An investment in knowledge always pays the best interest.

- Benjamin Franklin

If you are reading this I can assume you know how to get online and is perhaps looking to do self-directed investing online. (Sorry for the jargon, it simply mean investing yourself).

In this first installment on Unit Trust Investing, I will introduce how to get started.

To begin, you need to have an investment account with one of the online unit trust vendors.

Using online Unit Trust sellers offers certain advantage over going through an agent or bank such as,

1. Lower transaction cost. Without a middle-man commission, most retailers pass the discount the saved to the customer.
2. Buy any time. Most working professionals research and make purchase at the comfort of their home at night.
3. Less pressure. Bank counter staff or agent can be pesky and pressurizing and their recommendation may not be in your best interest.

I personally recommends FundSuperMart (Shouldn’t they be paying me for sending customers to them?)

Other online vendors I know are Finatiq, DollarDEX and POEMS.

Even if you do not know anything about unit trust, get an account first. It will keep you excited and want to learn more.

Go ahead and setup an account with one of them. Or if you are like me, with all of them.

Any comments on the online retailers or tips for beginners? Share a comment.

dollarDex transformed their business model from their original online loan and financing model to include distributing unit trusts.

Things I like about dollarDEX

1. Investing with credit card.
   This is a killer feature and appeal to those that likes to mange their finance with credit card. Effectively you can use the credit money in advance and at the same time accumulate reward points for your card.
   Although not all fund can be brought with credit card, this concept alone deserves full point.
2. Performance chart comparing to CPF and bank deposit.
   A nice simple chart that all other sites should have but don’t.

Things that dollarDEX can improve

1. Browser friendliness.
   Since I use Firefox, dollarDEX is the only site among the 3 that I have to switch to IE in order to use it. As a result I hardly ever visit it.

Of the 3 online unit trust retailers, Fundsupermart (FSM) is my favourite site for unit trust investing in Singapore.
What I like about fundsupermart.

1. Good, informative, original articles. Unlike the other sites, FSM has editors that research and write articles. This set them apart from sites that uses fund managers stories. They also publish a magazine. Having SPH as an investor does shows.
2. Simple and easy to use user interface.
3. Good set of functions to search, compare and chart funds.
4. Only unit trust site with a forum. This actually show that FSM “get it” when comes to online interaction and leveraging the online media to reach out and create community.
5. SGS bonds. Though I don’t buy them, they are a good concepts and add to the investment mix. This and beening the first CPFIS Investment Administrator show that They are creative in delivering value to customers.

What fundsupermart can improve on.

1. Articles are getting more “markety“. More objective and well-researched article please.
2. Function to chart investment over time.
3. Graph or table to compare invested amount against CPF or bank return.

With commission of online unit trust retailers half that of banks/brokers, it make sense to use online brokers to save on the charges.

In Singapore, I know of 3 pure online distributors – FundSuperMart, FinatiQ and dollarDex. (Please share with me if you know of others)

Some banks and securities houses like Phillip Securities’s POEMS also allows buying of unit trust online.

Buying online is simple and easy, saving not only money but also time. In future posts, I will be sharing my experience with these distributors.