It’s no secret that cryptocurrency is infamous for its volatility, speculative nature, and vulnerability to cybercrimes and theft — which have led investors to lose millions of dollars.
In fact, MAS has even released a guideline to discourage public trading of cryptocurrency, deeming it ‘too risky’ for the general public.
Despite its tendency for sharp movement in prices, cryptocurrency has given insanely high returns. In 2020 for example, Bitcoin had a maximum annual return of 302%. In 2021, the return was 57.6%.
What’s more, Bitcoin, which is one of the most ‘stable’ cryptocurrencies around, has become less volatile over the years as more investors are starting to believe in its future value.
That said, its volatile nature and unpredictability make it unsuitable for most investors. But, if you’re going to invest in cryptocurrency, the recommended way is to invest in the top 10 cryptocurrencies which are considered to be more ‘stable’.
As a matter of fact, Twitter user @TenIndex has been running an experiment of investing US$100 monthly into the top 10 cryptocurrencies since 2018 to see if cryptocurrencies are good investment choices. In most cases, he’s managed to generate positive returns so far.
Update: As of 8 August 2022, crypto platform Hodlnaut has stopped user withdrawals, token swaps and deposits. The company also applied for judicial management in Singapore on 13 August in a bid to avoid forced liquidation of its assets.
Looking for a less risky way to invest? Sit back and relax without having to lift a finger with one of the best robo-advisor platforms in Singapore.
4. High-interest savings account
Speaking of savings accounts, you can also deposit your money into a high-interest savings account. Though the interest isn’t as high as it was during the pre-COVID days, it’s nonetheless a good way for your money to earn interest without working for it.
Furthermore, unlike a bond or fixed deposit, there’s no penalty or waiting period if you want to withdraw your funds from a savings account. This makes it handy if you want to access your money quickly in case of an emergency.
Also, each bank offers additional interest rates if you fulfil certain conditions, such as spending on credit cards, paying for insurance/home loans, making investments, crediting your salary, etc. For example, the DBS Multiplier account offers up to 3% a year based on salary credit, transactions, and the account balance in your account.
Compare the best interest rates across the best savings accounts in Singapore to let your money work harder for you.
Singapore’s property market is known for being an attractive investment among investors. However, with property prices climbing steadily (and faster than the median income raise), investing in property is becoming increasingly expensive.
But there’s a less expensive way to “own” properties: real estate investment trust, or REITS.
In fact, according to a DBS study, investing in REITS not only offers better diversification, but also provides a yield of 5 to 6% on average, which is higher than 2% for property.
REITs offer good passive income through dividend payouts, but you can also receive capital gains when the REITs gain in value.
Investing in REITs is similar to stocks; you need to purchase REITs through an online brokerage account. Like stocks, they’re also highly liquid and you can buy and sell them anytime you want.
Aside from that, you can also purchase REITs through unit trusts, REIT exchange-traded funds or robo-advisors.
While REITs are considered to be low risk, they’re traded publicly on the stock market, which has some volatility. Also, the dividend distributions are dependent on their rental income; lower occupancy rates and rental income will result in lower rental collection, which results in lower dividend yields as well.
If you're unsure which Singapore REIT to buy, here are some of the best Singapore REITs to invest in.
And there you have it, five investments that are better than buying Toto. While it’s tempting to try your luck at winning the lottery, the probability of getting a good (or any) return is poor.
These are hardly the only investment methods to grow your money. Also remember that your investment strategy depends on your risk appetite and the duration you plan to invest. But mostly, remember to diversify your portfolio and do your due diligence on the company you plan to invest in.
Read these next:
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All The Hidden (And Not-So-Hidden Fees) To Know About When Investing In Stocks
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Guide To Real Estate Investment Trusts (REITs), And Whether You’re Ready For It
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