A Clear-Eyed Overview of Investment Options
In Singapore, the options for investing are plentiful—shares, bonds, unit trusts, exchange traded funds (ETFs), and real estate investment trusts (REITs) are just some of the choices. Before committing money, it helps to get a clear overview of the major investment products available.
Shares, Bonds, and Unit Trusts
Shares and bonds can be issued through different channels. For example, ordinary shares are often issued via initial public offers (IPOs), while government bonds are issued through tenders. Different asset classes, such as shares, ETFs, and REITs, are listed on the exchange. Unit trusts are another common investment vehicle, though they are not listed on the exchange in the same way.
Income, Capital Gains, and Diversification
Investments can provide income, for example through dividends from shares or interest from bonds. They may also offer capital gains if the value of the investment increases. Unit trusts allow investors to pool money into a diversified portfolio managed by professionals, which can spread risk across different assets.
Understanding these basics helps investors make informed decisions about their portfolios.