SRS investment options

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malcontent
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Re: SRS investment options

Post by malcontent » Thu, 29 Jul 2021 11:58 am

Interesting… I hadn’t heard of the Nasdaq India Index before, only the Nifty 50. NFTY has more than doubled since the Mar 2020 low, not a bad run at all!

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Re: SRS investment options

Post by smoulder » Thu, 29 Jul 2021 12:09 pm

malcontent wrote:
Thu, 29 Jul 2021 11:58 am
Interesting… I hadn’t heard of the Nasdaq India Index before, only the Nifty 50. NFTY has more than doubled since the Mar 2020 low, not a bad run at all!
No you misunderstood. It's an ETF available in the 2 major Indian exchanges, the NSE and BSE, that tracks the nasdaq 100, meaning exposure to the US. Unfortunately there isn't a similar S&P500 tracking ETF available there.

And yes, the Nifty50 and the sensex have been doing pretty well over the past couple of decades and especially since March 2020.

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Re: SRS investment options

Post by malcontent » Thu, 29 Jul 2021 12:48 pm

Ah, ok… now I understand.

Any reason you need to stay on NSE/BSE or can you go to LSE for your non-India exposure?

For non-US persons looking for US exposure, LSE definitely has the lowest expense (0.07% for CSPX/VUSD) and least dividend withholding (15% Ireland domiciliary rates), and no concern about any US estate tax traps.

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Re: SRS investment options

Post by smoulder » Thu, 29 Jul 2021 1:41 pm

malcontent wrote:
Thu, 29 Jul 2021 12:48 pm
Ah, ok… now I understand.

Any reason you need to stay on NSE/BSE or can you go to LSE for your non-India exposure?

For non-US persons looking for US exposure, LSE definitely has the lowest expense (0.07% for CSPX/VUSD) and least dividend withholding (15% Ireland domiciliary rates), and no concern about any US estate tax traps.
Oh this is just what I'm doing with money I hold in India... Eventually I will sell off all these investments, take the cash and transfer it to Singapore, where it will be added to my portfolio. Transferring out of India is a painful process which will require a trip to a chartered accountant. Plus I have property to sell there and also add to the cash that I will transfer. It warrants a few trips to India and hence I'm not in any hurry. In the mean time, it's being invested and getting me some decent returns.

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Re: SRS investment options

Post by Meo » Wed, 11 Aug 2021 2:23 am

singaporeflyer wrote:
Mon, 26 Jul 2021 3:39 pm
We should set up a small telegram or whatsapp group for people who are interested in investing / SRS
If you don't mind letting newbies join the group to learn, I would like to book 1 slot :D excited!!! exactly what i was looking for.
Cheers.
Meo

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Re: SRS investment options

Post by malcontent » Wed, 11 Aug 2021 10:32 am

There is another forum specialized in this, and there is a well developed recipe for investing here, as outlined in this post —

https://forums.hardwarezone.com.sg/thre ... -135896556

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Re: SRS investment options

Post by singaporeflyer » Wed, 11 Aug 2021 5:14 pm

What is the cost effective way to invest SRS in SP500 and IWDA/VWRA?

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Re: SRS investment options

Post by smoulder » Wed, 11 Aug 2021 10:05 pm

singaporeflyer wrote:
Wed, 11 Aug 2021 5:14 pm
What is the cost effective way to invest SRS in SP500 and IWDA/VWRA?
S27 is the lowest cost method.

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Re: SRS investment options

Post by malcontent » Thu, 12 Aug 2021 8:40 am

Annually, you’ll be paying 0.095% management fee plus losing 0.372% (30% x 1.24% dividend yield) on dividend withholding for S27, so 0.467% in total.

The next best option is Lion Global Infinity US 500 unit trust, you’ll be paying a combined 0.67% management fee (underlining Vanguard fund plus Lion Global) plus the 15% withholding tax on dividends which Vanguard Ireland pays tax on US dividends - that adds another 0.186% for a total 0.856%. However, this does not including any other annual charges by the platform - for example, unless you are a diamond client, Fundsupermart (one of the cheapest) charges 0.0875% per quarter for SRS/cash, so that adds another 0.35% per annum, for a grand.. total.. of 1.2% per annum!

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Re: SRS investment options

Post by singaporeflyer » Thu, 12 Aug 2021 11:39 am

malcontent wrote:
Thu, 12 Aug 2021 8:40 am
Annually, you’ll be paying 0.095% management fee plus losing 0.372% (30% x 1.24% dividend yield) on dividend withholding for S27, so 0.467% in total.

