sgh Just to confirm with you for redeeming SSB earlier, the accured interests are counted based on days or months?

E.g. for the Sept 2022 issue which I plan to redeem, if I apply to redeem now, the accrued interests will be including the whole month of October or just up to today (assume I apply to withdraw today)?

The SSB website formula counts based on days  https://www.mas.gov.sg/bonds-and-bills/inve...s/how-to-redeem

but my SG friend says it's counted by month (i.e. irrespective of which day in the month you apply to withdraw, the entire month's interests will still be accrued and paid back).

Just want to confirm. Thanks.

The URL has a formula at the bottom it count the days. It will accrued interest until the day the monies credit into your bank account (exclude the day interest come in) You redeem early or late in the month is the same so later can give you more days to think over

Better than MYR FD.. time to diversify

Yes I made it!

6M Cut off yield 3.77% p.a. https://www.mas.gov.sg/bonds-and-bills/auct...date=2022-10-18

1Y Cut off yield 3.72% p.a. https://www.mas.gov.sg/bonds-and-bills/auct...date=2022-10-18

Actually rates won't be better by a lot. Strong SGD/USD means the treasury bill rates will be slightly lower than US comparatively. There is an inverse relationship between currency and interest rates.

But ya you are right that dry powder is finite, maybe can skip the next few weeks T-bills, or bid closer to US rates to safeguard myself from kiasu kiasi low bidders in SG.  

(Some fellas on HWZ actually bid 0.01%..., hopefully it's just a troll.)

Ya, thanks to your tips, just started with 6M T-bills @ 3.3% p.a. 2~3 weeks back. If it hits 4.5% p.a. can consider lock in 1-yr.

Yes, only started converting since last month seeing how MYR has been depreciating against SGD lately... Also planning to buy some S-REITs which are "on sale" now due to high interest rates.

You lock-in if you think the yields have peaked and can't go higher. But if the Fed still wants to do it the "Volcker style" and inflation couldn't ease, you may lose some opportunities for higher yields during the 1-year period. At least that's what I read from BT yesterday (see my post above).
Which chat group is that? Can I join? Or it is just for lawyers only?

Ya that's correct, but the problem is we don't know when the yields would have peaked. And there might be some delays between run-up and yield peaking if the crisis and market stress drag on for some time.

Just my 2 cents, as long as harmonics3 manage his cash flow well liquidity shouldn't be an issue I think.

We just got a very reliable indicator for tomorrow's 6M T-bill auction.

12-week MAS bill auction results today: https://www.mas.gov.sg/bonds-and-bills/auct...date=2022-10-28

Cut-off 4.35%, median yield 4.2%. But average a bit low at 3.59%.

Median yield moving closer to cut-off, suggesting many bidding between 4.2-4.35% p.a. for a 3M equivalent T-bill.

All number in units of p.a.

Hi bro.

3 month is just a hypothetical comparison. MAS stopped issuing 3M T-bills since 12 Dec 2013.

Yes, funds will be locked up for 6 months/1 year in general. If you need, you can sell OTC via the 3 primary dealers (UOB, OCBC, DBS). But in general do expect some spread there (I have no data on spread as I have not found anyone who sold these bills and commented over the Internet).

So, you need to time your cash flow well enough as most people hold till maturity.

If anyone stay in SG can drop by any DBS, OCBC and UOB branch to query about T-bill spread that would be very nice info to update us here.

A phone call to the branch can also be sufficient already if I am not mistaken.

Thanks!

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Add-on: Today is also the last day to redeem previous months' SSB(s) if you want to subscribe to Nov/Dec22 or future issues with higher average rates. Remember to do so before 9 pm.

First S-bank to report 3Q results: UOB

https://links.sgx.com/1.0.0/corporate-annou...738daa9b6c302b9

DBS and OCBC reporting next week.

Seems to me the NIM expansion and NII income rise contributed a lot to the banks profits. But already the yield curve is inverting, worries me if the rates start to go down again plus economy turns bad. That would be double whammy for S-banks.

But so far SG economy holds up better than the US, it seems.

