Are you on the hunt for a safe, yet profitable short-term investment opportunity in Singapore? If so, the upcoming 6-month Singapore Treasury Bill (T-bill), slated for auction this 20 July 2023, might tickle your financial fancy. I’m here to dissect its potential yield and highlight the various ways you can capitalize on this golden opportunity.

A Brief Primer on T-Bill Auctions

For those new to the scene, T-bills are auctioned off by the Monetary Authority of Singapore (MAS). To take part in the auction and secure a successful subscription, you can place your order through Internet banking or visit in person. But hurry – orders must be placed by July 19!

If you’re still finding your bearings around T-bills, worry not! I’ve previously discussed the manifold benefits of these investment vehicles, their different applications, and how you can get your hands on them. You can check it out here: How to Buy Singapore 6-Month Treasury Bills (T-Bills) or 1-Year SGS Bonds.

Delving into Previous and Upcoming T-Bill Yields

Now, let’s talk numbers. The last T-bill issue saw a yield of 3.9%. However, the final cut-off yield landed higher at 3.99%. What does this mean for you? Well, if you choose a non-competitive bid, you could end up with a lower yield of 3.99%. To avoid this, it’s advisable to select a competitive bid, but keep your bid amount in mind.

A solid strategy is to bid at a yield that’s about half of the last cut-off yield. For instance, if the expected final yield hovers between 2% and 4.3%, a bid at 1.95% could increase your chances of securing your desired allocation.

Deciphering Indicators to Forecast the Upcoming T-Bill Yield

A clear way to anticipate the yield of the upcoming 6-month Singapore T-bill is to analyze the daily closing yield of existing T-bills. Currently, they’re trading at a yield of approximately 3.86%. Coupled with insights from the daily closing yield of the 12-week MAS Bill, we can infer that the upcoming T-bill yield will likely hover around 3.95%.

Factoring in Recent Market Trends

Recent market trends play a pivotal role in predicting T-bill yields. With US inflation data turning out better than expected, bond yields have undergone a correction. This shift suggests that the 6-month T-bill yield will likely stabilize around 3.95%.

Eyeing Other Investment Options

Interested in diversifying your portfolio? Singapore offers an array of investment options, from Fixed & Time Deposits on promotional rates to Short-term Insurance Endowments and Money-Market Funds. Each category comes with its unique range of returns, lock-in periods, and minimum investment amounts, enabling you to select the ones that best suit your financial goals and risk appetite.

That said, the returns aren’t set in stone and may vary based on prevailing short-term interest rates. As such, goal-based planning is crucial to ensure that you’re using the most suitable securities or instruments to achieve your financial objectives.

Creating Passive Income with Dividend Funds

Another promising investment strategy to consider is building a passive income stream through dividend funds. This approach has gained popularity among savvy investors due to its potential to provide regular income while offering a level of stability.

Dividend funds, as the name suggests, are investment funds that focus primarily on stocks that pay dividends. These dividends can either be re-invested to purchase additional shares of the fund, or can be paid out to the investor as a regular income stream. By investing in a diversified collection of dividend-paying stocks, these funds aim to provide both capital appreciation and regular dividend income.

Our strategy is to assist our clients in maximizing their investment potential. With our guided assistance, many of our clients are investing $50,000 per year in dividend funds. Assuming a conservative average yield of 6%, they’re projected to have a considerable amount accumulated by year 20.

Let’s do the math. If a client invests $50,000 each year for 10 years, that’s a total investment of $500,000. If this investment grows at an average rate of 6% per year, by the end of 20 years, it will have grown to approximately $1.74 million. This is not just a lump sum amount but an investment portfolio that can provide a steady, ongoing income. This is the power of compound interest at work.

This $1.74 million portfolio would help them earn a passive income of $104,000 every single year until they turn 99 years old.

Importantly, investing in dividend funds doesn’t require large lump sums to get started. It’s a strategy that can be tailored to your financial situation and goals. Whether you’re a seasoned investor or just getting started, creating passive income with dividend funds is a viable strategy.

By creating passive income streams, you can work towards financial freedom, where your investment income covers your living expenses. It’s about making your money work for you, so you don’t have to.

In Conclusion: A Close Watch on the Upcoming 6-Month Singapore T-Bill Yield

With all signs pointing to a yield of around 3.95%, the upcoming 6-month Singapore T-bill seems to be a promising short-term investment. However, as with any financial venture, always consider your financial goals and risk tolerance before diving in.

Keen on staying in the loop about the latest financial news and investment strategies? Subscribe to FMS Financial Insights for our weekly newsletter. And if you’re ready to embark on your journey towards creating passive income with dividend funds, book a call with Ben today!


Benjamin Low
Benjamin Low

Benjamin is known as The Passive Income Guy. He has helped hundreds of people to build passive income. He is also a member of the Million Dollar Round Table, and Certified Financial Planner™ (CFP®) and Certified Private Banker (CPB).

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