The economy had been so bad that recently Singapore banks now only gives 0.125%pa on normal savings account instead of previous 0.25%pa. That is a 50% cut as if deposit interest rates were not already pathetic enough.
If I have $6000 cash in my savings account, I would only earn $7.50 for a year. If I were to put in fixed deposits at current rate of 0.55%pa, I would earn $33 a year.
I'm going to talk about the card by Standard Chartered Bank, the Manhattan Platinum card. The good thing about this card is that it is giving 5% cash rebates for spendings from $3001 onwards, capped at $300.
Consider if I have $500 bills to pay per month, it will cost $6000 a year. Should I pay per month as usual, or should I pay in one short?
The answer is pay in one short $6000. I would swipe my Manhattan card one short to pay off the whole year of $500 bill per month, which amounts to exactly $6000 per year. Reason is simple, Manhatttan card gives me $300 cash rebates which is much more than the interest of $6000 in the bank savings account that can ever generate for me.
Many people keep a lot of money in savings account. So for the portion of $6000, do you want to earn $7.50 from it, or earn $300 from it?
This illustration that I had shown here is absolutely risk-free. Of course $6000 can be higher yielding than 5%pa if you put in investments, but there are risks.
Start charging your utility bills, telephone bills, internet bills, insurance premiums yearly with this Manhattan card before the 5% rebate promotion ends. Also if you are buying big ticket items like LCD TV and furniture, do not opt for interest free monthly instalment schemes.
If you are usually hard-up, having monthly negative cashflow, or you wouldn't have $6000 to spare in your savings account, all the above does not apply to you.
Sunday, May 3, 2009
Monday, April 20, 2009
My dual currency trade
Not sure if I was lucky or unlucky, my NZD was converted to USD at the rate of 0.539 thanks to the recent upsurge. According to my technical analysis, the rise of NZD/USD has been inconsistent with its underlying trend, ie giving a negative divergence. Improving risk appetite had been a main driver of kiwi's recent rally, but the correlation had faded in the past week.
Looking at NZD, basically economic growth had remained slow in the NZ as the current global downturn has dried up demand for its exports. The manufacturing sector decline for a 11th straight month which could lead companies to start shedding workers. The labour market has remained resilient adding workers over the past three quarters. Yet, if domestic growth falters in conjunction with exports then the country’s downturn could accelerate. The recent OECD report painted a sour picture as it forecasted that “a deep and protracted recession, involving a housing market correction and deleveraging of household and business balance sheets, is unlikely to be avoided”. The country’s high debt levels and credit rating risk make monetary policy tricky for the RBNZ, but markets are expecting another 25-50 bps cut at their June policy meeting.
As I'm typing, NZD is dropping back to the levels one month ago when I sold the currency option. On the current bull run on equities, my view is agreeable to the "bear-market rally" Blue chips started to rise to overbought levels and in the recent week, penny stocks saw a substantial rise in their prices. This worries me as I have learnt painful lessons that once pennies start to rise, it means that aunties and uncles started to flood the market. True enough, I have increasing inquiries by aunties and uncles come asking about how to buy shares, talking about market bottoming and economy recovery. Some even wanted to put EUR fixed deposit. To me, it is still a traders' market and real investors are still sitting by the edge watching on. Furthermore, in the forex market NZD and AUD has started to react downwards, which I intuitively see as early signs of a imminent correction of the equity market.
However, I do see a potential in AUD although it has risen by a fair bit. But it is this fair bit that confirmed the uptrend or consolidation mode. My next trade would probably pair with the AUD. Looking at current price, the AUD definitely has room for some retracement. AUD is a commodity currency. As long as there is demand for commodities, AUD will survive, and China has been the main buyer. My personal view is that AUD has bottomed and it is consolidating between 0.60 and 0.75 against the greenback now. It is trying to form an uptrend and once the trend is confirmed, there is no turning back.
