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New 6-Month Singapore T-Bill (est. 3.2%) Available on Auction Until 29 September 2022

Here is a short notice: a new six-month Singapore Treasury Bill will be on auction next Thursday, the 29th Sep 2022. If you wish to subscribe to the T-bill, you must enter before 29th Sep, preferably on the 28th Sep.

In the past, I have shared with you the virtues of the Singapore T-bills, their ideal uses, and how to subscribe to them here: How to Buy Singapore 6-Month Treasury Bills (T-Bills) or 1-Year SGS Bonds.

In the last issue announced two weeks ago and recently concluded, the current t-bills were trading at a yield of 2.92%. In the end, the cut-off yield for the t-bill ended at 3.30%, which is vastly higher than expected.

If you placed a non-competitive bid, which most of us do, you would have gotten the 3.30%.

The table above highlights the yield current six-month Singapore T-bills trades at. This is to give you a sense of recent yield trends, but in all honesty, whether the yield is 3% or 3.2% or 2.7%, they are decent yields unless you are a micro-manager trying to win every ounce of things.

Given the trend in rates, most likely, we will see this yield for a while.

Here are your other Higher Return, Safe and Short-Term Savings & Investment Options for Singaporeans in 2022

You may be wondering whether other savings & investment options give you higher returns but are still relatively safe and liquid enough.

Here are different other categories of securities to consider:

Type of SecuritiesRange of ReturnsLock-inMinimum
Fixed & time deposits on promotional rates1.8% – 2.6%12M to 24M> $20,000
Singapore Savings Bonds (SSB)2%-2.63%1M> $1,000
SGS 6-month Treasury Bill2.5% – 2.95%6M> $1,000
SGS 1-Year Bond2.92%12M> $1,000
Short-term insurance endowment1.8-2.7%2Y – 3Y>$10,000
Money-Market Funds2.39%1W> $100

This table is updated as of 8th September 2022.

Here are some further comments about the different types of securities:

Type of SecuritiesRemarks
Fixed & time deposits on promotional rates
Singapore Savings Bonds (SSB)Maximum $200k per person. When in demand, it can be challenging to get an allocation. A good SSB example.
SGS 6-month Treasury BillSuitable if you have a lot of money to deploy. How to buy T-bills guide.
SGS 1-Year BondSuitable if you have a lot of money to deploy. How to buy T-bills guide.
Short-term insurance endowmentMake sure they are capital guaranteed. Usually, there is a maximum. A good example Gro Capital Ease.
Money-Market FundsSuitable if you have a lot of money to deploy. A fund that invests in fixed deposits will actively help you capture the highest prevailing interest rates. Do read up the factsheet or prospectus to ensure the fund only invests in fixed deposits & equivalents. MoneyOwl’s WiseSaver – Fullerton Cash Fund example.

There are other securities or products that may fail to meet the criteria to give back your principal, high liquidity and good returns. Structured deposits contain derivatives that increase the degree of risk. Many cash management portfolios of Robo-advisers and banks contain short-duration bond funds. Their values may fluctuate in the short term and may not be ideal if you require a 100% return of your principal amount.

The returns provided are not cast in stone and will fluctuate based on the current short-term interest rates. You should adopt more goal-based planning and use the most suitable instruments/securities to help you accumulate or spend down your wealth instead of having all your money in short-term savings & investment options.

If you want to trade these stocks I mentioned, you can open an account with Interactive Brokers. Interactive Brokers is the leading low-cost and efficient broker I use and trust to invest & trade my holdings in Singapore, the United States, London Stock Exchange and Hong Kong Stock Exchange. They allow you to trade stocks, ETFs, options, futures, forex, bonds and funds worldwide from a single integrated account.

You can read more about my thoughts about Interactive Brokers in this Interactive Brokers Deep Dive Series, starting with how to create & fund your Interactive Brokers account easily.

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Philip

Saturday 24th of September 2022

Good article

Aaron

Friday 23rd of September 2022

Hi Kyith,

Does the US 30% withholding tax apply to US Treasuries on IBKR? I am a Singapore investor.

Aaron

Saturday 24th of September 2022

@Kyith, you can buy US Treasuries on IBKR. Just type in US-T and Enter. However, I have not actually bought them yet. Hope you can clarify the steps and any operational issues if you buy them. Cheers

Kyith

Saturday 24th of September 2022

generally it does not apply. But from what i understand... it is also a problem how to buy it. do let me know if you have a method.

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