Singapore Savings Bonds Rates Increased - Have You Applied?

With the recent interest rates hikes in both United States and the rest of world (Singapore included),  the interest receivable from fixed income instruments like bonds have also risen. Interest from such instruments are a good viable passive income source and of course the person must do his or her own due diligence in any investments (bonds included)!

In Singapore, the Singapore Saving Bonds (SSB) rates have similarly rose since the beginning of the year. I've compiled the chart below (source of data: Monetary Authority of Singapore - website) for a period from January 2022 to the latest bond offered in January 2023, and from the chart, you could see that  rates are steadily rising from 1st year till the 10th year mark of each new SSB offered.

Singapore Savings Bonds Rates (Jan 2022 to Jan 2023)

Of course, along the way there are adjustments in the rates, i.e. the increases are not exactly uniformed from year to year of each issue. The interest offered for 1st year has increased but to balance the overall interest offered over 10 years, some of the "curves" might not be as uniformed.

Nonetheless SSB is considered a very safe and flexible instruments and interested parties could go to the MAS website to take a look. The payout is distributed twice a year. The applications and subsequent redemptions are also easy, i.e. online via electronic banking, or at the ATM machine. The only hurdle (if any) is that you need a CDP (Central Depository Pte Ltd) account.

Interested to apply for the next SSB?

Invest Fair 2011 @ Suntec (13 - 14 Aug)

The spate of bad news might have dampen some markets around the world, but it certainly didn't dampen the appetite of Singapore investors and traders. This was evident in the turnout at the Invest Fair 2011 at Suntec. There was a large crowd at this event - not like the scale of IT fair, but sufficient enough people to fill the hall.

I was at the Invest Fair this afternoon, and there were large groups of people thronging the different booths. There were a healthy number of financial firms offering different products and services. Many companies are familiar names with local investors. For example I saw Shareinvestor.com, GFT, Philips, Lim & Tan, Traders Round Table and many others.

Some companies had live talks at their booths, while others rolled out big gimmicks (see the car below - from City Index). I guess folks who went to Invest Fair would already have a clear purpose of their visits, and gimmicks are not that necessary. The 'big sign board' by AIA rightly summarised a key aim of many investors - Future Proof Your Wealth. I would prefer cut in commission charged for my trading vis-a-vis any chance to win anything.

What was of interest to many people were the seminars. The seminars were practically packed full. I couldn't get any seats, and had to stand just outside the seminar area in order to peep at what was going on. I think many visitors were hoping to catch some tips / strategies to deal with the current volatile market.

Even after the seminar, many people still surround key personnel who was willing to share more about their views in the current market. I guess we the investors (or punters if you like) are often captured audience of experienced traders who shared valuable insights.

The Invest Fair 2011 is a free event, and thus for those who are interested, do drop by on Sunday for a visit. The location is Suntec Exhibition Hall 401, and opening hours are 10am till 7pm. Invest Fair also had a website with more details about the speakers, exhibitors, and other paid workshops.

US market, AA+, and QE3 - what it means for Singapore market

Standard & Poor has downgraded the US credit rating from AAA to AA+, while Fitch & Moody maintained a poor outlook for the US. I guess the downgrade is to be expected after the pro-long battle between the Democrats and Republicans over the US debt ceiling debates. It is strange that the US's economy is held ransom by the bi-partisan divide, i.e. internal politics literally killing the country. It is worrying that such a stalemate scenario is likely to happen again and again since the debt deal involved the setting up of a bi-partisan committee to decide on deficit cutting measures.

One clear effect of the debt deal is that there will be a form of Quantitative Easing coming up, i.e. QE3. This was an effect observed by Li Daokui, an adviser to the People's Bank of China. So once again US government will unleash large amount of money, and that means stock markets, commodities and prices around the world will go through another round of the roller-coaster ride.

For a start, US dollar will crumple if QE3 comes about. No brainer there. Arbitrage opportunities will be abundant for the fore market, since different currencies will react to different degree to the weakening US dollar. Sing dollar should not rise as much compared to some currencies, since Sing dollar is pegged to a basket of currencies. This also means inflation will be a bigger headache in the months to come for the Singapore consumers.

