*Official* Shiny Things club - Part 2

[celtosaxon]

sorry, missed out on your message earlier. nope.. no friends nor relatives in NYC. haha
citi priority $70k SGD
citi gold $250k SGD
this is getting more troublesome than i earlier thought. hahaha

If you have no friends or relatives living in the US, why on earth would you even think about retiring there? Once you become a resident, you become a US person for tax purposes... enter the nightmare of taxation and reporting obligations.

If you are really dead set on getting a US bank account, I still think the IDNYC route is worth looking into - read the fine print, there is even a way to apply for one as a homeless person or illegal alien. IDNYC is free of charge so it’s no harm trying, but you will need to know the address of your accommodations over a 2 week period from the date you apply.

For example, one document IDNYC will accept is a medical bill that has your US address on it. Nothing stopping you from going into any clinic and getting a tetanus shot (you should get one every 10 years anyway) and just list the address of your US accommodation when you register at the clinic.

You would need to plan ahead and apply online for the IDNYC prior to arriving in NY with an appointment date close to your arrival date, so you can hit the clinic, get your document and then head to appointment. Once you submit your application it should arrive in the mail within 2 weeks.

 

[Shiny Things]

Is there a way to invest in say, 3-month USD LIBOR contract?

Depends what you want to do.

LIBOR, may it rest in peace, is basically just an index: 3mth USD LIBOR reflects the interest rate that banks would charge each other to borrow USD for three months at 11am on the fixing day (or, more likely, it reflects the interest rate that the swaps desk needs to juice their PnL on their swap fixings AM I RIGHT?)

If you just want to invest your cash and earn 3s USD Libor, you can't do that because you are not a bank. You can get close by buying floating-rate USD IG corp bonds, but don't forget the tax.

If you want to actually trade the moves in your Libor of choice, then you can chuck it around in eurodollar futures on Globex (for USD interest rates; there are equivalent futures for euribor, short sterling (GBP), and euroswissie, the deadest market in the world), which is great because they're pretty much the most liquid market in the world (and it's fun to trade, too: if I'm being totally honest rates markets make a lot more sense to me than FX). They're quoted "100 minus Libor", so… sell the futures: you make money if Libor fixes higher; buy the futures: you make money if Libor fixes lower.

 

[Shiny Things]

Hi Shiny, for those of us who consider our CPF as the bond portion of our portfolio, it doesn't exactly provide a hedge against our equity portfolio in the sense of price fluctuations, right?

Nah, it absolutely does. Something with a fixed price is a pretty good hedge against anything: zero correlation means it's always going to make your portfolio less volatile.

Hi Shiny Things, from my understanding you need to maintain 10k or 100k (whichever, not too sure) in your IB or you will be charge with some kind of fee. If I am not planning to put 10k or 100k inside and will only start putting in 3k sgd in IWDA every 3 months, will you still suggest going with IB?

Yep.

Understand that MBH is the new replacement for A35.

Is MBH superior to SSBs as well?

I think it is. On the one hand, MBH doesn't have the price guarantee, but its price shouldn't be particularly volatile. On the other hand, though, MBH will have a notably higher yield, even higher than an SSB held all the way to maturity. I'd rather own MBH myself.

Would there be any real benefits to transfer funds from SSBs to MBH?

Mmm... nah, not really. If you own an SSB, you'll want to hang on to it to get that phat yield at the back-end.

 

[Shiny Things]

Are there any reasons why someone would want to get [the Temasek 2.7s of 2023] over MBH?

I don't think so. MBH gives you broader diversification and a higher yield.

The Temasek bond is probably appealing to the sort of investors who are required to only buy AAA paper, but that's not most retail investors. You're not constrained to investing in AAAs, and there's plenty of value in going out into the broader corporate universe.

 

[BBCWatcher]

You can get close by buying floating-rate USD IG corp bonds, but don't forget the tax.

No tax on those for non-U.S. persons resident in Singapore, at least if directly held and often if indirectly held.

 

[zissou]

I think it is. On the one hand, MBH doesn't have the price guarantee, but its price shouldn't be particularly volatile. On the other hand, though, MBH will have a notably higher yield, even higher than an SSB held all the way to maturity. I'd rather own MBH myself.

Which would you recommend?

- Sell A35 and use the proceeds to buy MBH
- Keep existing A35 and only buy MBH from here on
- Split the bonds component equally between MBH and A35

 

[tangent314]

Depends on how long you intend to hold the MBH for. This will determine if the improved yield will cover whatever fees you pay for switching.

 

[Maeda_Toshiie]

Saint Jack talking to Morning Star a couple of days ago:

https://www.youtube.com/watch?v=x5fX0CdESMk



Bleah, couldn't get the embedding to work.

 

[Lasogette]

Hi Shiny, just wanted to check if you have any experience of is there any with holding tax on Muni Bonds ETF (IIM) and 20 years treasury bonds ETF (TLT) and if it is possible for a singaporean to purchase the USA treaury bonds directly instead of using an ETF.

 

[BlackRozeInc]

Mmm... nah, not really. If you own an SSB, you'll want to hang on to it to get that phat yield at the back-end.

