HWZ Forums

Login Register FAQ Mark Forums Read

OCBC Structured Deposit

Share This Page
HardwareZone.com on Facebook
Reply
 
LinkBack Thread Tools
Old 02-07-2009, 11:41 PM   #1
Arch-Supremacy Member
 
revenant's Avatar
 
Join Date: Jan 2000
Posts: 14,455
Thumbs up OCBC Structured Deposit

Helped my mum to invest in this FD today but was pleasantly surprised to see a better deal in the SD offered.

Details about the SD
1) Capital Guaranteed if held to maturity
2) Guaranteed effective interest of 1.55%pa (Compared to 0.75% for FD)
3) Maximum effective interest of 2.05% (The difference is subjected to the performance of the underlying share)
4) 4 years tenor
5) Underlying share was SPC

The minimum subscription is $5000 and the offer period ends on the 2nd to 3rd week of July

Of course, you might argue that the mere 1 to 2 percent will still result in negative real interest rate but hey its the best available according to my mum's risk profile.

Its not listed on OCBC web site, so if you are interested, I can pass you the contact.
revenant is offline   Reply With Quote
Old 03-07-2009, 12:49 AM   #2
Senior Member
 
NumsLock's Avatar
 
Join Date: Feb 2006
Posts: 1,516
eh.. compare with this one which one better?

DBS de..

http://www.dbs.com.sg/posb/investmen...s/default.aspx
NumsLock is offline   Reply With Quote
Old 03-07-2009, 01:14 AM   #3
Arch-Supremacy Member
 
revenant's Avatar
 
Join Date: Jan 2000
Posts: 14,455
eh.. compare with this one which one better?

DBS de..

http://www.dbs.com.sg/posb/investmen...s/default.aspx
Both are quite similar.

I would go for 4 years OCBC SD as I think interest rate might increase after few years and if that happen, we would lose out higher interest for a year if we buy DBS. Of course there are many other factors but for me, this 1 year difference is my biggest concern if I were to compare both products.

However, both are definitely better than FD for sure.
revenant is offline   Reply With Quote
Old 03-07-2009, 02:12 AM   #4
Senior Member
 
Join Date: Jul 2009
Posts: 1,446
So fast ppl forget about the Lehman debacle?
Not trying to pour cold water, but its always good to see the opposite side of an argument even though I am also enticed by structured products, but I have my preferred investment vehicle

FD is FD, and its interest is lower for a reason. It's considered virtually no-risk, as it is covered under the Deposit Insurance Scheme. Structured products, however, is classified under investment products. Thus, its not really fair to compare the 2.

Since there is not much info on the ocbc SD, I shall quote a small print from NumsLock's link on the POSB Invest SingGrowth Account:

"in the worst case scenario, where the Bank defaults, the Customer will receive zero interest payments and lose his original investment amount."

"Note: Structured deposits are excluded from insurance coverage under the Singapore Deposit Insurance Act (Chapter 77A) and the guarantee by the Singapore Government, and carry risks not normally associated with ordinary bank deposits. You should therefore not treat the product as a substitute for ordinary savings or fixed deposits."

Caveat emptor. Low risk low returns, high risk high returns. No free lunch

Last edited by Asure7; 03-07-2009 at 02:16 AM..
Asure7 is offline   Reply With Quote
Old 03-07-2009, 02:35 AM   #5
Master Member
 
Join Date: Apr 2002
Posts: 4,511
If OCBC defaults, I'd be more worried about other things than the monies in the SD.
icyspawn is offline   Reply With Quote
Old 03-07-2009, 03:22 AM   #6
Junior Member
 
Join Date: Jun 2009
Posts: 16
Ever thought of going for those "capital guaranteed" plans from insurance companies??

The last i heard, one of the companies giving guaranteed 2.5% annual compounded interest if you hold till their 5yr maturity date. They'll even throw in insurance component (in the form of death benefits), if you knok before maturity.

So which is better?? Guaranteed or Non-Guaranteed??
investopia is offline   Reply With Quote
Old 03-07-2009, 10:20 AM   #7
Senior Member
 
Join Date: May 2000
Posts: 1,711
there are capial guaranteed and interest guaranteed 2.25% plans around

SPC super high risk stock leh. i wonder how its performance can be pegged to a 'safe' product.
zhiz22 is offline   Reply With Quote
Old 03-07-2009, 10:42 AM   #8
Senior Member
 
kimwee's Avatar
 
Join Date: Sep 2000
Posts: 1,577
Before u buy such products, u need to consider 2 things as well:
1) whats the mid term interest rate trend?
2) whats the likely stock performance on SPC next few yrs?