After the forex effect, next will come the general uplifing of the stock market. It was a blood bath for the past few days. In the coming weeks, there will be bargain hunting, as funds with large inflow of liquidity will hunt for safe / growing stocks in Asian markets. Singapore stock market will feel the positive effect, since funds find it easier to trade the Singapore stock market. The effect will not be over-powering, but a general rising tide should lift many ships.

So in the coming weeks, look out for valued stocks / blue chips / reliable S-Chips in the Singapore stock market. At least earn some in order to offset the inflation that will come. :)

SembCorp Marine - 1H 2011 Net Profit @ S$300.4 million

At the close of the market today, SembCorp Marine announced that it achieved a net profit of S$300.4 million for 1H ended 30 June 2011. This is 8% lower compared to the corresponding period in 2010, attributable mainly to the timing in recognition of new rigs projects since 4Q 2010.

I guess that last statement simply means there will be more profits for the 2H of 2011 then.

In addition, SembCorp Marine announced that it will be giving out a one-tier tax exempt interim dividend of 5 cents per share (i.e. $50 for a lot of 1,000 shares), the same amount that was paid out in 1H 2010. This interim dividend will be paid on 31 August 2011.

The full report, including charts about the turnover and other details (e.g. profit margins) can be found on SGX website.

SGX's 1st Full Day Trading - 1st Aug 2011

1st August 2011 marked the first full day trading for counters on the Singapore Exchange - SGX. The US debt deal lifted markets across Asia and thus SGX is no exception; it rose 26 points (0.82%) to end at 3215.27. Top volume counter was clinched by Genting, which closed 4 cents higher at $1.94, with a volume of 95,528 lots traded. There was even a transaction at 13:29:27 with 2000+ lots traded.

So I guess the 'full day trading' became a non-event, i.e. no particular news about the effect of full day trading on SGX. Perhaps the actual effects will be seen in a month or two, when dealers / remisiers have enough comments to give a proper full account of this new change. Trading volume seemed alright on 1st August, but hard to say if the volume an effect of US debt deal, or because of the full day trading.

See related:

- Full Day Trading on SGX on 1st August 2011

US Debt Crisis & Singapore Stock Market

As of 11:48pm 26 July 2011, US Dow Jones industrial average is down by about 0.5% or 60+ points. US market is still trying to digest the uncertainties surrounding the US debt crisis. Weirdest thing is that Asian markets closed generally positive today. The markets have started to build in possibilities of US debt default and frankly, many of the Asian companies have stronger fundamentals that should be able to tide these companies against tsunami effect of a US debt default.

Sure, if there is indeed a default, many companies will be hit badly (it is indeed a financial tsunami) but the growth story is already in Asia, not US. Past the effect of the financial tsunami, business will still go on in Asia. Of course, many are confident that the Washington will arrive at a solution, and 2 August is not the final deadline for the debt default. Thus Washington does have more than a week to sort out the issue.

Focusing on Singapore market, the counters have performed fairly well this week. India's hiking of interest rate by 50 basis points, and the debt crisis seemed not to have any major effect on the Straits Times Index. It closed at 3,186.57, near the closing of 2010. Jardine ($49.91), UOB ($20.50), SembMarine ($5.44) and SingTel ($3.33) have all gained. 

So would the Singapore market performs tomorrow? My guess is that should US DJIA sustain above 12,500 tonight, things should turn out normal (if quiet) on 27 July 2011.

Full Day Trading on SGX from 1 Aug 2011

It is no longer news to many in the stocks market that SGX will be introducing full day trading from 1 August 2011.  There goes the 90 minutes lunch break which serves as much needed rest for the traders / remisiers. There are two clear advantages:

a) Investors can react faster to news, especially for news in Asia that can impact their stocks. Thus they can trade during the original lunch break to take advantage of market reactions.

b) More trading can happen since the number of hours for trading per day has effectively increased by 90 minutes. This benefits both SGX as well as the brokerage houses.

However, I don't see much advantage for the remisiers. The availability of lunch hours for direct trading, means more clients will switch to online trading at their own computers, essentially cutting down the number of clients for remisiers. Currently, clients who are only free during their lunch breaks, will be more comfortable to call their remisiers and place orders. In furture, they will just click at their computers.

I guess other than technology (online trading platforms), remisiers are now hit by developments of stock exchanges as well.

See related:
- SGX's 1st Full Day Trading - 1st Aug 2011