Please advise on this UTPortfolio setup

[Venturis]

Below is my current plan for a UT portfolio.
1) I have already set aside 3mth salary for emergency in bank and in addtion a small portion of cash will also be added to MMF each month (I guess this will be needed for housing related expenses in 3-5yrs time).
2) No intention to further invest using CPF. OA will be use solely for housing in future and I'm comfortable with 4% for SA for now.
3) Time horizon 10-15yrs+/ Contribution: Monthly contribution of ~$800.

Equity (70%) - For a start will be keeping the 5 equities at approximately in equal portion, eg.14% each:
Infinity U.S. 500 Stock Index Fund
Infinity European Stock Index Fund
Aberdeen Pacific Equity Fund
UOB United International Growth Fund
DBS Shenton Global Opportunities Fund

Bonds (20%) - Any bonds that i should be taking a closer look beside the below?
Legg Mason Global Bond Trust
AIGIF Singapore Bond Fund (is having reits in here a concern? I believe part of the global equity above already have reits in them.)

For the final 10%:
i) Put it in a resource fund or others to further diversify? First State Global Resources or UOB United Gold & General Fund?
ii) May also shift this to bonds to up it to 30%.

Are 6-8 funds manageable? Initial thoughts to have the Infinity and Aberdeen, is to allow me the flexibility to tweak the % allocation of the regions when the 2 global funds sway the balance too much towards one region.
With the recent expectation and the STI taking a dip, should I be holding on for awhile before I initiate my UT portfolio? Or it really doesnt matter due to the long time horizon that I'm planning for?

All advises are welcome, pardon me if my plans above seems silly or naive.

[Drizzt]

if you have 2 global funds, u shouldnt need the 2 infinity funds. i think u can keep it simple.

[genie47]

You got too many funds overlapping so many markets.

Are you the type who won't fuss and turn grey over the market. Don't mind a portfolio being BORING? I suggest the lazy portfolio by choozm. If not and you want to lower your cost of investing, a lazy portfolio involving a mix of ETFs and UTs and REITs.

[Venturis]

Thanks for the advise, let me try to understand the them here.
So it will be better if I choose one of the below arrangment? So as to simplify the portfolio and to minimize overlapping in the funds?

Scenario 1:
Global Fund + Equity 70%(at 40/40/20?)
- To allow the 2 global fund's to auto pilot, from what i gathered it seems that these 2 funds' nature of investment complement each other pretty well. Aberdeen is added to provide more exposure to Asia?
UOB United International Growth Fund (28%)
DBS Shenton Global Opportunities Fund (28%)
Aberdeen Pacific Equity Fund (14%)
Bonds 20-30%
Legg Mason Global Bond Trust (20-30%)

Scenario 2:
Equity 70% (% allocation either by market capitalization or split evenly)
Infinity U.S. 500 Stock Index Fund (23%)
Infinity European Stock Index Fund (23%)
Aberdeen Pacific Equity Fund (24%)
Bonds 20-30%
Legg Mason Global Bond Trust (10-20%)
AIGIF Singapore Bond Fund (10%) (To diversify the bonds and gives a bit of reits exposure)

* Optional - $ to come out from the bonds portion: To add resources or Japan fund (for scenario 2), to diversify the portfolio further.

As its a long term commitments, "boring" is fine, so that we can all spend more time in enjoying life rather than growin grey hair. But if it can be intersting enough to make me check on the staus say fortnightly, will be nice too.

[sgh]

Just a sidetrack, don't be misled by the name of the UT. E.g DBS Shenton Global Opportunities touted as global but a glance at the factsheet reveal over 50% is invested in Asia so essentially I will treat such UT as Asia Pacific fund. The global just give the fund manager the leeway to invest in other countries beyond Asia. A truly global fund I saw is Aberdeen Global and UOB Intl Growth.

Likewise I was almost fooled by Fidelity South East Asia fund name but on close look it is Asia Pacific!!! A truly SE Asia is Lion Capital South East Asia.

So lesson learnt is read the factsheet and NOT the UT name to determine what it is doing. UT name can be misleading.

[Ra]

I will choose #2 but not sure about bond part. If I were u, I will rather go 100% equity for the early yrs.

[genie47]

I'll go with scenario 2 but it lacks Japan. No faith in Japan?

[Khai84]

i have no faith in japan too!

[genie47]

I find this lack in faith in Japan disturbing. We are lapping up Nipponese cars, TVs and stuff. They account for about 10% of the global market capitalization. Surely it can't be that bad. Anyway, my Japan fund isn't losing money. It is stagnant.

[genie47]

Consider this 5 fund 20% portfolio for easy management.

20% Infinity 500
20% Infinity Europe
20% Aberdeen Pacific Equity (or UOB Regional Growth which includes Japan)
20% Any global REIT fund
20% Legg Mason Global Bond Trust.

