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| Market Trends In Singapore: Investment Planning |
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| Surveys in the US over the past ten years have consistently found women to be less confident about investing than men. Most women simply left their money in their fixed deposits. When they did invest, women were found to take a more cautious approach and tended to take a longer term view. |
| Finding Of The Survey Reveal That: |
| 1. Men invested significantly more heavily than women in stocks and shares. 2. There appeared no significant difference in all other areas of investment i.e. fixed deposits, unit trusts, investment linked insurance policies and property. 3. Among the 12.5% of the respondents who do not currently invest, more than half the women respondents cited their lack of knowledge on how to plan a portfolio, as a reason. Other reasons given were �too insecure about taking a risk� and �lacked knowledge about different types of investments�. The latter reason was also the main reason given by male respondents for not investing. 4. Different investment objectives between men and women: A greater percentage of women respondents wanted to see some gains within a year (47%) and within weeks (23%), compared to men (40% and 20% respectively). More women invest for retirement (19%) as compared to men (9%). 5. Different attitudes towards life and risk-taking - Women tended to be generally more cautious than men. - Women were significantly more concerned about keeping their capital secure rather than pursing higher returns compared to men. - Women are more willing to check out all the alternatives before making an investment decision. - Men are less likely to consult their spouses on their investment decisions. - 67% of the male respondents were the main financial decision maker in the household and only 16% said that these decisions were taken jointly. - On the other hand, only a quarter of the women claimed to be the main financial decision maker, with 40% saying they were not the main decision maker and 33% claims joint responsibility. |
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| Implications Of The Survey Results For Financial Planners |
| Women are more cautious as investors and may take unit trusts as lower risk investment tools more readily then men. It also appears that many women are under-invested and therefore flushed with cash, having held steady jobs but preferring to simply leave their money in the bank. Financial Planners should advise their female clients that by keeping money in the bank is not a solution to their investment needs because the yield is low. Recognising the fact that women may not respond to a pure investment product, a financial planner may chose to recommend a lifestyle product i.e. investment-linked product. Thus financial product is not sold as being a financial product but sold on the basis of a concept or the benefits it provides. Ultimately, these policies are all the same thing i.e. they invest in unit trusts, but have different names attached to it. In addition, they also provide life protection, which differentiates from the unit trusts, that banks are offering. People buy these concepts more readily. Financial planners may want to get the message across their female clients that unit trusts are for saving and accumulation purposes rather than for speculation. |
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| An indexing study is made by MSU-CIBER to compare the emerging markets in 23 countries on several dimensions. Seven dimensions are chosen to represent the market potential of a country over a scale of 1 to 100, and they are given weights to contribute to the overall market potential index. The dimensions and measures of the market potential includes GDP real growth to measure each country�s market growth rate, as well as the population to measure the market size. Results showed that Singapore was ranked the top ten, in terms of market growth, market intensity and commercial infrastructure. She topped the chart in terms of market receptivity and country risk. This meant the risk that something may happen Singapore, which will negatively influence the willingness or ability of state, owned and/or privately owned customers on Singapore to pay their debts on time is very low. In all, Singapore was ranked the highest market potential market among the 23 countries. Singapore emerge as a very attractive market for foreign investors to invest in. |
| Market Potential Indicators For Emerging Markets |
| Market Market Market Market Commercial Economic Market Country Overall Market Size Growth Intensity Consumption Infrastructure Freedom Receptivity Risk Potential Index Rate Capacity Countries Rank Index Rank Index Rank Index Rank Index Rank Index Rank Index Rank Index Rank Index Rank Index SINGAPORE 23 1 2 78 8 65 - - 2 91 13 72 1 100 1 100 1 100 S. KOREA 6 15 1 100 10 59 2 97 7 55 6 89 8 15 6 55 2 77 HONGKONG 21 2 11 42 2 93 - - 3 80 5 91 2 58 4 76 3 77 PORTUGAL 19 2 7 46 4 80 7 79 5 70 1 100 11 9 2 87 4 65 CHINA 1 100 5 61 23 1 8 71 20 7 23 1 18 4 12 43 5 63 GREECE 18 2 12 42 1 100 3 92 6 68 10 77 19 4 3 78 6 62 CZECH REP. 16 3 20 21 19 40 1 100 1 100 2 97 7 17 10 49 7 55 ISRAEL 22 2 9 43 17 43 6 85 4 70 11 76 5 20 5 67 8 52 POLAND 10 8 13 41 5 77 4 88 10 39 9 82 13 7 9 50 9 49 HUNGARY 20 2 16 34 16 45 4 88 8 54 7 87 6 18 8 53 10 46 INDIA 2 55 6 54 18 43 11 63 23 1 18 41 22 1 17 31 11 44 THAILAND 13 6 3 74 21 27 12 60 21 7 8 85 9 15 14 42 12 35 ARGENTINA 11 7 19 27 3 87 - - 11 25 4 95 21 3 16 33 13 34 MEXICO 5 17 17 34 7 66 17 28 17 15 14 65 4 21 13 42 14 30 MALAYSIA 15 4 4 70 22 9 16 44 14 20 20 34 3 39 11 45 15 27 CHILE 17 3 10 43 9 64 18 16 15 19 3 96 16 6 7 54 16 25 PHILIPPINES 12 6 8 44 13 47 14 47 16 17 15 62 10 14 18 29 17 22 BRAZIL 4 33 15 34 14 47 19 7 12 22 16 51 23 1 20 26 18 19 RUSSIA 3 47 22 7 20 30 15 45 9 39 22 15 20 3 23 1 19 17 TURKEY 9 10 21 16 11 55 10 66 13 22 17 42 17 5 19 29 20 16 INDONESIA 7 13 14 36 15 46 9 69 22 1 19 37 12 9 22 2 21 13 S. AFRICA 8 10 18 28 12 52 20 1 19 12 12 74 15 6 15 39 22 10 VENEZUELA 14 5 23 1 6 74 13 51 18 12 21 25 14 6 21 12 23 1 |
| DIMENSIONS AND MEASURES OF MARKET POTENTIAL Dimension Weight Measures Used Market Size 10/50 Urban population (million) -2000 Electricity consumption (billion kwh) - 1999 Market Growth Rate 6/50 Average annual growth rate of commercial energy use (%) - between years 1990-1997 GDP real growth rate (%) - 1999 Market Intensity 7/50 GNP per capita estimates using PPP (US Dollars) - 1999 Private consumption as a percentage of GDP (%) - 1999 Market Consumption Capacity 5/50 Percentage share of middle-class in consumption/income (latest year available) Commercial Infrastructure 7/50 Telephone mainlines (per 100 habitants) - 1999 Cellular mobile subscribers (per 100 habitants) - 1999 Number of PC's (per 100 habitants) - 1999 Paved road density (km per million people) - 2000 Internet hosts (per million people) - 2000 Population per retail outlet - (latest year available) Television sets (per 1000 persons) - 1998 Economic Freedom 5/50 Economic Freedom Index-2001 Survey of Political Freedom - 2000-2001 Market Receptivity 6/50 Per capita imports from US (US Dollars)-1999 Trade as a percentage of GDP (%) - 1999 Country Risk 4/50 Country risk rating - 2000 |