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How I Filter SGX Stocks for My Personal Watchlist

Living in Australia gives me a strange advantage when I look at the Singapore Exchange. The eight-hour time difference between Sydney and Singapore means I can scan overnight SGX announcements with fresh eyes each morning over a flat white, before my own trading day on the ASX even begins. I started picking Singapore-listed counters years ago because my wife is from Bukit Merah and we still have family property there, but what kept me interested was how disciplined the disclosure regime is. Every quarter, the same companies file the same template, and after a while you start to notice the patterns.

A watchlist, the way I use it, is not the same thing as a buy list. It is a staging area. Stocks sit there while I gather more information, watch the price action, and wait for either a better entry point or a reason to walk away. Treat it like a shopping shortlist rather than a commitment. Once a name sits on the list for two or three cycles without doing anything, I usually delete it and move on. Cluttered watchlists are worse than empty ones.

My approach is closer to personal accounting than active trading. I treat SGX picks the same way I treat my household budget on this site, recording the entry yield, the price I first noticed it at, and the date. That habit came from years of watching friends in Melbourne pile into penny stocks because someone on a Telegram group said so. Filtering with written rules has saved me from at least a few headaches.

What follows is the actual sequence I run whenever I hear about a new ticker or read about an upcoming IPO. None of this is professional advice. It is simply the workflow I follow so my watchlist does not turn into a graveyard of forgotten positions, and so the few names that survive the filters are the ones I am most likely to act on later.

Screening Criteria: Where I Begin

Before I look at a chart, I start with a flat list of basic thresholds. Market capitalisation has to be above a certain level because illiquid small caps on the SGX can move twenty percent on a single trade and I want to avoid those surprises. I also require at least a few years of listed history, ideally across one full economic cycle, so I can see how the company behaves in both good and bad years. Anything that IPO'd in the last twelve months gets filed in a separate folder for later review.

I run an initial pass using freely available screeners and the SGX website itself, then I cross-reference with brokerage research notes. The point is not to copy any analyst's price target. It is to find out who is covering the stock and what their assumptions look like. If nobody is covering it, that is information too. A name with no analyst coverage might be undiscovered, or it might be unfollowable, and I usually assume the latter until I see evidence otherwise.

Price is also a screening step, oddly enough. Anything below S$0.20 tends to be structurally messy, often with capital raises looming, and I learned that the hard way chasing a couple of small-cap recovery stories a few years back. The reverse trap is the S$50-plus counters, which can be perfectly fine businesses but rarely offer the margin of safety I want for an initial watchlist entry. Most of what I track sits in the S$1 to S$10 range, where there is still depth in the order book without the boutique-name risks of the smaller caps.

Dividend Yield and Payout History

Yield is the single number that catches my eye first, but it is the payout history that decides whether I keep looking. A stock can advertise an eight percent yield for one quarter and then cut it the next, leaving existing shareholders holding the bag. I want to see at least five years of either stable or rising distributions, with the occasional special dividend treated as a bonus rather than baked into the calculation.

There is a useful parallel with how I think about my own cash flow, and I wrote about a related decision around my CPF investment scheme fund choice in a separate review. The same principle applies. I would rather earn a reliable four to five percent from a steady Singapore blue chip than chase a juicy headline yield that disappears after one cycle. Boring dividends compounded over a decade beat exciting ones that vanish in two.

I also pay attention to the payout ratio. If a company is distributing more than seventy or eighty percent of its earnings, the dividend is probably at risk the moment revenue dips. The healthier names keep their payout ratios in the fifties with room to grow, and they tend to lift the distribution by small amounts every year rather than promising big jumps that never come. On my screen, consistency matters far more than the absolute level of the yield.

Fundamentals Beyond the Headlines

Once a stock passes the dividend filter, I dig into the actual numbers. Return on equity tells me whether management is producing something useful with the capital shareholders have given them. Debt to equity tells me how exposed the business is when rates rise, which has been a recurring concern in Singapore's banking-heavy index. Free cash flow conversion tells me whether reported earnings actually turn into money in the bank, and far too many SGX names look great on the income statement and weak on the cash flow statement.

