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Where and How do you Invest in HK?

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  1. #1

    Join Date
    Dec 2012
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    598

    Where and How do you Invest in HK?

    Hi guys,

    So now that I'm settled into HK, I have some savings in my bank account at HSBC that I want to use to do some investing with some returns (better than letting it sit there and gain pratically zero interest every month).

    Could any experienced folks tell me where and how you invest? Do you do it with your bank or with another financial provider?

    I'm just looking for some safe investments for the long run - mild returns are ok to me. Nothing too risky.

    Thanks in advance for your advice!


  2. #2

    Join Date
    Jan 2008
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    1,966

    Safe returns

    Only safe returns are buy HK Government Inflation index bonds. You can buy through your Bank or any HK Stock exchange Broker.
    See the announcement below:

    6 February 2014
    Tender for the re-opening of 3-year Government Bonds under the Institutional Bond Issuance Programme to be held on Friday, 7 March 2014


    Quote Originally Posted by 7jai:
    Hi guys,

    So now that I'm settled into HK, I have some savings in my bank account at HSBC that I want to use to do some investing with some returns (better than letting it sit there and gain pratically zero interest every month).

    Could any experienced folks tell me where and how you invest? Do you do it with your bank or with another financial provider?

    I'm just looking for some safe investments for the long run - mild returns are ok to me. Nothing too risky.

    Thanks in advance for your advice!

  3. #3

    Join Date
    Mar 2014
    Posts
    1

    Small question for Oldtimer, the interest rate on these bonds are only 0.34% or did I misunderstood something ? Is it really interesting to invest in this case ? (I never did anything with bond so please correct me).

    SalseroHK likes this.

  4. #4

    Join Date
    Jan 2008
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    Inflation

    Nominal interest is low. Depending on the inflation, at maturity you may get 3-4%

    Quote Originally Posted by lucifel:
    Small question for Oldtimer, the interest rate on these bonds are only 0.34% or did I misunderstood something ? Is it really interesting to invest in this case ? (I never did anything with bond so please correct me).

  5. #5

    Join Date
    Mar 2012
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    I think Oldtimer confused these bonds with the inflation-linked bonds that the government issues from time to time. Those give whatever inflation is deemed to be for the quota of $10k or $20K that you get in the IPO, but the same as any other government bond in the secondary market. Apart from the government handout which is the IPO of the inflation-linked bonds, the bond market is fairly low yield again now unless you wish to take some significant risk of default.

    To answer the original questions, I simply invest through my bank (HSBC). I am a buy and hold sort of guy, so I only trade a handful of times each year. That being so the convenience of managing my money through a single integrated online portal outweighs the fact that HSBC's brokerage charges are a bit higher than I could get by shopping around other brokers. The difference is only a couple of hundred dollars a year or so for my trading pattern.

    What to invest in is, of course, the key question. Personally I look for solid stocks in real businesses that I can understand, with a reasonable dividend yield. My biggest holding is Power Assets, which gives me about 6% on what I paid for it (though it is also up about 50% since I bought, and the dividend yield if you bought now would be about 4%). I also have a chunk of HSBC, though for less volatility you might look at Hang Seng Bank, which yields about 4.4% currently. You might also consider simply investing in the Hang Seng Index overall via the Tracker Fund (which pays dividends as if you owned the underlying mix of stocks), but for me that is now more heavily a mainland play than I would like.

    SalseroHK likes this.

  6. #6

    Join Date
    Jan 2008
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    inflation linked bonds

    "I think Oldtimer confused these bonds with the inflation-linked bonds that the government issues from time to time. "
    Sorry my mistake.


  7. #7

    [QUOTE=Gruntfuttock;2755370].....I also have a chunk of HSBC...QUOTE]


    wow...sorry!!


  8. #8

    Join Date
    Feb 2014
    Posts
    6

    Depending on whether you like to invest passively or actively. If you want to invest passively through stocks, HSBC is an option. For active management on a portion of you savings, you might want to consider i-access and bright smart these local brokerages that offer low commission fees. However as Gruntfuttock has mentioned you should know the stocks you buy very well otherwise the consequences can be unappealing. Depending on your savings level and your risk appetite you can also consider bonds and funds.


  9. #9

    Join Date
    Oct 2005
    Location
    HK Island
    Posts
    194

    Avoid individual stocks, buy low-cost index funds/ETFs. Ideally from Vanguard (you have to buy in the US but worth the trouble). HK listed stuff still not as good as US (I am not an American so think I am quite objective).

    You can adjust your risk by adjusting your asset allocation between risky and less risky assets (not as complicated as it sounds).

    Buy this book, best investment I've ever made:
    The Only Guide to a Winning Investment Strategy You'll Ever Need: The Way Smart Money Preserves Wealth Today
    http://www.amazon.com/Guide-Winning-.../dp/B003K15OJI


  10. #10

    Join Date
    Oct 2005
    Location
    HK Island
    Posts
    194

    Also check out this old thread:
    http://hongkong.geoexpat.com/forum/1...d147271-5.html

    Look for the post that starts with 'The Couch Potato Portfolio', great stuff if you don't want to buy the book.


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