Looking at NZD, basically economic growth had remained slow in the NZ as the current global downturn has dried up demand for its exports. The manufacturing sector decline for a 11th straight month which could lead companies to start shedding workers. The labour market has remained resilient adding workers over the past three quarters. Yet, if domestic growth falters in conjunction with exports then the country’s downturn could accelerate. The recent OECD report painted a sour picture as it forecasted that “a deep and protracted recession, involving a housing market correction and deleveraging of household and business balance sheets, is unlikely to be avoided”. The country’s high debt levels and credit rating risk make monetary policy tricky for the RBNZ, but markets are expecting another 25-50 bps cut at their June policy meeting.
As I'm typing, NZD is dropping back to the levels one month ago when I sold the currency option. On the current bull run on equities, my view is agreeable to the "bear-market rally" Blue chips started to rise to overbought levels and in the recent week, penny stocks saw a substantial rise in their prices. This worries me as I have learnt painful lessons that once pennies start to rise, it means that aunties and uncles started to flood the market. True enough, I have increasing inquiries by aunties and uncles come asking about how to buy shares, talking about market bottoming and economy recovery. Some even wanted to put EUR fixed deposit. To me, it is still a traders' market and real investors are still sitting by the edge watching on. Furthermore, in the forex market NZD and AUD has started to react downwards, which I intuitively see as early signs of a imminent correction of the equity market.
However, I do see a potential in AUD although it has risen by a fair bit. But it is this fair bit that confirmed the uptrend or consolidation mode. My next trade would probably pair with the AUD. Looking at current price, the AUD definitely has room for some retracement. AUD is a commodity currency. As long as there is demand for commodities, AUD will survive, and China has been the main buyer. My personal view is that AUD has bottomed and it is consolidating between 0.60 and 0.75 against the greenback now. It is trying to form an uptrend and once the trend is confirmed, there is no turning back.
Saturday, January 10, 2009
Interest-free Cash loan for 30 days
While funding for my stock purchases after T+3 recently, I discovered I can pay through my credit card. It is not considered as a cash advance, but as a "swipe" card process that is equivalent to swiping your card in restaurants or retail malls.
The only bank in Singapore that allows you to do this is DBS/POSB. You go to internet banking and go to Bill Payment. As my stock broking firm is Phillips, I add a new biller Phillips, my account number is 20(broker code)(6-digit login). For eg, 20XR123456. After I do this, the amount will go into my Phillip Cash Management Account. This cash management account is your account for debiting/crediting when you buy share or sell share respectively.
The trick here is that I have tried 2 times using this bill payment method to pay for my stock purchases. As playing contra for stocks is usually T+3 to T+5, I can now extend the contra period to 1 month simply because I only need to pay back the amount 1 month later when the credit card bill comes.
If you are not buying shares, you do the same thing "swipe" the card to pay to your Phillip cash management account. Afterwhich, you can log on to phillips online and transfer the money in your account back to your POSB savings account. In this case you are actually borrowing the money free of charge. But remember to pay back when the bill comes.
Facilities required:
1) Phillips online trading account aka POEMS (no initial deposit needed for opening)
2) DBS/POSB credit card
3) POSB internet banking
Limitations: Amount you can take is limited to your credit limit which is 2 times of your monthly salary. And you have to repay in full when the bill comes, else normal credit card interest charges apply.
Additional benefit: If you can't repay in 30 days or lesser when the credit bill comes, you can do a balance transfer to other banks at 0% interest pa, but with one-time processing fee of about 6% or lesser. But afterall, this is still cheap cash loan compared to Cash Advance at 24%pa
The only bank in Singapore that allows you to do this is DBS/POSB. You go to internet banking and go to Bill Payment. As my stock broking firm is Phillips, I add a new biller Phillips, my account number is 20
The trick here is that I have tried 2 times using this bill payment method to pay for my stock purchases. As playing contra for stocks is usually T+3 to T+5, I can now extend the contra period to 1 month simply because I only need to pay back the amount 1 month later when the credit card bill comes.
If you are not buying shares, you do the same thing "swipe" the card to pay to your Phillip cash management account. Afterwhich, you can log on to phillips online and transfer the money in your account back to your POSB savings account. In this case you are actually borrowing the money free of charge. But remember to pay back when the bill comes.
