Seeking advice for newbie investor planning to invest in global ETFs

[brendanawitz]

Hello! New to the sub here.

After going thru a lot of PF content from US and SG recently, nice to find a community here covering this topic catered to Malaysia environment.

Bit of background on myself, 33 y/o but I've basically squandered my income for the past 9 years of working experience due to lifestyle creep and bad financial decisions. Luckily I decided to make a change last year and now have no high-interest debts, 6-month emergency fund and have been DCA-ing into robo advisor (total about 40k value). I'm also able to set aside 3-4k every month for investing.

Lately I've been planning to enter ETFs domiciled in Ireland due to lower dividend withholding tax from US. Have seen the setup required - SG bank account and global brokerage like IBKR.

My concern is more about bringing the money back to Malaysia. Assuming 10-20 years down the road, I've a substantial amount and decide to bring it back, will there be any risk of LHDN or other relevant authorities questioning where I got the large sum from? If it's a valid risk, then it'll be hard to buy any big ticket items with it like property.

Any advice or reassurance on this would be greatly appreciated.

 

[skleu5]

@brendanawitz For how to withdraw from IBKR, check Ziet Invest YouTube
He has extension guide on how to set up and use IBKR for Malaysian as well.

Tax wise I am not completely sure, but from what I know as long as it's legitimate source of income and you keep a track record of proof you should be fine.

 

[ladyghosthunter]

@brendanawitz No capital Tax gain here in Malaysia

 

[hazelhope]

@brendanawitz

My concern is more about bringing the money back to Malaysia. Assuming 10-20 years down the road, I've a substantial amount and decide to bring it back, will there be any risk of LHDN or other relevant authorities questioning where I got the large sum from? If it's a valid risk, then it'll be hard to buy any big ticket items with it like property.

As long as it's money that you paid taxes on (if applicable), then you're fine. Just furnish them with proof.

As for investment strategy, here's my opinion depending on your net worth.

1. RM500k: By now, you qualify for Portfolio Margin. This is the gateway to earning even more. You can now sell more naked options and have more buffer.

 

[holyrood]

@hazelhope Welcome to r/wallstreetbets

 

[hazelhope]

@holyrood It's a pretty conservative strategy (covered strangles).

Much safer than selling puts on meme stocks. Of course, you won't be earning a lot but it's around 8% p.a. extra on top of your ETF gains or even if the market moves sideways.

8% p.a. is a huge difference especially if your portfolio is huge. A RM1mil account means you have additional RM80k p.a. to spend.

 

[harmony21]

@brendanawitz If you're feeling risky, try etoro, it's quite popular.

Find a person or copy people that you think you can trust with your money, see their portfolio how they handle during all the years, having much experience, and how much/the maximum amount of drawdown they have on their portfolio, any drawdown higher than 50% is bad so find someone that per year that have drawdown about less than 50%.

Don't put all your money on one person, find like 4-5 more person to spread your money there/copy portfolio.

Some people invest in stock, commodity, resources.... In etoro you invest in people portfolio, then just copy them.

It's risky, but that is investing, all have risk, local bursa or stock have so little drawdown like 5%, in etoro, you may risk like 50%, if you manage find good person to copy with low drawdown, you can also gain like 50% like i said, it's risky because it has huge drawdown and also huge profit.

It's not trading, it's more investing on a person record or portfolio throughout the years and see their experience with it

You may see ex bank worker, tech , accountant doing copy portfolio there so you can copy their experience and knowledge on their stock.

But depends on you what you like

 

[revivalusa238]

@harmony21 I tried once with eToro and noticed they use mule account for money transfer. It is illegal in Malaysia to do so and in violation with AMLA. There are better brokers in the market.

 

[setst777]

@brendanawitz Open IBKR,

Invest in VWRA for Total World Stock Index

 

[solo81]

@brendanawitz

My concern is more about bringing the money back to Malaysia. Assuming 10-20 years down the road, I've a substantial amount and decide to bring it back, will there be any risk of LHDN or other relevant authorities questioning where I got the large sum from?

It is unlikely and foolish to repatriate a future two-comma account balance from IBKR into their Malaysia bank account. You are very much better off withdrawing what you need on an annual basis and leaving your money with IBKR that has FINRA and SEC regulation, has SIPC coverage, and has the rule of law and private property rights of the U.S. Considering the current situation in the country, the entitlement attitudes, and the expansion of the welfare state, why let your assets be exposed to an inevitable future cash grab by the government?

However, you have to be very careful not to leave a cash balance in the actual account and ensure your investments are in non-US domiciled investments because you will be liable to the U.S. estate tax. Preferably, you would invest into Ireland-domiciled ETFs to take advantage of favorable tax treatment of dividend income. None of this is a concern if you're investing through an LLC or a trust, though.

A Singapore-based broker would work just as well with more convenience, but the trading fees are very high.