Hyflux - where we stand

I think at this point of time, it would be good to know how much vested interest there is among the key stakeholders in Hyflux to help the preference shareholders ( N2H), perpetual shareholders (BTWZ)  and the ordinary shareholders (600).

It would also be good to know as a really rough gauge, how many people are affected. I should make it clear that this number is just a very rough ball park figure because some of the securities( N2H, BTWZ, 600) are held in nominee accounts which can hold for many different shareholders, information is based on public available information updated sometime ago, people buy and sell and rounding off errors.

Amount of money at risk for Hyflux directors

The following is the amount of money at risk for the directors. This information is taken from the annual report of 2017.

Number of affected shareholders

Based on the 2017 annual report, there are 20,104 (N2H) holders.
Based on the IPO allocation table, there are 23,868 (BTWZ) holders.
I am unable to find info the number of 600 holders.

N2H holders

BTWZ holders

Further reading :
1) Considerations about Hyflux
2) The fate of Hyflux

About rental car excess insurance - Apex vs Jucy - New Zealand holiday

Rental car insurance is a rip-off. Be careful of excess insurance reduction from rental car companies as the list of exclusions are difficult to interpret OR easily manipulated to fit into their definitions.

We have narrowed down 2 rental car companies that gives real value for money in New Zealand.
Apex car rental and Jucy. These are considered 2nd tier rental companies. 1st tier ones would be Hertz, Avis e.t.c who generally uses very new cars with little mileage but the prices are easily 20-40% more expensive.

Apex and Jucy prices their cars  roughly the same but here is why Apex beats Jucy hands down.

Roof damages

Apex Car Rental (top)

Jucy (bottom)

For full excess reduction insurance, it cost $20 per day for both companies. Apex will cover any roof damages, period. ( standard tncs apply). However, for Jucy, it doesn't cover any roof damages regardless of any circumstance . This was quite shocking to me as Jucy further elaborated that hail and falling of a tree branch, both being quite possible and through no fault by the driver, is not covered.

Claim Administration fee

Jucy also charges NZD 75 bucks per claim, irregardless of having full excess reduction insurance or not, or whether one is at fault or not, while Apex doesn't have such a fee. This fee by Jucy feels very ridiculous to me.

Authorised driver

Apex allows one to add authorised drivers for free while Jucy charges $2 per day, per additional driver. While this cost is not a deal breaker ,do note that the rental insurance is only valid if the driver was added.

Toll and infringement administration fee

Jucy charges NZD$60 for each toll/infringement claim incurred but Apex charges NZD$10 for each toll claim and NZD$25 for each infringement claim.

Opening an Australian bank account by a Singaporean

I have been getting some queries on my post on opening an Australian bank account. I guess the reason is because the aussie dollars have reached parity with the Sgd lately and people are becoming more interested.

I have kept my Australian account for about 2 years 5 months just purely for holidaying and have not been taxed a single cent on my interest income. I will summarise the way to avoid taxes legally or at least minimise the tax incurred.

1)  Put a non-Australian address ( a.k.a put your Singapore address)

If you put an australian address, maybe because you have an investment property there, the Australian Tax Office (ATO) will deem you a resident and tax your interest. As you are not working there, you have no tax file number ( TFN) and so will leave this field as blank. That's spells disaster!

The bank will, by default, charge you the highest tax of 46.5% on your interest earned.

By putting a Singapore address, your interest income is subjected to 10% tax.

2) Keep the total annual interest income lower than $120

With my National Australia Bank (NAB) earning about 2.5% pa annually, my full interest income will be taxed once the deposits reaches about $4800 ( interest is compounded monthly since interest is credited monthly so the threshold is actually slightly less than $4800) . 

Now, knowing this, i would open in my wife, father, mother, sister, helper, mother-in-law, father-in-law name, friend name, so that i have many accounts to squirrel into to be below the threshold. BUT, one need to be there in person to open. Haha... no free lunch!

3) Open the account in your children's name

The annual interest income threshold for a child is $420, which is deposits less than $16,800 ( the threshold is lower based on the reason i cited above). They still have to be there in person to open.

