After I blogged about final month’s SSB which provided 3.16% p.a. 10 yr common yield, I stated I’d most likely be shopping for some.
And I did.
Only a modest sum of cash as I used to be “borrowing” the cash from 2025.
It was cash which I’d in any other case have earmarked for voluntary contribution to my CPF account in 2025.
2025 can be the yr I flip 54 years of age.
Now, I see this month’s SSB providing 3.32% p.a.
What am I doing?
I will probably be shopping for once more, I suppose.
Once more, it might be a modest sum of cash.
Though I’m sticking to my technique of rising the funding grade bond part of my funding portfolio, there would possibly not be a rush to lock in greater yields for the long term now.
I just lately produced two YouTube movies on the chance of rates of interest staying greater for longer.
That is the present day narrative and it appears to have gained traction.
That is most likely why the final T-bill public sale shocked us with a cut-off yield of 4.07% p.a. too.
A lot greater than many anticipated.
In case you have not watched the YouTube movies but, listed below are the hyperlinks:
1. This may very well be BAD! Why take a look at bond yields?
2. Motive why it may very well be rather a lot WORSE!
The yield curve remains to be very inverted with the shorter durations being extra rewarding.
So, strengthening my T-bill ladder can be extra rewarding.
Nonetheless, reinvestment threat exists with the T-bill ladder.
I inform myself to not complicate issues and easily persist with my plan.
1. Keep and strengthen T-bill ladder for an additional supply of recurring revenue.
2. T-bill ladder may be dismantled step by step to purchase shares throughout a recession.
3. Purchase SSBs with cash meant for VCs to the CPF so long as SSBs’ 10 yr common yield is greater than 3% p.a.
There is no such thing as a approach I’m going to make all the cash on this planet.
If AK can speak to himself, so are you able to!