The missus and I are actually using SSB to put aside our money (a grand a month) for the next 3 - 4 years to save up for our own place. We're only a few months into it. We got it because of the guaranteed capital when we redeem it and a nicer yield, rather than keeping it in our joint bank acct.

Would you recommend us just keeping to pumping money into SSB or get MBH instead?

 

[peipei1]

Saint Jack talking to Morning Star a couple of days ago:

https://www.youtube.com/watch?v=x5fX0CdESMk


Bleah, couldn't get the embedding to work.

Jack spoke about that earlier this year, so did BlackRock ceo. 10 years with 4% annual returns feels riskier than cpf.

They are speaking from US perspective, to reduce our exposure, buy more EIMI or my dislike, investment in Singapore properties?

Buying EIMI as a separate counter is advantageous over VRWD, i can overweight it depending on market conditions? The current price of EIMI look tasty.

 

[KeytoFreedom]

I think it is. On the one hand, MBH doesn't have the price guarantee, but its price shouldn't be particularly volatile. On the other hand, though, MBH will have a notably higher yield, even higher than an SSB held all the way to maturity. I'd rather own MBH myself.

Mmm... nah, not really. If you own an SSB, you'll want to hang on to it to get that phat yield at the back-end.

Hi Shiny,
The MBH seems pretty illiquid...today there is only 1 trade and the trade value is only SGD19k.
The A35 is volume is also very low, only 4 trades, SGD35K.
Is this a concern? thanks

 

[KeytoFreedom]

Hi Shiny and all,

How would you compare Vanguard's Index funds vs ETFs (e.g. VWRD/EIMI) ? which is better to invest?

 

[hengah_ongah]

I’m gonna reject the premise of your question: why are you buying a high-yield ETF in the first place? Are you retired, and you need the income?

Hello, I cant justify myself that an accumulating etf is better than a distributing etf.

When market falls, an accumulating etf also drop in value. Isnt it better to have 2 birds in ur hand than 3 in the bush?

For accumulating, are we just hoping that the index will be higher than yesterday during retirement?

 

[KeytoFreedom]

Hi all,

Could someong confirm i've got the right tickers:

EIMI is "iShares Core MSCI EM IMI UCITS ETF"
VWRD is "Vanguard FTSE All-World UCITS ETF"
both listed in London right?

Thanks a lot!

 

[swordsly]

Hi all,

Could someong confirm i've got the right tickers:

EIMI is "iShares Core MSCI EM IMI UCITS ETF"
VWRD is "Vanguard FTSE All-World UCITS ETF"
both listed in London right?

Thanks a lot!

Should be correct.
But why would you want both? VWRD already has EM inside.

 

[Maeda_Toshiie]

Another video, this time about ETFs (or in this case VXX, an ETN). Most index tracking ETFs, especially those big ones tracking major stock indices are perfectly good for long term investors. On the other hand, those strange wacky ones are meant for professional traders who know what's going on.


https://www.youtube.com/watch?v=z2eOhcWEPFY


As always, read the prospectus.

 

[SpeedingBullet]

Depends what you want to do.

LIBOR, may it rest in peace, is basically just an index: 3mth USD LIBOR reflects the interest rate that banks would charge each other to borrow USD for three months at 11am on the fixing day (or, more likely, it reflects the interest rate that the swaps desk needs to juice their PnL on their swap fixings AM I RIGHT?)

If you just want to invest your cash and earn 3s USD Libor, you can't do that because you are not a bank. You can get close by buying floating-rate USD IG corp bonds, but don't forget the tax.

If you want to actually trade the moves in your Libor of choice, then you can chuck it around in eurodollar futures on Globex (for USD interest rates; there are equivalent futures for euribor, short sterling (GBP), and euroswissie, the deadest market in the world), which is great because they're pretty much the most liquid market in the world (and it's fun to trade, too: if I'm being totally honest rates markets make a lot more sense to me than FX). They're quoted "100 minus Libor", so… sell the futures: you make money if Libor fixes higher; buy the futures: you make money if Libor fixes lower.

Lmfao. Yeah figured, only banks can do LIBOR (or any. BOR) because they’re.. well.. banks.

No that wasnt my intention to speculate on interest rates. I’m not smart enough. I thought I could park my excess USD in some low yielding safe sh1t.

Short term treasuries are lookig attractive but apparently in IBKR bond scanner i cant tell normal tbills apart from the zero coupon ones. Although the YTM is essentially the same for some (depends on ask px). I bought a zero coupon march expiry to make some stupid money, thought there would be better ways out there.

 

[matcha18]

IWDA

Hi Shiny Things,

IWDA is currently at its highest 54.39 and its lowest in the last 52w was 38.36, which seems rather volatile. Why is this counter still highly recommended at this price given its volatility?
What was its trend in the past?
Can we still buy at this price?
Are there any US ETFs that we could consider?
Thanks.

 

[limster]

Hi Shiny Things,

IWDA is currently at its highest 54.39 and its lowest in the last 52w was 38.36, which seems rather volatile.
Thanks.

Can you tell me which day in the last 52weeks was the price of IWDA 38.36?