STI correction: putting the selloff in perspective

If your investing app has looked a lot redder lately, there's a number behind it. On 6 November, the Straits Times Index closed almost 11% below its record close from early September. That puts the STI in a correction, just two months after it was setting records. So is a fall this size unusual? Not really, since the STI has dropped 10% or more in around eight years out of every 10. Here's how this STI correction compares with past falls, and what it means if you're investing for years.

How far has the STI fallen since September?

The STI closed at 5,180 on 6 November. That's almost 11% under its record close of 5,802 in early September, which is why it's now officially in a correction.

What's the STI, anyway? It's an index of the 30 largest companies listed in Singapore, weighted by their size. Together they make up roughly two-thirds of the market, so when the STI drops, people say the market dropped.

If you've wondered how Singapore's own reserves are invested, our guide to GIC and Temasek explains how the two differ.

How does this fall compare with past ones?

Falls this size happen in most years. The STI has dropped 10% or more in around eight years out of every 10.

Some past sell-offs packed a big fall into a single day. This almost 11% drop built up over about two months.

On 7 April 2025, as US tariffs set off a global sell-off, the STI closed 7.5% lower, down 285.36 points in one session. That was its biggest one-day loss since the 2008 global financial crisis.

Two older days were in the same range. The STI fell 8.3% in a day in October 2008, during the global financial crisis, and 7.4% in March 2020, during the Covid-19 pandemic.

Three of the STI's biggest one-day falls, 2008 to 2025

Three of the STI's biggest one-day falls, 2008 to 2025
MonthFall in one day
Oct 20088.3%
Mar 20207.4%
Apr 20257.5%
Source: The Star (The Straits Times/ANN), 7 April 2025

Markets are hard to predict, so no past fall can tell you where this one stops.

Real talk: what does a fall like this mean if you invest for years?

It depends on when you'll need the money. The longer you stay invested, the more time you have to ride out swings like this one.

It helps to zoom out on the chart, too. A month of falls can look alarming, while a ten-year chart may tell a very different story. Judge the STI over a stretch that matches your own time frame.

Selling in a panic during a downturn can leave you with a real loss. (Harder than it sounds when the app is all red.)

Part of the pull is how losses feel. Losing S$1,000 tends to hurt about twice as much as gaining S$1,000 feels good. Knowing that won't make you immune, but it can help you set a few guardrails.

Time in the market is what lets returns build on each other, and our guide to compound interest shows how that adds up.

Before you act on a fall, it helps to be clear on three things:

So, what can you do this week?

Mostly, you can slow your own reactions down. These four habits keep a red week from turning into a rushed decision.

Four habits for a red week

  1. Write your plan down

    Goals, time frame, when you'd sell and the most you could lose.

  2. Check less often

    A review every quarter or half-year, not a daily scroll.

  3. Pause before big moves

    Let the feeling from a headline pass before you change anything.

  4. Get a second opinion

    Talk a large change through with someone who'll push back.

Write your plan down first. Put in your goals, how long you're investing, when you'd sell and the most you could lose without changing course. Read it before any big move.

Then check less often. The more often you look, the more short-term losses you see. A review every quarter or half-year gives you fewer of those moments.

Pause before any big change a headline set off. A decision that feels urgent today can look very different once the feeling has passed. For a large change, a second opinion from someone who can challenge your thinking helps too.

If you already invest a fixed sum every month, that's called dollar-cost averaging. At S$1,000 a month, you buy more shares when the market is down and fewer when it's up, without trying to time it.

If retirement is your long game, our FRS calculator shows the CPF sums you're building towards.

This week, set up a regular review schedule, quarterly or half-yearly, and put the first date in your calendar.

Frequently asked questions

How far has the STI fallen from its record?

On 6 November, the STI closed at 5,180. That was almost 11% below its record close of 5,802 in early September, which put the index in a correction.

How often does the STI fall 10% or more?

In around eight years out of every 10. Single days can be sharp too: on 7 April 2025, the STI closed 7.5% lower, its biggest one-day loss since 2008.

What should I check before selling in a fall?

Check when you'll need the money, what a bigger loss would do to your loan repayments or goals, and what your written plan says. Selling in a panic during a downturn can leave you with a real loss.

What is dollar-cost averaging?

It's investing a fixed sum at regular intervals, whether the market is up or down. You buy more shares when prices are low and fewer when they're high, so you stop trying to time the market.

Sources

Keep exploring

This is general financial information for Singapore, not personal financial advice. Figures change, so verify current rates against the official sources above before acting. See our full disclaimer.

Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).