To The Moon

I decided to sell part of my SPDR Straits Times Index ETF (ES3) holdings. This does not mean I have lost confidence in Singapore's long-term market outlook. Rather, I believe it is important to manage risk when market conditions become increasingly unpredictable. After a strong rally earlier this year, the STI has experienced a meaningful pullback, while global markets are facing pressure from technology sell-offs, inflation concerns, rising bond yields and geopolitical uncertainty.

Another reason is that even though ES3 provides exposure to 30 established Singapore-listed companies, its portfolio is relatively concentrated in the banking sector. DBS, OCBC and UOB together account for close to 59% of its holdings. This means that weakness in the three major banks can have a significant impact on the ETF. Recent market movements have reminded me that even blue-chip investments are not immune to volatility, and diversification does not eliminate market risk.

My decision to sell partially is mainly about protecting the gains I have accumulated and reducing overall portfolio exposure. I would rather secure some profits now than become overly exposed during an uncertain period. The proceeds also give me additional cash flexibility to take advantage of better opportunities if the market experiences another correction. I do not intend to predict the exact market bottom or sell everything out of fear. Instead, I prefer to adjust my position gradually according to market conditions.

I still believe ES3 has a place in my long-term portfolio because it provides exposure to established Singapore businesses and potential dividend income. I am simply choosing to take a more defensive approach for now. My investment philosophy has always been about balancing opportunity with discipline. Sometimes, the best decision is not to buy more or sell everything, but to reduce exposure, preserve capital and wait patiently for a better risk-reward opportunity. Staying invested is important, but knowing when to take some risk off the table is equally important.

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