Facilities required:
1) Phillips online trading account aka POEMS (no initial deposit needed for opening)
2) DBS/POSB credit card
3) POSB internet banking
Limitations: Amount you can take is limited to your credit limit which is 2 times of your monthly salary. And you have to repay in full when the bill comes, else normal credit card interest charges apply.
Additional benefit: If you can't repay in 30 days or lesser when the credit bill comes, you can do a balance transfer to other banks at 0% interest pa, but with one-time processing fee of about 6% or lesser. But afterall, this is still cheap cash loan compared to Cash Advance at 24%pa
Monday, December 29, 2008
Online selling
Recently, I done a few good deals online. I'm not referring to online stock/forex trading. I'm referring to buying and selling physical things on the internet through online classified ads. During my few years of varsity days, I spent some free time buying and selling things online and I earn a steady income of about $500/mth in doing so. Before I forget about the techniques, I decide to document it down.
My recent sales include one in Nov 2008, I sold 11 mth old Nokia 6500 for $230. This is a good price because trade-in price was only $150. Handphone shops also selling 2nd hand sets around $250 or lower, not to mention that my phone has quite a bit of scratches and wear-offs.
In Dec 2008, I sold a brand new iPhone for $1150 when handphone shops are selling only $1160 or lower. Dealers taking in at $1000 or slightly higher only.
Here, I would like to pen down my own techniques of dealing online so far:
1) Knowing the market price.
Prior to selling, check out market prices through online classified sites like eBay or hardwarezone, etc. Get the price in mind.
2) Setting the selling price
Put up for sale at desired price +$50. For eg if your reserve price is $1000, sell at $1050. This is to let people feel happy because if you sell at $1050 and they offer $1000 and you accept it, they feel they got a bargain. All people likes bargains and getting unique advantages. Just like retail shops jerking up prices and then organising a sale to attract people.
3) Gain geographical advantage
I had always set dealing place or meet-up location to be somewhere near my house. For eg if you live in Bedok, set the meeting place at Bedok MRT. Do not ever accept dealing at faraway places to meet any potential buyer despite any high price. This is to prevent people from playing you out after you had travelled a far distance. To insist on dealing at your turf, you also make the seller more obligated to buy your item because he/she had spent some time and effort to specially travel to come and meet you.
4) Appearances
I always like to keep the boxes of the gadgets I bought just in case I need to sell it one day. If you had thrown away the box, try to pack it nicely, tie up wires nicely, or put in any box for better presentation. If you pack nicely, people are more ready to believe that the item was well-maintained and hence more willing to accept the item. Lastly, finish off with a decent paper bag. Let them feel proud of their purchase. Don't give NTUC plastic bags or other supermarket kind of plastic bags. Also, as a seller, dress neatly in presentable mode when you are meeting the potential buyer. There's a reason why most salesmen dress in suit and tie. You do not want to leave your hair uncombed and wear shabbily to meet the prospect buyer who offered a high price for your item. If you look neat, you gain more trust, hence easier to sell. PS I'm not saying that we should wear suit+tie, just dont wear crumpled clothes or home type of clothes.
5) Patience
Do not ever be too impatient to sell off your good. If no buyer contacts u, relist and update your online ad regularly to ensure sufficient viewership. Check your price again, make sure that you do not sell way off the market price. Add a tag "neg" behind the price if you need to (neg = negotiable). If you are selling an unpopular item, lower your reserve price, better than keeping it without using it and letting it depreciate. If you insist on selling your price, extend your viewership by posting at more websites and forums, just google "online classifieds" and many would appear. The bigger your net, the better your catch.
6) Handling bargaining/negotiation
Buyers always like to bargain for a lower price whenever possible. For eg if your reserve price is $1000 and you set selling price at $1050, you may get many offers at 900, 950, 980 etc. When you get a low offer like these, reply by saying you have an offer of $1000 already. If they do not reply with a higher offer, move on and never sms them again. Remember as a seller, you are unique and you must appear proud. Do not ever succumb to low offers. If someone else can sell $1000, there's always people buying at $1000 again. If someone offers $1000, sound proud by asking if he can deal at your set location. If he say ok, then arrange to meet. If he say can't meet at your location, just say sorry you only free to deal at your location. If he finally agrees, meet him, else just forget it and wait for the next offer. Sounding proud is also good because potential genuine buyer would sense that your item is really valuable hence u are proud. If you sound too happy and warm and readily accept their offer, they may either suspect their offer is too high, or your sale is a hoax, because where got so easy and smooth right? Look at some famous tasty char kuay kiao uncles, they have service attitude but people still queue to buy because they know good things are like that.
