Continued... STI ATH (All Time High)! 3 local banks chiong chiong chiong? How? What next for Sporean investors?
- ckcbiz40
- Jan 25
- 7 min read
Continuing from my recent previous blog post [Report Card for 2025 and Onwards to 2026! TBC (To Be Continued...)] on how/where to deploy our monies for 2026.
But before that, I like to share extracts of 4 articles (highlighted in pink) below for some food for thought:
Wait, do you notice something similar?
Bingo! The hype and spotlight on STI hitting all time high throughout 2025 onward to 2026 and whether it can continue its bullish run. But why is everyone so fixated on STI? Yes, I get it that it's the 30 biggest market cap stocks (i.e. blue chips, BUT let's not forget we have our share of blue chips that became blue-black Orh Bak Kak chips, e.g. the postal mail company, the newspaper company, the green star-ry telco 🤣) on the Singapore market.
No, don't get me wrong, I share similar sentiments that there are indeed room to grow for STI and legs to run, for the various reasons stated in the 4 articles above (do click into the links to read the articles in full)! [e.g. Govt/MAS setting committee chaired by Minister/new initiatives of reducing lot sizes, dual listing with Nasdaq + MAS and SGX pumping $5B to boost the local stock market, High Net Worth Individuals/Rich family trust seeking shelter in global volatility, well-known high dividend yield of Spore stocks compared to other markets + Spore's stable economic growth and SGD strength (vs USD)].
For the record, I'm bullish on STI going into 2026 and have egged my wife into starting with STI as I see room for growth both in terms of capital gains and dividend growth. Basically, high can go highER (conversely, low can go lower). But of course, the magnitude for growth and potential upside is anyone's guess! 😉
So Million dollar question is:- Will I buy STI going into 2026? My answer: A resounding NO! Why? (1) STI's dividend yield of 3.8% to 3.9% is below my current yield of 6.5%.
(2) My portfolio currently already comprised almost half (13) of the 30 STI stocks.
(3) Heavy concentration of the 3 banks in STI, esp since my portfolio already covered about 70% weightage of the STI.
Now, coming back to the 4 questions (A) to (D) below which I asked MYSELF in my previous post here: Report Card for 2025 and Onwards to 2026! TBC (To Be Continued...)
(A) Which new Singapore stocks/REITs to deploy next?
(B) Should I double down on my existing holdings?
(C) How to grow my dividend yield beyond 6.5%?
(D) How to increase quantum of annual dividends received?
So how to deploy in order to achieve the above? This is what I've been pondering for some time to go beyond the usual STI component stocks, and I like to shine some spotlight on this new index launched by SGX in Sept 2025 called - iEdge Singapore Next 50 Index, which is the next 50 biggest stocks beyond the 30 STI stocks. This Next 50 Index is part of SGX's plans to boost investor demand and interest in the Singapore market and to improve market liquidity. You can find more details on the Next 50 Index in the announcement here: SGX launches two new indexes to boost investor demand and interest in Singapore stock market | The Straits Times
As for the component stocks of the Next 50 Index, they come from a mixture of industries and sectors and you can find them here (Singapore Next 50 Indices - Explore opportunities beyond blue chips - Growbeansprout.com). I have also pasted them in the table below for ease of reference and I am sure you will notice some familiar names or you have been using their products, patronising their properties, enjoying their facilities etc.
