Buying Unit Trusts on-line, local banks are in it too

I bought unit trusts in the past from Fundsupermart.com. It performs the independent role of online unit trust distributor for many fund houses.

Now, the three local banks namely UOB, DBS and OCBC allow their savers/customers to buy and sell unit trusts through internet banking, subject to them clearing the Customer Knowledge Assessment (CKA) as stipulated by MAS. (Note: Fundsupermart has to conduct similar CKA on their customers.) CKA is required by law to protect the consumers from investing in some financial products without adequate knowledge of what they are getting into.

One does not have to wait in queue at a bank to buy a unit trust. This process takes too long from waiting your turn, to hearing sales pitch, financial risk assessment and finally transacting. It was really time consuming as far I could remember. The internet banking way is a breeze.

What’s more, the sales charge using internet banking is lower than what is offered at the branch. For example, DBS offers 1.5% discounted sales charge, OCBC offers 1% promotional sales charge, UOB offers 2% sales charge (with a trailer fee of 0.21%). As for Fundsupermart, it does not charge sales charge but it charges platform fee of 0.125% per quarter. (Please access various websites to establish the latest information.)

Buying Singapore equities via unit trust

In recent days, Singapore equities lost values. One could take the opportunity to buy STI Exchange Traded Fund (ETF) from the Singapore Exchange. 1,000 units of STI ETF cost about $3,330 to $3,340 before transaction costs. Instead of investing in ETF, one may consider investing a few thousands of dollars in a Singapore equity fund that is managed professionally by different fund houses.

Two local banks owned their asset management companies: OCBC has LionGlobal Investors and UOB has UOB Asset Management (UOBAM). DBS is closely related with Nikko Asset Management (formerly DBS Asset Management). These fund houses have funds that invest in Singapore equities.

Let’s see some Singapore equity unit trusts listed by date of launch order.

Asset Management Name of unit trust NAV as at 27.7.15 Date of launch
UOB Asset Management United Singapore Growth Fund $3.399 2 March 1990
Nikko AM Singapore Dividend Equity Fund $1.629 2 August 1999
LionGlobal Investors Singapore Dividend Equity Fund $1.010 2 June 2015

Most funds invest in Singapore equities that have a track record of paying dividends. As for LionGlobal Singapore Dividend Equity Fund, please see my blog-post:

https://limkimtong.wordpress.com/2015/06/15/lionglobal-singapore-dividend-equity-fund-sgd/

Disclaimer: Read up more about these funds and consult financial advisors if you re not trained in this area.

Copyright © 2015, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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