7) Miscellaneous
In sales you meet all kinds of people. Some will tell you they are willing to give you extra if you can meet them at their location. Do not be greedy. If things sound too good to be true, most likely it's not true. Once you set your price (point 2), stick to it. Make sure you have the geographical advantage (point 3), so that in case anyone plays you out, you do not lose much time and energy.
Avoid dealing with women, children and old men. Most failed cases belonged to these categories. No discrimination, but for the sake of explaining, women mostly don't know what they want and they see things based on feelings (especially young ladies below 25 yrs old). They are also more prone to last minute mood changes and stand you up. Children play a fool, last minute back out, asking stupid questions, etc. Old men are too fussy, observing too carefully and finding faults from their long-sighted glasses while trying to cut your price. The best crowd to deal with are men, from young adults to middle aged, especially engineers and people who deal with hardware. They are most candid and straightforward.
Last but not least, a few good sites that I use would include hardwarezone.com forums, phing.com, ebay.com.sg, etc.
My recent sales include one in Nov 2008, I sold 11 mth old Nokia 6500 for $230. This is a good price because trade-in price was only $150. Handphone shops also selling 2nd hand sets around $250 or lower, not to mention that my phone has quite a bit of scratches and wear-offs.
In Dec 2008, I sold a brand new iPhone for $1150 when handphone shops are selling only $1160 or lower. Dealers taking in at $1000 or slightly higher only.
Here, I would like to pen down my own techniques of dealing online so far:
1) Knowing the market price.
Prior to selling, check out market prices through online classified sites like eBay or hardwarezone, etc. Get the price in mind.
2) Setting the selling price
Put up for sale at desired price +$50. For eg if your reserve price is $1000, sell at $1050. This is to let people feel happy because if you sell at $1050 and they offer $1000 and you accept it, they feel they got a bargain. All people likes bargains and getting unique advantages. Just like retail shops jerking up prices and then organising a sale to attract people.
3) Gain geographical advantage
I had always set dealing place or meet-up location to be somewhere near my house. For eg if you live in Bedok, set the meeting place at Bedok MRT. Do not ever accept dealing at faraway places to meet any potential buyer despite any high price. This is to prevent people from playing you out after you had travelled a far distance. To insist on dealing at your turf, you also make the seller more obligated to buy your item because he/she had spent some time and effort to specially travel to come and meet you.
4) Appearances
I always like to keep the boxes of the gadgets I bought just in case I need to sell it one day. If you had thrown away the box, try to pack it nicely, tie up wires nicely, or put in any box for better presentation. If you pack nicely, people are more ready to believe that the item was well-maintained and hence more willing to accept the item. Lastly, finish off with a decent paper bag. Let them feel proud of their purchase. Don't give NTUC plastic bags or other supermarket kind of plastic bags. Also, as a seller, dress neatly in presentable mode when you are meeting the potential buyer. There's a reason why most salesmen dress in suit and tie. You do not want to leave your hair uncombed and wear shabbily to meet the prospect buyer who offered a high price for your item. If you look neat, you gain more trust, hence easier to sell. PS I'm not saying that we should wear suit+tie, just dont wear crumpled clothes or home type of clothes.
5) Patience
Do not ever be too impatient to sell off your good. If no buyer contacts u, relist and update your online ad regularly to ensure sufficient viewership. Check your price again, make sure that you do not sell way off the market price. Add a tag "neg" behind the price if you need to (neg = negotiable). If you are selling an unpopular item, lower your reserve price, better than keeping it without using it and letting it depreciate. If you insist on selling your price, extend your viewership by posting at more websites and forums, just google "online classifieds" and many would appear. The bigger your net, the better your catch.
