DBS, OCBC & UOB all have high potential, but which stocks should you invest in 2021? This guide explains everything you need to know.
When it comes to digital banking, Singapore is ahead of the curve. By 2025, around 1/3 of the Singapore adult population will have a digital bank.
We know you are thinking, “what does this have to do with me?” Well, as Singapore banks are booming, an investment opportunity arises.
Read on to learn about Singapore banking stocks you should invest in this year.
Singapore’s DBS bank has been on the top of investors’ minds for a while. During the first quarter of 2021, the bank, known as the best bank in the world, hit an all-time high.
Does this mean you should start investing in DBS now? Not quite.
If we’ve learned anything from the ‘Dogefather,’ (shoutout to Elon Musk), we know the stock market is going to do what the stock market does. You can’t always force something to be the next big thing.
Although Dogecoin did shoot up, it is currently experiencing a downfall at the time of writing this article. This is not to say that DBS is going to experience the same thing, but it is always a risk.
However, the stock market, in general, is a risk. That’s what makes it so fun! It’s like going to the casino, you know you should stop gambling, but you just can’t because of that ‘what if’ factor.
Experts are predicting a slowdown of DBS and no major increase in rates throughout the rest of this year. Currently, you can buy DBS at $38 per share.
Because this stock is pretty inexpensive, it does not pose much of a financial risk unless you use all of your money investing in DBS.
P.S. investing your money in only one stock is never a good idea. Diversify that portfolio!
Like DBS, investing in OCBC is for the long game investors. Singapore banks have attracted many investors for being cheap and stable.
If you’re an avid investor, you probably spend hours peeking at your stocks throughout the day. As they start to go up, you don’t want to even move from your spot because your superstition is telling you that it has something to do with the increase.
It’s okay to move, we promise the stock can’t see you.
When investing in OCBC, you won’t have as much anxiety. Even the day-to-day movement is pretty stabilized while other stocks tend to move every second.
You may have heard OCBC in the news lately because they appointed the first female CEO, Helen Wong. She took over the bank in April of this year.
If you’re an investor looking for the cheapest valuations, OCBC bank is your dream stock. You likely won’t make money fast, but at around $18 per share, it is worth a shot for the long-term.
If you are looking for the lowest of the Singapore stocks, OCBC is it! Because of their low price, the dividends are also lower.
Last year, UOB had a 4% dividend yield for the entire 2020. Those looking for high dividend yields are sure to find it when investing in UOB.
What does this mean exactly? It means more Dolla Dolla bills, y’all!
Out of the three Singapore banks, UOB has the smallest market cap. At the time of writing this article, you can buy UOB for $25.75 per share.
Although the Singapore banks are slow movers in the stock market, UOB has a pretty steady upward trend going in 2021. You can see that trend with this graphic.
Although all stable options, UOB might be the best out of the three in terms of stabilization.
How to Invest in Singapore Banks
These three banks are stocks you should invest in if you consider yourself more of a long-term investor. AKA start saving for retirement now before it’s too late.
Ultimately, none of the three stocks is a bad idea to invest in. Although slow risers, there is less risk because, more than likely, there won’t be a fast dip. Although the market is volatile, it is a little different with these banks.
Well, I guess now is the time to pop the question…
Are you ready to invest in these banks?
If so, you have a few different options to get started.
If you’re ready to bank on one stock, you can start investing by purchasing directly from the stock market. You can do this through your brokerage account.
You can also download an investing app to buy any of these three stocks.
An RSP, otherwise known as a regular savings plan, can help you make recurring investments through automatic purchases. Each month, you’ll have to place the minimum amount in one or multiple of the three stocks.
Like we stated above, these stocks are less risky than most, so starting your savings through them is not a bad option. Maybe you’ll be able to buy that Lambo quicker than you thought.
The final option is purchasing an ETF, an exchange-traded fund, that tracks the STI. Because bank stocks make up a chunk of STI, this is an often sought out method.
Through this, you won’t just be investing in only these three Singapore stocks. You’ll actually create a more diverse portfolio as the STI includes around 30 companies with other blue-chip stocks.
You can purchase an ETF with either of the above options, through your brokerage account or buying an RSP.
Stocks You Should Invest in This Year
Do you know what time it is? It’s time to start investing in Singapore banks!
You don’t have to be a long-time investor to know that Singapore stocks are great long-term options. There’s nothing left to do except make your first investment today!
After the deed is done, check out our other articles on investments.