Yes, I submitted 4.1%. Anything below 4.19% you surely get allocated. Those bidding at 4.19% will get partial allocation (14% of original bid amount in this case).

I know someday somebody will ask this question. So I already prepared something for you guys earlier.

Here is an Excel spreadsheet to simplify stuffs: [attachmentid=11292952]

Here is your reference: https://pages.stern.nyu.edu/~wsilber/treasurybills.pdf

Haha I actually use that spreadsheet to check for myself too.

Anyway, note that the actual returns (Effective annual rate) will be lower than the 4.325% computed if you strictly discount your cashflow based on the day you pay to MAS via DBS/OCBC/UOB.

When I use sis Gracie's IRR spreadsheet calculation, it turns out that for our case where we paid on 26th Oct, discount paid back on 27th and mature on 2nd of May 2023, the actual effective annual rate is about 4.18% p.a. (coincidentally about the same as the cut-off yield of 4.19%, but not related mathematically at all).

If you alter the date to a theoretical situation where you pay 1000 SGD on 1st Nov, discount paid back on 1st Nov, and mature on 2nd May 2023, then Gracie's IRR spreadsheet will show the correct 4.32% p.a. effective annual return.

Just some "bond convention" nuances to take note of.

Uhm I don't quite get your point bro. The T-bill rates are benchmarked against major market yields, in particular US 6 month yield, in our case. So, it's known to the public to a high degree of certainty, barring those who bid at 0.01% if they choose to.

And effective annual yield is always higher than the quoted cut-off yield due to the nature of computations.

For your concerns on the non-comp. Again, first check the markets. If it's already 4.5% in the US, and recent benchmarks from MAS bill whose bids are from institutions or previous day T-bill yields all indicate range of 3.6% to 4.3%. Your range is pretty much narrowed down.

It can't be 2% unless the market yield is indeed close to 2% p.a. Then you might as well not bid at all in the first place, or put a high bid (say 2.5% or even 2.75%) to secure your returns.

And no, MAS can't fix the yields themselves. Remember it's BBC framework in Singapore. Basket, Band, Crawl. MAS never influence the rates, they only influence SG$NEER. The yields are determined by market participants like us.

I don't really get your question. Would be nice if you could clarify bro.

Ah I see the issue now bro. Yields are always quoted per annum.

This is standard market convention. Just like your fixed deposit bro. You never see people talk about 0.333% for 1 month FD, but 4% p.a. FD for say, 12 month.

Have been thinking about this bro.

Your statement is only true if:

MY retirement inflation rate < SGD/MYR appreciation rate + SG retirement inflation rate 

So it kind of depends on your retirement spendings and also the rate at which BNM prints money.

Personally - best to retire in countries with high enough medical facilities & standards, yet cheap enough health care, food & blue-collar services like home/electrical/wetwork maintenance WHILE making passive income in USD, GBP, SGD, etc. Best of both worlds - relative monetary strength with cost effective living

Good that we clear things up!

Uhm for the date. Announcement is from 3rd of Nov yes, you can start buying from that day onwards (or 1 day latter if banks need time to update their system to display the auction details).

Unfortunately, you interpret the next 2 dates wrongly. The auction date is 10th of November (Thursday), which is the day the auction results are known, e.g. cut-off yield, median/average yield, BTC ratio etc. So the last day to apply is 1 day earlier 9th of Nov (Wednesday) (and time is usually 9pm for DBS ibanking applicants, sources on HWZ claimed 12 pm for UOB/OCBC, so it depends on the banks, make sure you check with them by login into the respective online banking portal).

SG T-bills are issued every 2 weeks, and for this year, you will notice the auction day is always a Thursday. And the last day to apply is 1 day prior to it, i.e. Wednesday.

1 year T-bills are issued every quarter (so 4 issues per annum).

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As for whether I will apply, it really depends on the rate movement. Now the yield curve is inverting, so the rates may peak sooner than we thought. I will keep a close eye on US 6M rate before deciding. If rates aren't too far from current levels, I will bid higher to secure my position, otherwise, I will just forego the auction for the next one.