Is Dollar Averaging the Magic Pill and Does it suits Everyone? Part Two of Three!

Part 2. POSB Invest Saver vs OCBC BCIP (Both work with Dollar Averaging)

Dollar Averaging in a nutshell,

1. When price action is lower, your $100 investment can buy more units.

.2. When price action is higher, your $100 investment buy less units.

On total average when low is more then high, your units' price is in average (possible) low.

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There are a few shared post below to read up on Both Dollar Averaging Plan so I will go straight to the main points to compare.

1. POSB Invest Saver

(i) Pay a low sales charge of 1% (charged on each monthly transaction) from as low as S$1 based on the minimum investment of S$100 a month. There are no other administration or platform charges involved.

(ii) No exit or redemption charges. However, please note that this may be "subject to change." ("clause" is important for any documents)

(iii) On Purchase, as only round figures can be issued for the POSB Invest-Saver, the cost and sales charge of the residual units of 0.82 units will be refunded back to you.

(iv) Only purchase Nikko AM Singapore STI ETF

For more info:

http://www.posb.com.sg/personal/investments/invest-saver/faq-important-notice/default.page

http://singaporeanstocksinvestor.blogspot.sg/2013/07/tea-with-matthew-seah-posb-invest-saver.html

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2. OCBC BCIP

(i) For Fees Rate and Promotion refer to the link below

http://www.ocbc.com.sg/personal-banking/Investments/bluechip.html#fees

(ii) Exit or Transfer Charges. Refer to the same link

http://www.ocbc.com.sg/personal-banking/Investments/bluechip.html#fees

(iii) On Purchase, the quantity will be rounded to the nearest whole number. If rounded up, there will be no additional charges. "If rounded down, we will not credit any residual monies to you." (This is very important)

(iv) Can Purchase into either 18 share counters and one Exchange Traded Fund (ETF).

For more info:

http://www.ocbc.com.sg/personal-banking/Investments/bcip-faqs.pdf

http://singaporeanstocksinvestor.blogspot.sg/2013/07/tea-with-matthew-seah-ocbc-blue-chip.html

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What we should take note in this article is,

POSB point 1 (iii)
OCBC point 2 (iii)

The objective of this Dollar Averaging Saving Plan is to make value out of money, but by incurring expenses that are not necessary just defeated the purposes.

Which plan would you recommend after reading this post?

Don't Buy into anything yet. Read Part 3.

In Part 3, I will explain, is Dollar Averaging the Magic Pill and whether it suits everyone.

Another Good Deed Done!