What will I buy with $3000 (Mar 2016)?

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Over the past one month, stocks have risen ~5%. If anyone made money out of it, it would have been pure luck. Nobody would have expected Saudi Arabia and the 70% of the oil suppliers to agree to freeze oil output. They could have done this 1.5 years ago, but they didn't.

In Singapore, manufacturing output decreased, which was not surprising as Singapore's labour costs had been growing the past 10 years and factories shift out. Office supply is adding pressure on rentals, which is also expected (we all knew this when these projects started construction 4 years ago), so the market has priced that in. If you look at how each industry contributes to Singapore's GDP, you will know why a manufacturing output drop is deemed to be a sign of a technical recession coming our way. Finance and business services (e.g. consulting) are growing.

Extracted from Statistics Singapore 

For me, as long as the population grows, businesses will always be in business, (of course) subjected to prudent financial management. The growth investor may want to invest in businesses that benefit from higher population densities. Trains breaking down more often doesn't count. Examples of such businesses are food, medical services, waste disposal, high-tech construction, logistics, etc.

I probably will recommend the first-time investor to buy on weakness, i.e. wait for the current wave to subside to a support level before making any purchases. Steer clear of bank and oil stocks if you can't survive a market shock.

1. SPH REIT* $0.95, 5.7% yield. If you buy 3,000 units, you can expect to get $150/year. Pros: Rental from Paragon and Clementi Mall are expected to be stable.

2. AIMS AMP Capital REIT $1.33, 8.5% yield. Pros: Diversed industrial properties (business parks, light industrial buildings, warehouses) on rental with continual asset enhancement activities (i.e. rebuilding/renovating old buildings). Buy 2,200 units, and expect to get $249/year.

Read the financial statements before putting your money on any stocks.

The above is by no means a fail-proof recommendation to buy. Stock prices fluctuate and buyers need to be aware of the risks.

The writer owns stocks marked *.