6) Handling bargaining/negotiation
Buyers always like to bargain for a lower price whenever possible. For eg if your reserve price is $1000 and you set selling price at $1050, you may get many offers at 900, 950, 980 etc. When you get a low offer like these, reply by saying you have an offer of $1000 already. If they do not reply with a higher offer, move on and never sms them again. Remember as a seller, you are unique and you must appear proud. Do not ever succumb to low offers. If someone else can sell $1000, there's always people buying at $1000 again. If someone offers $1000, sound proud by asking if he can deal at your set location. If he say ok, then arrange to meet. If he say can't meet at your location, just say sorry you only free to deal at your location. If he finally agrees, meet him, else just forget it and wait for the next offer. Sounding proud is also good because potential genuine buyer would sense that your item is really valuable hence u are proud. If you sound too happy and warm and readily accept their offer, they may either suspect their offer is too high, or your sale is a hoax, because where got so easy and smooth right? Look at some famous tasty char kuay kiao uncles, they have service attitude but people still queue to buy because they know good things are like that.
7) Miscellaneous
In sales you meet all kinds of people. Some will tell you they are willing to give you extra if you can meet them at their location. Do not be greedy. If things sound too good to be true, most likely it's not true. Once you set your price (point 2), stick to it. Make sure you have the geographical advantage (point 3), so that in case anyone plays you out, you do not lose much time and energy.
Avoid dealing with women, children and old men. Most failed cases belonged to these categories. No discrimination, but for the sake of explaining, women mostly don't know what they want and they see things based on feelings (especially young ladies below 25 yrs old). They are also more prone to last minute mood changes and stand you up. Children play a fool, last minute back out, asking stupid questions, etc. Old men are too fussy, observing too carefully and finding faults from their long-sighted glasses while trying to cut your price. The best crowd to deal with are men, from young adults to middle aged, especially engineers and people who deal with hardware. They are most candid and straightforward.
Last but not least, a few good sites that I use would include hardwarezone.com forums, phing.com, ebay.com.sg, etc.
Friday, December 12, 2008
My dual currency trade
Last week fixing my trade remained in NZD, about 500 pips below my strike price. Today did a trade again, this time pairing with AUD, striking at 1.18, but the yield this time is very low, only 6.3%pa. Anyhow, I proceeded as nowadays the yields are much thinner compared to past few months. AUD/NZD is currently trading at about 1.202, so I'm striking at about 200 pips below the spot.
I'm trying to convert my whole sum from Kiwi to Aussie at the rate of 1.18 which lies onthe long term support trend line projection. The reason is because over these few months, I have observed that the Aussie is more resilient than the Kiwi in bad times, and perform better in good times. Looking at the graph of AUD/NZD in the long term, there is gennerally an uptrend though high short-term volatility.
Observing AUD/SGD and AUD/USD, I feel AUD is at consolidation mode, recently attempting to form an ascending triangle. At the current momentum, this could spell that AUD may break upwards anytime. On the other hand, NZD/SGD and NZD/USD is all the way a step-down ladder, failed double bottom formation and breaking new lows, which means that the Kiwi could still take quite a bit of time to recover, if happens.
I'm trying to convert my whole sum from Kiwi to Aussie at the rate of 1.18 which lies onthe long term support trend line projection. The reason is because over these few months, I have observed that the Aussie is more resilient than the Kiwi in bad times, and perform better in good times. Looking at the graph of AUD/NZD in the long term, there is gennerally an uptrend though high short-term volatility.
Observing AUD/SGD and AUD/USD, I feel AUD is at consolidation mode, recently attempting to form an ascending triangle. At the current momentum, this could spell that AUD may break upwards anytime. On the other hand, NZD/SGD and NZD/USD is all the way a step-down ladder, failed double bottom formation and breaking new lows, which means that the Kiwi could still take quite a bit of time to recover, if happens.
Wednesday, November 26, 2008
Maximising OCBC SmartChange $188
Update 18 Dec 08:
I have discovered paying for Starhub bill via Vpost.com.sg is even better. The minimum is only $2. I have a hell lot of transactions at $2.01. But be prepared for 'security' calls from OCBC and Vpost. I have received their concern calls, fearing that my card was stolen and misused. Anyway with $2.01, I will reach $188 target very fast.
