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Regular readers might remember that AK didn't sound too interested in 6 months T-bills anymore in a recent blog.
Why?
Simply put, the yield was falling and promotional fixed deposit interest rates from the banks were equally attractive or getting more attractive for a 6 months tenor.
Too lazy to go into details again here and some might be offended if I do.
So, for those who don't remember or would like to refresh their memory, see:
SSB, T-bill, "Fed up."
Still, I was expecting at least a smelly smelly 3.8% p.a.
That would not be very attractive but it would still make sense for people trying to get a higher return with their CPF OA money.
Although I was not very interested, at the back of my mind, I was wondering if I should try my luck?
After all, it is an auction and I could be wrong and I said so in the blog.
However, what piqued my interest was a reader's comment in the said blog.
Keng speculated that some people might play hard to get and push up the yield.
I found his comment interesting and I even made a YouTube video out of it:
Anyway, I put in a $10,000 non-competitive bid just to tikam.
Well, the rest is history.
 |
| Source: MAS |
4.4% cut-off yield!
This is the highest ever since I started my T-bill adventure in October!
100% allotted too!
Alamak!
Should have put in a larger sum.
LOL.
Imagine betting on 4D and getting the first prize when we betted only $1.
Yes, similar feeling.
LOL.
It is like a box of chocolates.
We don't know what we might get.
Auctions are like this.
So, did sanity return to the T-bill auction?
Or was it simply a case of herd mentality?
Quite possibly, like me, many were expecting the yield to be lower.
So, quite possibly, many who participated before did not participate in this auction.
Now, with this "earth shattering" 4.4% p.a. yield, could we see an increased interest in the next auction this month?
I could hazard a guess but I think I will not.
Too hazardous.
LOL.
Huat ah!
Related post:
4% p.a. 6 months FD promo.
Recently published:
Buy crypto in 2023. Jialat.
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10 comments:
Wow congrats AK!
I didn't participate in the T-bills application due to lack of funds, but glad to know you got full allocation :)
Hope the banks continue to up their game and draw the crowds away from T-bills :P
Applied this round a higher-than-yours amount with a bid of 3.8% which was what many have anticipated. Was I surprised by the cut-off yield 😆
Hi AK,
I applied as competitive at 4%. I got back the discount and calculated it as 4.4%...
Any idea why?
Hi keng,
Thanks for giving me a little nudge. ;p
I certainly hope promotional interest rates on fixed deposits continue to go up.
Good to see that cash is being treated with respect again instead of the "cash is trash" phrase which I got so tired of hearing. :)
Hi Sandra,
Good to know that AK wasn't the only one who was pleasantly surprised (i.e. wrong.) ;p
I suppose it was only reasonable to expect a lower yield given recent indications from Mr. Market.
Anyway, congratulations! :D
Hi Rellangis,
Unless your competitive bid is higher than the cut-off yield, you will be given the cut-off yield no matter how low your bid was.
I made a YouTube video on this matter:
T-bill cut-off yield.
Gong xi gong xi. :D
Next round, all in
Hi SgFire,
Huat ah! :D
Hi
I didn't "tikam" this round, with funds allocated elsewhere. Hmm, the competition will probably heat up again for the next lot, as people go hunting for high rates.
Hi Yv,
The fact that I tried my luck with only $10,000 tells you how little confidence I had that the yield could be higher and definitely not as high at 4.4% p.a.
I said to myself that if the yield was lower, at least only $10,000 would be trapped for 6 months. ;p
I don't know what to expect with T-bills' yields anymore.
Very perverse. ;p
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