[Venturis]

I find this lack in faith in Japan disturbing. We are lapping up Nipponese cars, TVs and stuff. They account for about 10% of the global market capitalization. Surely it can't be that bad. Anyway, my Japan fund isn't losing money. It is stagnant.

For Japan, I think I'll probably not want it to be anything more than 10% of the overall portolio. So i guess it can come in a little later, after I have built up the base for the rest of the region equity.
Any suggestion for Japan funds, that I should take a closer look?

As for reits, I have pretty limited reading into this and cant really decide for now. Initial thought was actually just to get a slight exposure to it, through AIGIF Singapore Bond Fund.

Should I be considering Income fund for bonds too? Or are they pretty similar to my contribution in MMF?

Still waiting my account application to both Poems and FSM...

[Alanto72]

Lion Cap Japan Growth looks good enuff for a Jap fund.

[choozm]

Just a sidetrack, don't be misled by the name of the UT. E.g DBS Shenton Global Opportunities touted as global but a glance at the factsheet reveal over 50% is invested in Asia so essentially I will treat such UT as Asia Pacific fund. The global just give the fund manager the leeway to invest in other countries beyond Asia. A truly global fund I saw is Aberdeen Global and UOB Intl Growth.

Likewise I was almost fooled by Fidelity South East Asia fund name but on close look it is Asia Pacific!!! A truly SE Asia is Lion Capital South East Asia.

So lesson learnt is read the factsheet and NOT the UT name to determine what it is doing. UT name can be misleading.

Ya, that's active management for you.

[choozm]

hi,

Initial thoughts to have the Infinity and Aberdeen, is to allow me the flexibility to tweak the % allocation of the regions when the 2 global funds sway the balance too much towards one region.

if you want to have rebalacing control over region allocation, then why use global fund and face the trouble of fund manager messing around your allocation?

if you don't care to to have rebalacing control over region allocation, then a global equity fund is good enough.

IMHO, take either one to avoid overlap. Keep it simple.

Scenario 1:
Global Fund + Equity 70%(at 40/40/20?)
- To allow the 2 global fund's to auto pilot, from what i gathered it seems that these 2 funds' nature of investment complement each other pretty well. Aberdeen is added to provide more exposure to Asia?
UOB United International Growth Fund (28%)
DBS Shenton Global Opportunities Fund (28%)
Aberdeen Pacific Equity Fund (14%)
Bonds 20-30%
Legg Mason Global Bond Trust (20-30%)

From the above reply: overlap.... Also might want to sum up total Asia % from the the two global funds and Aberdeen, to see if it is too much Asia..

Scenario 2:
Equity 70% (% allocation either by market capitalization or split evenly)
Infinity U.S. 500 Stock Index Fund (23%)
Infinity European Stock Index Fund (23%)
Aberdeen Pacific Equity Fund (24%)
Bonds 20-30%
Legg Mason Global Bond Trust (10-20%)
AIGIF Singapore Bond Fund (10%) (To diversify the bonds and gives a bit of reits exposure)

Bond is bond, REIT is REIT. They are different asset classes. REIT should be put under equity, if you want REIT.

If you let AIGIF Singapore Bond Fund to manage your bond part, imagine one fine day the fund manager decides to increase its REIT allocation, then the safe anchor of your porfolio (bond), will be reduced below 20% and increase your portfolio risk (due to larger equity portion). Or the fund manager removes all REIT, and suddenly you have no REIT when you have allocated for it.


just my 2 cents,
cheers

[genie47]

Any suggestion for Japan funds, that I should take a closer look?

DBS Japan Growth. Low ER, looks OK for a consistent past but not overwhelmingly outstanding performance.

[Venturis]

Bond is bond, REIT is REIT. They are different asset classes. REIT should be put under equity, if you want REIT.

If you let AIGIF Singapore Bond Fund to manage your bond part, imagine one fine day the fund manager decides to increase its REIT allocation, then the safe anchor of your porfolio (bond), will be reduced below 20% and increase your portfolio risk (due to larger equity portion). Or the fund manager removes all REIT, and suddenly you have no REIT when you have allocated for it.

hmm... this helps me to understand much better.
So to really allow my portfolio to be "controllable" as far as % allocation goes, I should go for something similar to scenario 2, but for the bond portion should stick with something pure (maybe Legg Mason Global Bond Trust or DBS Enhanced Income *need to double check on the factsheet again to see if there's any REITS* or a combination)

I guess I will just hold on till later to decide on REITs and if its desirable I'll slice a 10% allocation out of equity for this.

BTW the responses from this forum is really very informative and helpful for beginners like me.

[Hulumas]

Dear Venturis,

How is your fund performance so far? Are you getting well and useful advices so far from Sgfund fotum?