US Treasury Bills ETF
Recently, I have tested out US Treasury 20Y and 10Y ETFs. The dividend distribution is monthly. Unfortunately, there are 30% withholding. As I understood, there maybe tax refund later by brokerage counterparty. This to me is not a sure thing so i will continue to monitor. At the same time, I decided to sell away 10Y treasury bill stock. I realised is not needed for my situation. I am not sure what to do with the USD cash yet.
Currently, 20Y T-Bill gives 4.7%. In good times it can been as a market buffer during recession period. The only down side is the USD Currency and because it is ETF, there is no date limit where capital will be returned to me in full if I wait long enough. To work this strategy well, my allocation may need to be larger. At the same time to boost my total dividend income.
Banks
Decided to push for more allocation with fresh fund availability. I just surrendered my GE Policy (Endownment) and could allocate some to it. The Banks yield are tempting. I will need to further study the implication and robustness of my decision. To add a special note, I plan to add Critical illness so is not going without insurance.
There are some concerns by an influencer on recent DBS result. One of the key point is that Q4 result is weaker than Q3. If we look at previous year Q3/Q4 comparison, there is also similar pattern. So it doesn't look like a concern to me. Probably some banking cycle going on or fluctuation between quarters. However, the Q4 result is much lower than Q3. About 13%. I look for pattern swing in prior quarters and this does happen. So is not conclusive. Based on the 6 cent increase and the quarterly 15 cents capital return, this seem to indicate to me the management is not worried.
There is also another concern raised on rising cost/income hiting 40% if we look at each quarter trend. However, YOY comparison seems ok. Q4 is likely a period the bank give rewards to employees and the size likely much bigger than typical years due to the strong banking returns. So again is not conclusive. I will probably investigate further before adding more into banking stocks. Is something I am eager to do as this will address my dividend income shortfall and portfolio growth over time.
SG T-Bills
Increasing my allocation sizing laddar continuously. This is to further increase my buffer in case there is significant draw down at the bank side in which I plan to hold long term. I find SG T-bills much harder to track so is not displayed in my Equity allocation. Same for SSB not in Equity allocation too. Their update frequency is too much. However, I want to to show all their allocation and this probably best resides in Networth Asset allocation.
That's all folks.
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Disclaimer: The articles presented in this blog reflect personal opinions and are intended for informational and sharing purposes only. Not responsible of errors. Readers are advised to seek professional guidance when making financial decisions and should take full responsibility for their choices.
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