we have been allowed to operate this way.

I am looking forward to the results of the MAS Digital Bank Licenses Applications. And I hope they get awarded soon so that the Digital Banks can start operations after that. I can’t wait to put my skill sets to the test to see whether they are actually value-adding or I have been doing nothing useful at all. If I get eliminated, it just means I’m one of those people and was unable to pivot in time. And I deserve that outcome. Exciting stuff to deal with in time.

Anyway, my wife has planned in the dates of her manual funds transfers into the DBS DigiPortfolio as part of her monthly investment plan. It’s going to be annoying for her to log into DBS DigiBank online each time to do it so I might help her with it. Fixed amounts on fixed dates to be executed manually. Sigh, can you find a way to automate this DBS?

We also adjusted some of our monthly investment plan automated contributions to weight out portfolios in accordance with our earning power. Since my wife earns more than me, her portfolio is weighted towards reinvestment of dividends/distributions i.e. more capital-growth focused. Since I earn less, my portfolio is weighted towards dividends/distributions payout i.e. more income focused. To compensate for my lower salary income. I wonder how will this work out.

POSB Invest Saver – Nikko AM REIT ETF

11.10.2019 by Finance Smiths //

As we settle into a daily routine, pockets of time in the day are opening up, which is a good thing. Overnight feeding is brutal and the baby was up every 2 hours last night to feed. The interval was 3 hours the night before and that was still sustainable but 2 hours is really tough.

I can help out now with the overnight feeding being done in the bedroom since I’m still on annual leave. But my wife might have to do the overnight feeding in the living room once I go back to work. Not sure how I can go through a full day in the office with so few hours of sleep. Maybe in the short term but probably not in the long term.

Anyway, I have more time to blog now as the baby is sleeping and we are resting. While the confinement nanny is cleaning our apartment, getting ready to bathe the baby and prepare lunch afterwards. I saw a post about this on Facebook and logged into my wife’s DBS internet banking account to check.

For my wife’s POSB Invest Saver, we set up a new Regular Savings Plan for the newly added Nikko AM Straits Trading Asia ex Japan REIT ETF (CFA). The monthly investing amount is $200 and I hope it qualifies as a category for my wife to earn higher interest on her DBS Multiplier bank account balance. Will find out over the next few months.

With this, we each have $1,700 of automated monthly investment plans into Singapore Equity & Bond ETFs and robo-advisors. The former has distributions while the former is reinvestments. We try to have a mix of passive income cashflow and compounding growth based automated investments.

As we expected, we have very little time for manual investments now and in the near future. Besides, we just want to focus on enjoying parenthood and being present with the baby. Even as I finish typing this post, it’s time for him to feed now. I’m off to go help my wife!

Allocated Astrea V Bonds and Stopped Maybank Kim Eng MIP

06.22.2019 by Finance Smiths //

There’s been a lot of online commentary about the Astrea V 3.85% Private Equity Bonds so I’m not going to be analysing them here. Last year in Jun 2018, I subscribed to and was allocated S$4,000 of Astrea IV 4.35% Private Equity Bonds. Since the interest rate is lower this time round, I only subscribed to and was allocated S$2,000 of Astrea V 3.85% Private Equity Bonds.

This is an interesting investment type and I reckon it’s worth allocating some funds to it. Besides, the fixed income investment proportion of my portfolio is low so I generally try to subscribe to such retail bonds offerings where possible. As long as the interest rate is above 3.50%. Which is why I did not subscribe to the SIA 3.03% Retail Bond. Plus I usually hold them to maturity.

Anyway, the Maybank Kim Eng Monthly Investment Plan (MIP) has been discontinued from Jun 2019. As such, I have sold off all of my holdings in the prefunded account from my Maybank Kim Eng MIP. I have also increased the investment amounts in our StashAway & Smartly robo-advisors, POSB Invest-Saver and OCBC Blue Chip Investment Plan (BCIP) to make up for the shortfall.

I invest a minimum amount of S$2,500 every month on an automated basis and it is the DCA component of my portfolio. This is regardless of whether the equity markets go up or down. But when there are significant drops in the equity markets, I do adjust the automatic monthly investment amount upwards but generally keep it at a minimum of S$2,500.