iEdge Singapore Next 50 Index stocks | Sector | Next 50 Weight | Next 50 Liquidity Weights |
REITs | 5.6% | 4.4% | |
REITs | 5.2% | 4.5% | |
Industrials | 5.1% | 5.1% | |
REITs | 5.0% | 3.5% | |
Telecommunications | 4.9% | 2.9% | |
Non-Energy Materials | 4.4% | 1.6% | |
Consumer cyclicals | 3.9% | 1.2% | |
REITs | 3.8% | 2.4% | |
Consumer Non-Cyclicals | 3.7% | 3.1% | |
REITs | 3.5% | 1.6% | |
Financials | 3.4% | 5.3% | |
REITs | 3.3% | 1.7% | |
REITs | 2.9% | 2.7% | |
Yangzijiang Maritime Development Ltd | Financials | 2.7% | 4.5% |
REITs | 2.2% | 3.9% | |
REITs | 2.1% | 3.7% | |
REITs | 2.1% | 1.2% | |
Financials | 1.9% | 4.2% | |
Industrials | 1.9% | 2.4% | |
Industrials | 1.9% | 2.0% | |
Non-Energy Materials | 1.9% | 2.0% | |
REITs | 1.9% | 1.1% | |
REITs | 1.8% | 0.5% | |
Healthcare | 1.7% | 0.9% | |
Technology | 1.7% | 4.5% | |
Consumer Non-Cyclicals | 1.6% | 1.2% | |
Telecommunications | 1.4% | 0.7% | |
REITs | 1.4% | 0.8% | |
Financials | 1.4% | 1.1% | |
Energy | 1.2% | 2.7% | |
REITs | 1.2% | 1.0% | |
REITs | 1.2% | 0.4% | |
Consumer cyclicals | 1.0% | 2.0% | |
Industrials | 1.0% | 0.8% | |
Industrials | 0.8% | 2.1% | |
Financials | 0.8% | 1.4% | |
Consumer Non-Cyclicals | 0.9% | 1.2% | |
Technology | 0.9% | 3.6% | |
REITs | 0.8% | 0.4% | |
Energy | 0.8% | 1.0% | |
Financials | 0.6% | 1.5% | |
Financials | 0.6% | 1.7% | |
Non-Energy Materials | 0.6% | 0.3% | |
Energy | 0.6% | 1.7% | |
Industrials | 0.5% | 0.2% | |
Financials | 0.5% | 2.2% | |
Non-Energy Materials | 0.5% | 0.4% | |
Industrials | 0.4% | 0.2% | |
Non-Energy Materials | 0.4% | 0.1% | |
Source: SGX as of 31 December 2025 | |||
Fortunately or Unfortunately, as of now, there are no ETF launched for the Next 50 Index for now.
I said Unfortunately => because this means investors (esp beginners) are unable to buy the entire basket of the 50 stocks now.
I said Fortunately => because this means we are able to pick and choose our preferred stocks to buy to suit our investment objectives (e.g. for dividend income, for growth potential, for value plays), individual circumstances, investment time horizon, risk appetite and own circle of competence.
Notwithstanding the hype in STI, I believe these Next 50 Index component stocks also stand to gain from MAS' S$5 billion Equity Market Development Programme (EQDP) to boost the Spore stock market and liquidity, and attract capital into Singapore. In addition, the overall favourable macro factors such as strong/appreciating SGD, projected economic growth, shelter from geopolitical volatility also gives tailwing to the Next 50 Index stocks.
But as with a commingled basket, there would be a mixture of SWEET and SOUR apples in the Next 50 Index stocks. So as investors who care about our money, our job is to sieve out the strong companies from weaker one, and a lot depends on the fundamental business, management, valuation of the company behind each of the Next 50 Index stock. As I always remind my friends - We are not buying stock symbols, we are buying shares of the companies as co-owners and we need to know at least know the business. For e.g. Did you know Comfort is not just a taxi company in our little red dot? It is 1 of the largest land transport conglomerates in the world with fleets of private hire cars, taxi. public bus, private coaches, school buses, metro train network and ambulance fleet, EV charging businesses in Europe, Australia, NZ and China! Sometimes I joke with my kids that I probably own a few floor tiles in Ion Orchard + a few window panels in Plaza Sing (for owning Capitaland Integrated Commercial Trust), I maybe own a few pieces of the fibre broadband cables (Netlink trust), and I possibly own a part of an ATM machine (DBS), haha... 🤣
Anyway, back to my 4 key questions (A) to (D):
(A) Which new Singapore stocks/REITs to deploy next? I am personally looking deeper 🧐 into a FEW of the Next 50 Index stocks to suit my investment objectives and timeline (which ones? Take a CLOSER look into the table above 😉).
(B) Should I double down on my existing holdings? Why not? Esp if my business conviction remains or growth fundamentals have grown or shows visibility of potential growth. For context, I own 7 of the Next 50 Index stocks and will study whether to buy more.
(C) How to grow my dividend yield beyond 6.5%? Scrutinise shortlisted Next 50 Index stocks for strong/stable dividend growers before buying into them.
(D) How to increase quantum of annual dividends received? Accumulating $1K per month (from my 2026 Resolution mentioned in my previous post) to fire/prepare to fire into selected Next 50 Index stocks at the right price.
What about you? What are you looking to invest into for 2026? I believe there are opportunities everywhere, we just need to know where to look and be selective + diversify 😁
To your money and health,
Mr MoneyandHealth (Mr MH) 🥰
Disclaimer: The author is NOT endorsed by any companies mentioned above to write this post. The author may have been, is still vested, will be investing into several of the companies mentioned above. The above article is just the author expressing his layman views and babbling nonsense, please forgive if it doesn't make sense. It is NOT financial advice, and NOT a recommendation to buy or sell any stocks or REITs. Pls do your own due diligence and/or consult a qualified financial advisor before making any moves or taking any actions. Pls note that past performance is not an indicator or guarantee of future performance or potential.
Comments