The next best option is Lion Global Infinity US 500 unit trust, you’ll be paying a combined 0.67% management fee (underlining Vanguard fund plus Lion Global) plus the 15% withholding tax on dividends which Vanguard Ireland pays tax on US dividends - that adds another 0.186% for a total 0.856%. However, this does not including any other annual charges by the platform - for example, unless you are a diamond client, Fundsupermart (one of the cheapest) charges 0.0875% per quarter for SRS/cash, so that adds another 0.35% per annum, for a grand.. total.. of 1.2% per annum!
Are you using S27 for SRS too? via which broker?

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Re: SRS investment options

Post by malcontent » Thu, 12 Aug 2021 12:12 pm

Yes, all of my SRS money is invested in S27.

I use UOBKH because they were one of the only ones who would accept US persons. Commission is US$18 per trade, so I usually try to buy 20 shares at a time - but lately I just don’t care and bought 10 shares if I have the money. After all, I’m holding until at least 2030, so the sooner I get in the better (usually). Just note there are some quirks with online trading, which I discussed earlier in this thread.

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Re: SRS investment options

Post by oceanphilic » Thu, 26 Aug 2021 10:27 am

malcontent wrote:
Wed, 28 Jul 2021 5:54 pm

Well said Wd40, you definitely have look at your portfolio as a whole… leverage SRS based on best investment options available to SRS accounts that still fits with your overall portfolio goals.

For me personally, I do not wish to overweight SG equities in my portfolio, and with a market cap of just $0.6b versus the entire world at $95t, it means 0.6% allocation in my portfolio (I’m currently at 0.5%). This is why I view S27 as my best SRS investment option that fits my portfolio objectives.

Another thing I like about S27, because SRS has the option to withdraw securities instead of cash, when the time comes I plan to transfer from SRS to CDP, then do a cross border CDP to DTC transfer to a US broker like TDA/IBKR to sell as SPY, so at least when I sell, I’ll enjoy low/no commissions, tight spreads and better exchange rates.
Finally someone who shares my views as well. The tax advantages of doing SRS + S27 outweighs buying CSPX outright (post-tax) if one is in a higher income tax bracket. Some have advocated buying other "more efficient" ETFs using SRS monies - if there're any, I've yet to identify them (non-SG focused ETFs). Even the SGX listed China ETF isn't as efficient as the one in HK [-X

Just curious, is there any online guide to performing the SRS > CDP > DTC transfer? Should we approach IBKR or CDP for advice? Just concerned that IBKR would log it under S27 instead of SPY (unless it doesn't really matter once it's in IBKR since there's international access and it's basically the same thing).

Update: ok I've found the relevant documents here with help from the keywords above (thanks Mal!)
https://www.sec.gov/Archives/edgar/data ... 36d497.htm
https://links.sgx.com/1.0.0/corporate-a ... 202020.pdf

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Re: SRS investment options

Post by smoulder » Thu, 26 Aug 2021 11:21 am

oceanphilic wrote:
Thu, 26 Aug 2021 10:27 am


Finally someone who shares my views as well. The tax advantages of doing SRS + S27 outweighs buying CSPX outright (post-tax) if one is in a higher income tax bracket.
I think you misread. The question is not about cspx vs srs + S27. They are 2 separate things and can be done to compliment each other :

1. Srs + S27 upto 15.3 k which is the max allowed
AND
2. Cspx for money you want to invest over and above 15.3 k.

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Re: SRS investment options

Post by malcontent » Thu, 26 Aug 2021 12:56 pm

And since this is an expat forum, take note that the maximum annual SRS contribution for EP holders is $35.7k (considering you don’t have CPF). Also note that an EP holder can withdraw their SRS in full after 10 years without penalty and you’ll only pay tax on half of the withdrawn amount. If you are no longer resident in Singapore at the time of the withdrawal you will pay 15% on half of the first $320k withdrawn (effectively 7.5%), or resident tax rates if it’s more. The tax savings is essentially the difference between your top tax rate and the future effective tax payable. If you have SPR/SC, even better, you could possibly avoid tax completely on withdrawal.

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Re: SRS investment options

Post by oceanphilic » Thu, 26 Aug 2021 1:12 pm

[/quote]

I think you misread. The question is not about cspx vs srs + S27. They are 2 separate things and can be done to compliment each other :

1. Srs + S27 upto 15.3 k which is the max allowed
AND
2. Cspx for money you want to invest over and above 15.3 k.
[/quote]

Ah yeah, that's what I meant. I doubt the SRS annual limit will be enough and yes, certainly would buy CSPX for any amounts above (assuming still within portfolio strategy/allocation). Was addressing any concerns about choosing SPY over CSPX in an SRS context (which isn't covered properly/much in online articles/finance blogs)

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