Regular Savings Plan (RSP)

regular savings plan

Unit Trust Regular Savings Plan can help you on your investment journey.

Asia is set to become the biggest driver of world growth, outstripping even the world’s developed economies for the first time. Here in Asia, we are well-placed to capitalise on some of the best investment opportunities the markets have to offer.

If you are keen to participate in the growth potential from stock markets, you can achieve this by investing in unit trusts which provide a diversified portfolio and by practising regular investing through dollar-cost averaging. Remember what’s important is “time in the market, not timing the market”. Unit Trust Regular Savings Plan(RSP) will help you become a disciplined investor to reap the eventual benefits of the markets’ long-run secular uptrend.

How does RSP work?

  • With a RSP you make fixed monthly investments, regardless of market conditions
  • You avoid the uncertainties of market timing, by not speculating on the “right” time to invest your capital as a lump sum
  • By investing a regular sum each time, you have the benefit of “dollar cost averaging” through buying fewer investment units when prices rise but more units when prices fall
  • Over time, your average unit cost is lower than the average market price of the security during the same period of time

This table illustrates the number of investment units an investor buys every month if he invests S$500 into the market via Unit Trust Regular Savings Plan.

Month Monthly Investment Amount Unit Price Unit Purchase Each Month
January S$ 500 S$ 9.00 55.6
Febuary S$ 500 S$ 10.00 50.0
March S$ 500 S$ 8.00 62.5
April S$ 500 S$ 11.75 42.6
May S$ 500 S$ 12.25 40.8
June S$ 500 S$ 9.00 55.6
Total S$ 3,000 S$ 60.00 307.1

Figures are for illustrative purposes only.

Average Unit Price: S$10.00 (S$3,000/6 purchases)
Average Unit Cost: S$9.77 (S$3,000/307.1) units

As seen in the table, if an investor invests regularly into the market, he pays S$9.77 per unit, which is lower than the market average price of S$10 per unit over the same period of time!

Enjoy a 0% sales charge* on RSP until 31 Dec 2013

In addition, when you participate in a RSP at POSB, you will enjoy a 0% sales charge on your cash investments up to $500 per month from now until 31 Dec 2013.

For more information, please visit any of our POSB branches. Our Personal Financial Managers will be happy to assist you.

* Terms and conditions apply

Important Notice
This is for information and general circulation only and does not have any regard to the specific investment objectives, financial situation and the particular needs of any specific person. Investors should seek advice from a financial adviser regarding the suitability of the investment product, taking into account the specific investment objective, financial situation or particular needs of each person before making a commitment to purchase the investment product. In the event an investor chooses not to do so, he should consider carefully whether the investment product is suitable for him. The opinions expressed are subject to change without prior notice. DBS accepts no liability for any loss whatsoever arising from any use of or reliance on the opnions expressed.