--------------------------------
If you have not heard of OCBC SmartChange, visit http://www.ocbc.com.sg/personal-banking/smartchange/ to read it before proceeding to read below.
I have successfully applied for the OCBC Titanium card and tagged the smartchange account to it. To summarize, OCBC SmartChange gives you cashback of up to $188 in a quarter. If you spend $1.20, you get $0.80 extra. If you spend $1.80, you get $0.20 extra. The trick is to spend as little as possible. The best scenario is to spend $0.01, and you get $0.99
Of course using a credit card, it is almost impossible to spend $0.01. Most credit card merchants would probably accept credit card when your buy things that amount to at least $10 or $30. I can think of Watsons, Guardians, etc, where they accept your credit card to purchase a box of sweets costing like $1.10. Through this SmartChange system, we earn $0.90, which means my box of sweets costs only $0.20. Imagine I buy 1000 boxes of sweets, I earn $90. But the problem comes: how many times can you bring yourself to the cashier and let her swipe your OCBC credit card for a $1.10 item?
The next best item I can think of is paying your bills online by credit card. Things like your handphone, broadband, utility bills, you can pay them all online by credit cards by using sites like www.vpost.com.sg. I personally tried out paying my handphone bill to M1. I paid $5.01 to my bill because the minimum to pay online is $5. Using this method, I can earn $0.99 each time I pay $5.01 to my M1 bill.
A quick calculation to earn the full $188, is to charge many many $5.01 to your credit card. In other words, we need to pay $941.88 exactly worth of bills so that we can pay $5.01 for 188 times. (in case u're wondering, the math is 188 * 5.01 = 941.88) Since the rebate of $188 is paid over a quarter of 3 mths, which means each month average we need to have at least $313 worth of bills to pay for. If you do not have so much bills in a month, you may pay your monthly insurance premiums or other utility bills by OCBC credit card.
I have discovered paying for Starhub bill via Vpost.com.sg is even better. The minimum is only $2. I have a hell lot of transactions at $2.01. But be prepared for 'security' calls from OCBC and Vpost. I have received their concern calls, fearing that my card was stolen and misused. Anyway with $2.01, I will reach $188 target very fast.
--------------------------------
If you have not heard of OCBC SmartChange, visit http://www.ocbc.com.sg/personal-banking/smartchange/ to read it before proceeding to read below.
I have successfully applied for the OCBC Titanium card and tagged the smartchange account to it. To summarize, OCBC SmartChange gives you cashback of up to $188 in a quarter. If you spend $1.20, you get $0.80 extra. If you spend $1.80, you get $0.20 extra. The trick is to spend as little as possible. The best scenario is to spend $0.01, and you get $0.99
Of course using a credit card, it is almost impossible to spend $0.01. Most credit card merchants would probably accept credit card when your buy things that amount to at least $10 or $30. I can think of Watsons, Guardians, etc, where they accept your credit card to purchase a box of sweets costing like $1.10. Through this SmartChange system, we earn $0.90, which means my box of sweets costs only $0.20. Imagine I buy 1000 boxes of sweets, I earn $90. But the problem comes: how many times can you bring yourself to the cashier and let her swipe your OCBC credit card for a $1.10 item?
The next best item I can think of is paying your bills online by credit card. Things like your handphone, broadband, utility bills, you can pay them all online by credit cards by using sites like www.vpost.com.sg. I personally tried out paying my handphone bill to M1. I paid $5.01 to my bill because the minimum to pay online is $5. Using this method, I can earn $0.99 each time I pay $5.01 to my M1 bill.
A quick calculation to earn the full $188, is to charge many many $5.01 to your credit card. In other words, we need to pay $941.88 exactly worth of bills so that we can pay $5.01 for 188 times. (in case u're wondering, the math is 188 * 5.01 = 941.88) Since the rebate of $188 is paid over a quarter of 3 mths, which means each month average we need to have at least $313 worth of bills to pay for. If you do not have so much bills in a month, you may pay your monthly insurance premiums or other utility bills by OCBC credit card.
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