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Need advice on which bank to park my assets

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Old 13-09-2018, 03:02 PM   #16
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You can buy every month. Cap is by each purchase.
You can always pay $2 to cash it out and buy a new one.
From the official FAQ:

At any point in time, you may hold up to a maximum of $100,000 in
Savings Bonds. This “Individual Limit” is sufficient to meet the needs
of most individuals as more than 90% of individual bank deposit
accounts have balances of $100,000 or lower. Individuals with
larger sums to invest may wish to consider investing in SGS.


Are you referring to the SGS? For the SGS the market prices fluctuates and they have been dropping steadily. https://secure.sgs.gov.sg/fdanet/Sgs...suePrices.aspx
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Old 13-09-2018, 03:02 PM   #17
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I am waiting for a major stock market crash to the region of 2600. It may be wishful thinking but I believe it will be a 100% profitable opportunity for a long term buy and hold investor. I am not sure how long I need to wait but 3-5 years is not unreasonable for me.
If waiting for major stock market crash, then just park into IG bonds and wait and wait When market crash, likely bonds go up. Then cash out and go for the market. In the meantime, enjoy the coupons.
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Old 13-09-2018, 03:09 PM   #18
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If waiting for major stock market crash, then just park into IG bonds and wait and wait When market crash, likely bonds go up. Then cash out and go for the market. In the meantime, enjoy the coupons.
If you genuinely think the Singaporean market's going to dump a further 20%, those wholesale corporate bonds may not be a great idea. A spew that big is going to spill up the capital structure from equities into corporate bonds, and the bonds won't be worth 100 when you go to sell them.
In the past I understand that stock and bond prices moved in opposite directions. But does that still hold true now?
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Old 13-09-2018, 03:12 PM   #19
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You cannot buy more than 100k in SSB per person.

There is no limit to how much in SGS bonds you can hold, nor a monthly cap on how much you can buy.
SGS will not be as flexible as SSB.
But I agreed with original TS. Cash is king now, you never know if the stock market will crash. Especially trade war is still in progress. Impact to our region is not yet realised.

Last edited by cscs3; 13-09-2018 at 03:14 PM..
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Old 13-09-2018, 03:15 PM   #20
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SGS will not be as flexible as SSB.
For my context the SSB doesn't help because of the cap.
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Old 13-09-2018, 03:17 PM   #21
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For my context the SSB doesn't help because of the cap.
May be you have to think of different product. Agreed with you market crash is a matter of time. It cannot be forever good.
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Old 13-09-2018, 03:18 PM   #22
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Cash is king now, you never know if the stock market will crash. Especially trade war is still in progress. Impact to our region is not yet realised.
The problem highlighted is the opportunity cost of leaving the cash as it is. I am anticipating the crash but it may never come and as Shiny mentioned, I may not have the courage to pull the trigger especially when the investment amount is substantial.
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Old 13-09-2018, 03:20 PM   #23
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You can always pay $2 to cash it out and buy a new one.
No, that's for Singapore Savings Bonds only, and SSBs are limited to $100K per individual. Even assuming there's a couple in this household, that still leaves about S$2.8 million of idle cash to park.

Shiny Things has made the point that if the Straits Times Index falls to 2,600 or less it's probably because there's an economic recession, economic depression, financial crisis, or other crisis. And, ordinarily, those circumstances would coincide with lower interest rates/higher bond prices. So no problem, right?

I am also not comfortable putting 1M in Malaysian banks.
OK. Well, you can place S$1 million in a 6 month fixed deposit at State Bank of India Singapore and get 1.70% p.a. You can call the deal off and withdraw funds at any time. If you do that within the first 3 months, you get zero interest. If you do that otherwise before maturity then you get one quarter's worth of board rate interest, which is either 0.30% or 0.45% p.a. You could split up that $1 million into 6, 12, and 24 month fixed deposits if you wish, and with higher interest rates for the longer terms.

Don't like SBI Singapore, or want to divide your allegiances? (I would, if I were doing something this crazy.) Hong Leong Finance is currently offering 1.60% p.a. (6 month FD), 1.70% (12 month FD), and 1.80% (18 month FD). If you withdraw funds before the end of the term then you get a board rate of 0.1% p.a. for any completed quarters, less a $50 penalty. Place at least $200K and you might get a free box of mooncakes -- and that would be totally worth it, of course. HL Finance will accept all S$3 million if you wish. (Please don't.)

ICBC Singapore offers an interesting step-up fixed deposit which would suit your purposes pretty well. On the 12 month step-up fixed deposit if you complete 3 months you get 1.45% p.a. If you complete the next 3 months you get 1.78% p.a. (for that period). Complete another 3 months and it's 1.62%, and then if you hold to the end of the term it's another 1.62%. So it's really like a ~1.62% traditional 12 month fixed deposit, but you're not penalized as harshly if you call off the deal after 3 months, 6 months, or 9 months of term. They also offer a 24 month variant. I'm not sure what their fixed deposit limit is.

If you want a 100% government guarantee on that S$3 million -- and who wouldn't want that, ceteris paribus -- then you could buy a 12 t-bill at the auction next month. That'll yield about 1.78% if market interest rates don't change, and it'll be totally transaction fee free. There is a secondary market for t-bills, although there's absolutely no guarantee you'll get any particular price for your t-bill pre-maturity. There are no coupons on a t-bill. You just buy $X, at a discount to face value (determined at auction), and you get face value from the government at maturity. It's the safest place to park Singapore dollars. I think you can park that t-bill with Maybank-Kim Eng, for example, and then use it as collateral against low cost margin (2.88%) to go buy lots of ES3 if the opportunity presents itself. (Or sell the t-bill if you get a pre-maturity deal you like.) If that idea interests you, then just ask Maybank-KE.

