By MoneyBees
Work out a Singapore T-bill's price, discount and yield from the latest MAS cut-off or your own, how much a competitive or non-competitive bid is allotted, and whether cash, SRS or CPF OA makes sense.
MAS uses price = 100 x (1 - yield x days / 365), rounded to 3 decimal places per S$100 of face value. At a 1.92% cut-off for 182 days, the price is S$99.043, so S$10,000 of T-bills costs S$9,904.30.
The full face value. If you were allotted S$10,000, you get S$10,000 back on the maturity date. The difference between that and what you paid is your return. There is no coupon.
A non-competitive bid takes whatever cut-off yield the auction sets. A competitive bid names the lowest yield you will accept, up to 2 decimal places. Bids at or below the cut-off are allotted, and everyone allotted gets the same cut-off yield.
Two reasons. Non-competitive bids are filled first, up to 40% of the issue, and are pro-rated if they ask for more. Competitive bids at exactly the cut-off yield are also partly filled, and MAS publishes the % allotted with each result. Allotments are rounded to S$1,000 at random.
Yes, through a CPF Investment Account with DBS/POSB, OCBC or UOB, once you have more than S$20,000 in your OA. The money comes out after the auction and the face value goes back to your CPF Investment Account at maturity. CPF notes its interest rates may be higher than the yield.
Yes, through your SRS operator's internet banking or app (DBS/POSB, OCBC or UOB). Only the settlement amount is taken from your SRS account, and the face value is paid back into it at maturity.
The minimum is S$1,000, in multiples of S$1,000. Each person can put in up to S$1 million in non-competitive bids per auction, and all of one person's bids are capped at 15% of the issue.
You cannot redeem it early with MAS. You can sell it on the secondary market through DBS, OCBC or UOB at their branches, at the market price on the day, which can be more or less than you paid.
No. MAS says interest earned on Singapore Government Securities is tax exempt for individuals.
The full amount is taken when you apply. If your bid fails, the money is refunded 1 to 2 business days after the auction. If it succeeds, the discount is credited 1 to 3 business days after the auction.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).