WRONG! WRONG! WRONG!
How can stock indices like STI and DJIA be allowed to track only "selective companies" while property indices have to track ALL properties "across the island"?
This allows some people here to claim that stocks outperform properties over the long term, which is
NONSENSE.
That's like saying Nigerians are wealthier than Singaporeans because the top 30 Nigerians have an average networth greater than the average of ALL Singaporeans.
I have compiled
JLRX's Singapre PROPERTISM Index (
JSPI).
The
JSPI index tracks 30 "selected" properties (same as the number of stocks in STI).
METHODOLOGY OF JLRX PROPERTISM INDEX (JSPI)
Same methology as stock indices throughout the world.
Includes only 30 "selective" properties.
Example 1: Farrer Court transacted $380,000 on 21 Jan 2002 and en bloced at $2.4 million on 28 Jun 2007 (up 532%).
Example 2: Margate Road detached houses transacted $306 psf on 12 July 2001 and $1,815 psf on 12 Nov 2007 (up 493%).
The average return of JSPI "selective" properties is
as representative of all properties in Singapore as STI is of Singapore's stock market. The average return of properties was 500% over the past 10 years.
JLRX is pleased to superimpose JLRX Singapore PROPERTISM Index (JSPI) onto the URA property index, NUS's Singapore Residential Price Index (SRPI) and the Straits Times Index (STI).
It clearly shows that Singapore properties have appreciated by 500% over the last ten years, compared to a miserable 46% for the Straits Times Index (STI) and (not shown to avoid contaminating the graph) the DJIA which has appreciated 0% over the last 10 years.