Many of my close friends and family invest mainly in Singapore shares. For their property portfolios, they swear mostly by Singapore properties too. At most, their property diversification crosses over to Iskandar.
My advice is that for stocks, you should have half of your portfolio in developed markets like the US, Europe or Japan. The other half should be in emerging markets like China, Russia and India.
Similarly for properties, you should not have everything in Asia. The diversification benefits is poor because the economic cycle is the same in Asia. If Malaysia is in a recession, Singapore is likely to be in a mess too. But in the US and EU, things may be honky dory. Right now, ASEAN is right at the peak, but US and EU is just beginning to rise.
http://www.guardian.co.uk/money/2013/jun/28/new-class-landlords-profiting-generation-rent
Above is a hyperlink on the generations of buy-to-let investors. Fergus and Judith Wilson apparently fell into hard times because their 700+ property portfolio was highly leveraged and several banks tried to recall the loans. Once rentals fall, the couple's cashflow turned negative dangerously.
To weather the storm, you need to keep your property and stock portfolios diversified. Fergus and Judith focused on Ashford and Maidstone. When the credit bubble burst, tenants defaulted. My question to my friends and readers is this: what will happen when interest rates rise in Singapore? Will your portfolio turn negative in cashflow too?
If you have a three to four properties in Singapore, another two to three in Iskandar, two in Australia, four in the UK and another five in the US, even if Asia falls into hard times, you will not lose everything. You have the option even to close shop in Singapore and move overseas to start all over again.
Stocks Looking Extremely Cheap
By the way, the correction that I signalled on 6 June appears to be extremely deep. It turns out that bonds and bond funds have been badly hit. I believe we should see a bottom very soon. Valuations for equities are looking extremely cheap.