For me, I have no gd feel on pt 2 but I think interest rates will definitely trend upwards when the economy start to recover. Qn is by how much. So although this product is relatively risk free, the returns may be worse (or eventually same) than a FD if interest rates start shooting up next yr (can be made worse if the SPC stock prices stay put or move v slowly). And remember your funds are locked in for 4 yrs as compared to a FD so the liquidity factor needs to be considered as well.
__________________
にゃ ? (=^・^=)
kimwee is offline   Reply With Quote
Old 03-07-2009, 03:32 PM   #9
Senior Member
 
Join Date: Apr 2004
Posts: 749
the counter is sph...not spc
Blurt2321 is offline   Reply With Quote
Old 03-07-2009, 11:53 PM   #10
Junior Member
 
Join Date: May 2007
Posts: 51
why not use the money and buy sph yourself, you can sell anytime you wish and not earn the miserable interest where u have to keep for 4 year
tth1311 is offline   Reply With Quote
Old 04-07-2009, 01:20 AM   #11
Senior Member
 
Join Date: Apr 2007
Posts: 1,809
Hmm, just found out foreign currency FDs are also not insured under SDIC in the event any local banks should default...

http://www.sdic.org.sg/calculation.html
Chua Zhiming is offline   Reply With Quote
Old 04-07-2009, 02:07 AM   #12
Master Member
 
Join Date: Mar 2004
Posts: 4,393
Agree with tt1311 that it's better bet that you put your $5000 directly in sph and based on current dividends, you should be able to get more than 5% at current price of $3.12.

There is no guarantee that you will not lose part of your $5000 but chances are the price will increase if you are willing to hold for 4 yrs thereby giving you a capital gain besides better returns.
henrylbh is offline   Reply With Quote
Old 04-07-2009, 03:46 AM   #13
Junior Member
 
Join Date: Jun 2009
Posts: 16
Agree with tt1311 that it's better bet that you put your $5000 directly in sph and based on current dividends, you should be able to get more than 5% at current price of $3.12.

There is no guarantee that you will not lose part of your $5000 but chances are the price will increase if you are willing to hold for 4 yrs thereby giving you a capital gain besides better returns.
Alamak... it is obvious that the TS wants to reduce risk by putting it in FD/SD you still suggest him to punt his $$ on high risk investment (we all know stocks is high risk no matter which counter you buy)?
investopia is offline   Reply With Quote
Old 04-07-2009, 06:19 AM   #14
Senior Member
 
Join Date: Apr 2004
Posts: 749
u put 5k into FD, u get meagre rates.

u put 5k into this SD, u get an effective interest of 1.55%pa over 4 years regardless of the performance of SPH.

u put 5k into SPH, u are exposed to the market risk of SPH and after 4 years, u are not sure of the capital.

prob it suits ppl who have some dormat cash, and they do not want to participate in risky investment.

each investor has a diff investment profile...wat may suit u may not suit another person so its easy for u to juz say y not do this and not tat.....
Blurt2321 is offline   Reply With Quote
Old 04-07-2009, 12:58 PM   #15
Arch-Supremacy Member
 
revenant's Avatar
 
Join Date: Jan 2000
Posts: 14,455
Alamak... it is obvious that the TS wants to reduce risk by putting it in FD/SD you still suggest him to punt his $$ on high risk investment (we all know stocks is high risk no matter which counter you buy)?
u put 5k into FD, u get meagre rates.

u put 5k into this SD, u get an effective interest of 1.55%pa over 4 years regardless of the performance of SPH.

u put 5k into SPH, u are exposed to the market risk of SPH and after 4 years, u are not sure of the capital.

prob it suits ppl who have some dormat cash, and they do not want to participate in risky investment.

each investor has a diff investment profile...wat may suit u may not suit another person so its easy for u to juz say y not do this and not tat.....
Finally some souls who are meticulous enough to read all my wordings.
revenant is offline   Reply With Quote
Reply
Important Forum Advisory Note
This forum is moderated by volunteer moderators who will react only to members' feedback on posts. Moderators are not employees or representatives of HWZ. Forum members and moderators are responsible for their own posts.

Please refer to our Terms of Service for more information.


Thread Tools

Posting Rules

Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

Samsung
Rewards