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The Weekly Nibble: What’s Next After the US Interest Rate Hike?

Here are some of the most interesting articles that have appeared in the Motley Fool Singapore’s website over the past week. Let’s dive straight in!

1. The US Federal Reserve Is Almost “100% Certain” To Raise Rates: Here Is Warren Buffett’s Advice on How Investors Should React

On Thursday, the Federal Reserve, the US’s central bank, said that it will raise interest rates by 0.25 percentage points to between 0.75% and 1%. My Foolish colleague, Chin Hui Leong, explored a piece of advice Warren Buffett gave in 2015 on what investors should do, when interest rates are changed.

Summary: Changes in interest rates would not have a bearing on how Buffett invests.

Here’s an extract from the article:

“When asked about interest rates, Buffett responded: “If (Federal Reserve Chair) Janet Yellen came up and whispered in my ear what she was going to do for the next two years, it wouldn’t make any difference what we do.”

So, Buffet was pretty clear on what he would do about changes in interest rates – he wouldn’t change a thing about the way he invests even if he knew exactly what the Federal Reserve would do. For Buffett, his eyes are focused on finding the right companies, with the right people, at a sensible price.”

2. What Makes A Solid Income Share?

Income shares dish out large dividends to its investors. To decide if an income share is worth investing in, we have to focus on the company’s financial robustness, business model, and the level of maturity of the business.

You can have a more in-depth look at how to choose an income share by hitting the link given above.

3. Singapore REITs, the Straits Times Indexand the FTSE Small Cap Index

Just like income shares, real estate investment trusts (REITs) are also a favourite of Singaporean investors due to the frequent income distributions that REITs pay out. Here are nine key numbers you should know about Singapore’s REITs.

The Straits Times Index (SGX: ^STI) is made up of 30 of some of the Singapore market’s largest companies and it is used as a benchmark for the local stock market. To know five fascinating things about the Straits Times Index, jump in here.

Although some investors prefer to invest in large companies, small stocks should not be neglected too. That’s because small cap stocks could provide greater growth potential than more mature blue-chip stocks. You can find out the top five most influential companies in the FTSE Small Cap Index right here.

For more (free!) investing tips, sign up here for your FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock Singapore. It will teach you how you can grow your wealth in the years ahead.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.