Dear ,

The stock market has experienced significant volatility recently, and economists are anticipating a slowdown in global growth.

At the same time, interest rates are trending downward. For example, the cut-off yield for the 6-month T-bill dropped to 2.75% p.a. in the 27 February auction, down from 2.90% in the 13 February auction.

While these rates are still relatively attractive, the trend (Diagram 1) suggests that interest rates are gradually declining as Singapore’s inflation moderates.

Diagram 1

In this environment, it may be a good time to consider locking in higher interest rates for the longer term.

If you’re looking to avoid the uncertainty and volatility of the stock market, bonds could be an excellent alternative to earn higher interest and generate potential passive income.

I’m not referring to Singapore Savings Bonds (SSBs), which are government-backed savings vehicles that can be traded on the secondary market. Instead, I’m talking about corporate bonds.

Currently, U.S. 2- and 5-year Treasury bills are offering yields above 4% p.a., allowing you to lock in these rates for the next 2 to 5 years, depending on your investment horizon. Corporate bonds, in particular, often provide even higher interest rates than government T-bills to remain competitive.

If this aligns with your financial goals, I’d like to share a potential solution: a fund that offers a yield of ~4.428% p.a., paid monthly. This could be a useful option to secure a stable and attractive return in today’s market.

I’m sharing this as a potential option that might be relevant to you, given the current economic climate.

If you’d like to explore this further or discuss how it could fit into your portfolio, feel free to reach out.

Otherwise, I’m always here to help with any questions or concerns you may have.

Wishing you continued success in your financial journey!

Best regards,

Zest Chia

Executive Wealth Consultant | Associate Estate Planning Practitioner |

Licensed General Insurance Advisory

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