I believe a good investment portfolio should have a balance between growth opportunities and stability. While I remain interested in US technology and semiconductor stocks for their long-term growth potential, I also want exposure to Singapore's established businesses. This is why I invest in the SPDR Straits Times Index ETF (ES3). Rather than chasing high returns all the time, I see ES3 as a way to build a more balanced portfolio and participate in Singapore's economic growth.
One thing I like about ES3 is its exposure to the Straits Times Index (STI), which tracks 30 of the largest and most established companies listed in Singapore. Its composition includes major banks such as DBS, OCBC and UOB, alongside companies from sectors such as telecommunications, industrials, property and consumer businesses. This gives me exposure to different parts of the Singapore economy through a single investment, without having to research and select every individual stock.
Diversification is another important reason behind my decision. Instead of putting all my capital into one company or sector, ES3 spreads my exposure across multiple established businesses. The banking sector has a meaningful weighting, but the ETF also provides exposure to other industries. It helps reduce company-specific risk and complements my heavier exposure to US technology and AI-related investments. Of course, diversification does not eliminate market risk, and the STI can still experience significant declines during difficult economic periods.
My approach is to accumulate ES3 gradually and hold it for the longer term. I am not expecting it to deliver the same growth as high-momentum technology stocks, but I value its role in providing geographical and sector diversification, as well as potential dividend income. For me, investing is not just about finding the next big winner. It is also about building a portfolio that can remain resilient through different market cycles. Growth is important, but having a solid foundation matters too.
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