The STI is falling!

Let's go back in time to 2002...

And in 2008, the worst crash since the Great Depression in the 1930s..

And the most recent crash in 2011..

It seems a no brainer to buy at the points circled in red, as STI just keeps falling. You don't know when the bottom will be reached, just buy blindly. Of course some planning is required as to how much you buy each time. A good guide can be found here.

Seems easy? What about now? Do you dare to buy? Or do you tell yourself the stories that is happening around the world today, like China slowdown, falling oil prices, rising interest rates? What about the past crashes, do you still remember those stories?

You might also tell yourself that this time is different. Of course it is different! Else the market won't crash if it is the same old story (think Greek debt crisis).

But wait, there's more... dividends.

Year	STI ETF	Dividends	Dividend Yield based on 2003 purchase price	Dividend Yield based on 2009 purchase price	Dividend Yield based on 2011 purchase price
2003	$1.60	$0.061	3.8%	-	-
2009	$2.50	$0.090	5.6%	3.6%	-
2011	$2.70	$0.080	5.0%	3.2%	3.0%
2016	$2.70	$0.097	6.1%	3.9%	3.6%

If you have bought STI during the crash in 2003, your annual dividend yield has increased from 3.8% to 6.1% today, over the past 13 years. You would have got back about half your invested capital via dividends alone.

Finally, I must put out a disclaimer which is past performance is not indicative of future results. Investing is a game of probability, there is no certainty.

If certainty is what you crave for, you would have to settle for the returns of fixed deposits or Singapore Savings Bonds.