I keep a small spreadsheet with each candidate's three-year averages for those metrics, so I am not fooled by a single good year. If return on equity averages under eight percent over the cycle, the stock usually does not make it onto the watchlist no matter how cheap it looks on a P/E basis. Cheap is only useful if the underlying business is producing returns. Otherwise you are catching a falling knife, which I learned the hard way with a regional bank that shall remain nameless.

I also read the annual report cover to cover, or at least the chairman's letter, the segment breakdown, and the risk factors. Companies that bury bad news in page ninety-three of a hundred-page document tend to keep doing it, while those who explain a bad quarter clearly and openly usually handle the next one better too. That habit of reading the small print is similar to how I scrutinise my monthly spending categories - the boring line items are where the truth lives.

Sector and Geographic Diversification

I never want my watchlist to be dominated by one sector. The Straits Times Index is famously heavy in banks, REITs, and industrial conglomerates, so if I am not careful I end up with three banks and two REITs and nothing else. I cap any single sector at three names, and I prefer to track at least one consumer, one industrial, and one healthcare or technology name alongside the financial and property holdings. That mix keeps me from being blindsided when one sector hits a regulatory or cyclical wall.

Geographic exposure matters too. A surprising number of SGX-listed companies earn most of their revenue from China, Indonesia, or Australia itself, and that mix shifts quarter to quarter. I keep a note of where the top line actually comes from, because a Singapore-listed company with eighty percent of its business in Greater China behaves very differently from one that earns locally. I think about it the same way I think about my Australian holdings - if half my ASX positions are BHP and the banks, I have effectively taken a giant bet on commodity prices and the local housing cycle without realising it.

Currency adds another layer. Earnings are reported in Singapore dollars, but if I am sitting in Brisbane converting back to Australian dollars, the SGD/AUD cross can quietly eat a chunk of my return. I do not hedge this, because it would overcomplicate things, but I do check the trend over a six-month window before adding anything new. A weakening Singapore dollar against the Aussie is a hidden headwind that does not show up on the price chart.

Final Filters and Triggers That Push a Stock Onto the Watchlist

The last step is a personal set of triggers that decide whether the name actually goes on the list or gets discarded. One trigger is insider buying. When directors and substantial shareholders open their own wallets at current prices, that tells me something the news flow cannot. The opposite, insider selling around results, gets a quiet note in the spreadsheet even if I do not delete the name outright.

Another trigger is the catalyst. Every name on my watchlist needs at least one identifiable event in the next six to twelve months that could re-rate the stock. That might be a new contract win, a divestment, a rate decision, an acquisition closing, or simply the next earnings print after a soft quarter. Stocks without a near-term catalyst tend to drift, and drifted names waste my attention. If I cannot point to a specific date or event, I usually remove them at the next review.

Finally, I run a quick gut check. I imagine owning the business outright, with no exit price in mind, and ask whether I would still want to be a long-term shareholder. If the answer is no, the stock does not belong on the watchlist at all, because the watchlist is supposed to be a shortlist of names I am willing to actually buy. That filter is the harshest of the lot and removes more candidates than any of the spreadsheets do.

Filters I Run Before Adding Anything

A watchlist is only useful if it actually drives decisions later on, and mine is no exception. Every quarter I open the list, remove anything that has lost its reason for being there, and consider whether the survivors deserve a real allocation. If you are tracking SGX counters from outside Singapore, whether you are based in Perth or Parramatta, the discipline of writing down your rules matters more than any single screen you run.

If you want to see how I document the rest of my household finances alongside these stock notes, the lifestyle reviews section on this site pulls together the odd spending experiments and seasonal price tracking I do, from durian season to weekly grocery benchmarks. It is the same habit applied to a different ledger, and it keeps me honest when the SGX gets exciting.