Last edited by BBCWatcher; 13-09-2018 at 03:30 PM..
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Old 13-09-2018, 03:21 PM   #24
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May be you have to think of different product.
I am stuck here and that's why my original question was to ask which bank offers the most perks for parking my cash with them.
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Old 13-09-2018, 03:28 PM   #25
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The problem highlighted is the opportunity cost of leaving the cash as it is. I am anticipating the crash but it may never come and as Shiny mentioned, I may not have the courage to pull the trigger especially when the investment amount is substantial.
Wait and wait It will come. To lessen opportunity cost, go for IG bonds that would withstand crash even if there is no flight to safety of bonds or USD. Then cash out and go for the kill
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Old 13-09-2018, 08:11 PM   #26
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IG bonds in Singapore or US?
Singapore T-bonds quite limited liquidity, buy already cannot find seller to sell to how?


Wait and wait It will come. To lessen opportunity cost, go for IG bonds that would withstand crash even if there is no flight to safety of bonds or USD. Then cash out and go for the kill
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Old 13-09-2018, 08:12 PM   #27
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If you want a 100% government guarantee on that S$3 million -- and who wouldn't want that, ceteris paribus -- then you could buy a 12 t-bill at the auction next month. That'll yield about 1.78% if market interest rates don't change, and it'll be totally transaction fee free. There is a secondary market for t-bills, although there's absolutely no guarantee you'll get any particular price for your t-bill pre-maturity. There are no coupons on a t-bill. You just buy $X, at a discount to face value (determined at auction), and you get face value from the government at maturity. It's the safest place to park Singapore dollars. I think you can park that t-bill with Maybank-Kim Eng, for example, and then use it as collateral against low cost margin (2.88%) to go buy lots of ES3 if the opportunity presents itself. (Or sell the t-bill if you get a pre-maturity deal you like.) If that idea interests you, then just ask Maybank-KE.
Thank you. In this scenario if the stock market crashes and the interest rate drops, I still benefit from the "high" interest rate t-bill and also use it as collateral to borrow at a then low interest rate. I win on both ends right?

Can using the t-bill as collateral for the stock market be done only with the brokers or can I go through the banks directly?
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Old 13-09-2018, 08:13 PM   #28
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Liquidity is the problem though.

No, that's for Singapore Savings Bonds only, and SSBs are limited to $100K per individual. Even assuming there's a couple in this household, that still leaves about S$2.8 million of idle cash to park.

Shiny Things has made the point that if the Straits Times Index falls to 2,600 or less it's probably because there's an economic recession, economic depression, financial crisis, or other crisis. And, ordinarily, those circumstances would coincide with lower interest rates/higher bond prices. So no problem, right?


OK. Well, you can place S$1 million in a 6 month fixed deposit at State Bank of India Singapore and get 1.70% p.a. You can call the deal off and withdraw funds at any time. If you do that within the first 3 months, you get zero interest. If you do that otherwise before maturity then you get one quarter's worth of board rate interest, which is either 0.30% or 0.45% p.a. You could split up that $1 million into 6, 12, and 24 month fixed deposits if you wish, and with higher interest rates for the longer terms.

Don't like SBI Singapore, or want to divide your allegiances? (I would, if I were doing something this crazy.) Hong Leong Finance is currently offering 1.60% p.a. (6 month FD), 1.70% (12 month FD), and 1.80% (18 month FD). If you withdraw funds before the end of the term then you get a board rate of 0.1% p.a. for any completed quarters, less a $50 penalty. Place at least $200K and you might get a free box of mooncakes -- and that would be totally worth it, of course. HL Finance will accept all S$3 million if you wish. (Please don't.)

ICBC Singapore offers an interesting step-up fixed deposit which would suit your purposes pretty well. On the 12 month step-up fixed deposit if you complete 3 months you get 1.45% p.a. If you complete the next 3 months you get 1.78% p.a. (for that period). Complete another 3 months and it's 1.62%, and then if you hold to the end of the term it's another 1.62%. So it's really like a ~1.62% traditional 12 month fixed deposit, but you're not penalized as harshly if you call off the deal after 3 months, 6 months, or 9 months of term. They also offer a 24 month variant. I'm not sure what their fixed deposit limit is.

If you want a 100% government guarantee on that S$3 million -- and who wouldn't want that, ceteris paribus -- then you could buy a 12 t-bill at the auction next month. That'll yield about 1.78% if market interest rates don't change, and it'll be totally transaction fee free. There is a secondary market for t-bills, although there's absolutely no guarantee you'll get any particular price for your t-bill pre-maturity. There are no coupons on a t-bill. You just buy $X, at a discount to face value (determined at auction), and you get face value from the government at maturity. It's the safest place to park Singapore dollars. I think you can park that t-bill with Maybank-Kim Eng, for example, and then use it as collateral against low cost margin (2.88%) to go buy lots of ES3 if the opportunity presents itself. (Or sell the t-bill if you get a pre-maturity deal you like.) If that idea interests you, then just ask Maybank-KE.
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Old 13-09-2018, 08:14 PM   #29
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Singapore T-bonds quite limited liquidity, buy already cannot find seller to sell to how?
It is only 12 months. If need to raise money, use as collateral to borrow?
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Old 13-09-2018, 08:19 PM   #30
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12M means yield very low?
I took a look at the SGS 12M and the return is about same as 12M FD only.

Longer tenure means very low liquidity and cannot sell.

It is only 12 months. If need to raise money, use as collateral to borrow?

Last edited by ervino; 13-09-2018 at 08:22 PM..
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