Hi guys, having a dilemma whether to buy the cast kilobar from UOB.
Their selling selling and buying rate for 10th May 2012 is
CAST BARS SGD 1 KILOBAR 68855.57 64111.00 ( Inclusive of GST)
I checked with them a few things:
1. Does the bar comes with certificate? Ans: No. only with UOB receipt.
2. Will the GST be exempted ? Ans: Yes, but must wait till 1st of October 2012.
So should i buy or don't buy? sigh....
Don't buy. You're basically writing a $4,000 cheque to UOB (the spread) and a $4800 cheque to IRAS (the GST)
You could save yourself a lot of money by buying a gold exchange-traded fund.
Yeah, I believe I have done enough research to correct Shiny Things answer [childish grin
]
Current price(s) fr their site.
CAST BARS (SGD) 1KILOBAR Sell:68855.57; Buy:64111.00
GOLD CERTIFICATE(SGD) 1KILOCERT Sell:64351.00, Buy:64151.00
I take the true price of the 1kg bar to be $64,351 (acc UOB cert= bar, just that for now, like hamburger/ biscuit, U pay GST to IRAS through UOB to take it home (and consume it by wearing it as a pendant)), 64351*1.07= 68855.57 ; the $4504.57 for GST will contribute to operation costs towards the democratic conduct of the coming Hougang by-elections (just jokin but U get the drift).
For having to check if U tampered with the bar upon your wish to return it to UOB, UOB will charge U the usual $200 cert spread + additional $40 for the inconvenience that U had caused them (U could have taken just the cert).
68,855.57 is the total take home price for the bar (GST inclusive).
If U think gold price will increase and trust UOB then why not just take the cert, wait until October then take the bar and don't pay any GST on 1kg bar. I doubt UOB will be liquidated (bankrupt) before Oct2012 so I think that that's quite a safe bet, alternatively, pay UOB $36 p.a. to keep the quantity for U (unallocated gold means UOB can later give U any bar and not a particular bar).
Only problem is if there is bank run on UOB then good luck but think MAS capital requirement for SG banks quite strong so U don't have to practice running, at least not for now, probably better paying the $36 p.a. to UOB than keep the bar under your pillow. (lost = almost impossible to retrieve I think)
Rgds
C6.
Disclaimer: This does NOT constitute any form of professional advise, any investment based upon my comments is at the sole discretion and risk of the user.
