More than 90 per cent of unit trusts and investment-linked insurance products (ILPs) in the CPF Investment Scheme (CPFIS) saw positive absolute returns for the three months to December, according to the latest report by Standard & Poor's (S&P) Fund Services."
- Stock advance lifts CPF savings products , 27 Feb 2007, Business Times Singapore
It is heartening to read such news in the papers even though I do not invest my CPF monies via the CPFIS after I was not able to better the interest rates offered.
Many people will be motivated by such news to actively look for investment products to beef up their retirement funds but past performance is not indicative of future performance and more likely than not, the easy money had already been made after the stock market run-up in recent months.
Recency of data will also affect our judgement and it should still not be difficult to look back a little more and realise that until recently, many people's investments via the CPFIS had not performed satisfactorily.
A rising tide lifts all boats and it is no big wonder that CPF savings products had turned in a good report card for the last quarter. However, there is a need to look beyond whatever euphoria there is and appreciate that market risks today are higher and potential gains in the well performing markets may not last for much long.
Calculated risks and diversification is key to ensuring we get good returns on our monies and eventually enjoy a comfortable retirement.
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