17 Things You Have To Know About Singapore’s Stock Market

Last May, a thought had popped into my head: I wanted to collect important historical facts and figures about Singapore’s stock market and present them in a single article.

Some of you may wonder if there’s any value in doing so. In response, I’d quote my colleague Morgan Housel. He once wrote: “So much of doing well in the stock market comes down to knowing what to expect.” It is knowledge of stock market history that helps us know what to expect.

My aforementioned thought eventually became an article I published on 29 May 2015 that’s titled 6 Things You Have To Know About Singapore’s Stock Market. I had written in the article that it is “a work in progress, something which I’d update whenever I come across new information.”

Over the past 10-plus months since the article’s publication, I’ve managed to come across many new facts to bring the total fact count to 16. You can see them all below:

I have recently discovered something really interesting about the local stock market. Here’s the 17th piece of information:

17. Blue chip stocks can be very poor long-term investments too.

The current version of Singapore’s stock market barometer, the Straits Times Index (SGX: ^STI), was launched on 10 January 2008 after a revamp. You can find a list of the original 30 stocks that made up the revamped index here.

What’s interesting to me is how badly some of those blue chip stocks have performed since 10 January 2008. Some of the poor performers include big local companies such as CapitaLand Limited (SGX: C31), Sembcorp Marine Ltd (SGX: S51), and City Developments Limited (SGX: C09). From 10 January 2008 to today, the trio have seen their shares decline by 30%, 48%, and 34%, respectively. Those returns include the gains from reinvested dividends.

The table below shows how the complete list of the initial 30 stocks have performed over the past eight-plus years (Sidenote: Returns from Keppel Land are not included because it is no longer around in the stock market):

Blue chips table
Source: S&P Global Market Intelligence

As you can see, there are a total of 14 stocks in that initial list of blue chips that have negative total returns in the timeframe under study.

The term “blue chips” often carry a positive connotation in Singapore’s stock market. Blue chips are commonly seen as stocks that have established and stable businesses. But, given the table above, it could be dangerous to assume that a stock will be a good long-term investment just because it’s a blue chip stock.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore writer Chong Ser Jing doesn't own shares in any companies mentioned.