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Old 30-04-2014, 11:21 PM   #22
Shiny Things
Supremacy Member
Join Date: Dec 2009
Posts: 8,594
No problem, i think its all still relevant and i'm trying to digest the info.

A bit confused with all the different ETFs mentioned though

- So VT is in NYSE and VWRL is its equivalent in LSE (so can avoid 30% dividend tax)

- But VWRL trades in GBP and GBP to SGD is more expensive than GBP to USD

- and then VWRD is the USD equipvalent of VWRL... so means VWRD=VT=VWRL but VWRD trades in USD in LSE

- So VWRD is the best option as it is in LSE (So avoid 30% dividend tax) and trades in USD (better conversion rate than GBP to SGD)
Yep, you've basically got it. There are a few other quirks though:
  • You don't dodge the entire 30% tax, only half of it;
  • VWRD and VWRL are a bit more expensive to trade, because the spreads are quite wide (that'll cost you an extra 0.2% upfront)
  • Nobody seems to know whether you get slugged stamp duty on VWRD and VWRL or not, and I'd dearly love for someone to just buy the damn things and tell us if you get slugged stamp duty or not.

Also VWRD isn't quite as liquid as VT - right now the market maker in VWRD is quoting about 0.2% wide in about $1 million a side. VT is 0.05% wide in pretty much any amount you like.

Read about this bond option somewhere as well.. Can elaborate or provide some links about it?

Appreciates all the input.
I'm a bit dubious about piling it all into 30-year bonds, mostly because when (if, not when) rates go up, those are going to suffer some substantial capital losses (and if you roll from the old to the new 30-year, instead of holding to maturity, you're going to lock in those losses).

The ABF bond fund has two advantages: its duration is much shorter, so it'll lose less money (or none at all) when rates go up; and it gives you a bit of diversification. I've heard from decent sources that Singaporean government agency bonds give you a pretty substantial yield pickup over govvies for no extra risk, so that's a bonus. Any bond traders out there who can comment on the spreads between, say, HDB and the govvies?
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