Anyway, i will gladly pay the 10% anyway if i were to invest in Aussie dollars while waiting for the commodities super cycle since, i will still be getting 2.25% pa NETT interest without the many hoops i have to jump across of local banks and the caps that each have. (UOB one, DBS multiplier, BOC smartsaver, Citibank Maxigain, SCB bonus saver).

Are you Return-focused OR Return on Risk Focused?

Taking the opportunity to sell into strength! Please go higher and higher!

Which would you rather pick? The bigger apple may not be better - Nasdaq.com

My thoughts about the Singapore property market

Everywhere i turn, i can't escape from someone getting a windfall from their enbloc sale. My parents, my secondary school friend, my client, my cousin and the newspapers. And i didn't. Horror of horrors!
The following are taken from SRX.
_________________________________________________________________________________

Private property ( non landed) Sale - above and Rental- below index
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HDB Sale- above and Rental-below Index

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1) For private property, the price is increasing but the rental is decreasing. Coupled with increasing interest rates, i wonder what is the fuel that will sustain the price increases? Euphoria borne from the spate of enbloc sales? 

2) HDB is following a more logical path, price goes down and rental also go down. And not all HDB dwellers are with a bank loan as they can take HDB loan. Such will be immune to interest rate rises going forward.

3) If HDB rental continues to fall, where is the "floor" to support private property rental rates?

4) I can see on hindsight how property prices continued its appreciation till 2013 as property price increases are coupled with rental increases. ( not to mention low ir). 

About Bitcoins, Ethereum and other Altcoins

I feel like i am living in a tulip mania. Admittedly, i am not technologically inclined or maybe i am not as open-minded as i think i am. And it is very very difficult to tell what is real in this time and age. I feel more alone as i get older.

"Human action can be modified to some extent, but human nature cannot be changed. "- Abraham Lincoln.

I want to believe in digital currency but i can't seem to find the answers. People who have spoken to me have been mixing up Block Chain with Bitcoins, Ethereum, Litecoins or other Altcoins and showing me articles about major banks and MAS sanctioning trials on Block Chain instead.

Some questions that needs to be answered.
1) The advantage of digital currency is decentralised, so no one can control it.
But what happens when the digital currency vanishes, who do we turn to or is there insurance like SDIC 50k in singapore? Which country law to apply?
And it seems that it can be controlled or at least corrupted if a group takes over more than 51% of the mining power based on this link
https://www.coindesk.com/bitcoin-miners-ditch-ghash-io-pool-51-attack/

2)The advantage of digitial currency is its limited supply, with Bitcoin purportedly capping the supply at 21 million coins. Miners , earn digital currency by verifying the transactions, so what happens when 21 million coins is reached? No more miners, mean nobody willing to verify anymore since there is electricity bills involved?
I think they will increase the cap when this is reached but then again, it contradicts its original aim which is to stop the disadvantage of money printing by governements.

3)Internet says it saves transaction cost compared with traditional credit card fees or wire fees. But when i see i want to convert into bitcoin or trade, the fees damn high like 5-6% for ATM conversion or 3.99% for some transactions. Is this a marketing lie about the fees involved?

4) Is it impossible to hack these kind of thing to steal? I understand that the information is stored in millions of computers so one cannot change one ledger without no one knowing since it wont tally with the others millions of computers ledger based on BlockChain technology. With a virus that can affect millions of computers at one go like wannacry or God knows what, is this really unhackable? At least for a centralised source, the company or bank can spent billions for security but for millions of computers who many dont or use low grade security, is it really safer?

5) The software is also open source, meaning that anyone can look at it to make sure that it does what it is supposed to. It seems like there is transparency especially with all the negativity about secrecy agendas of the government so it appeals to the masses , BUT shouldnt open source be easier to hack and who has MORE motivation to check the codes, a person who wants to profit OR a person who is civic minded ?

Some Corporate Bonds and their Yield to Maturity

To me, investing in corporate bonds is easier than investing in equities, because all one needs to care about is not whether the company makes more and more money in the future, but whether the company can make enough money to survive the holding period of the bond. 

However, needing to fork out generally $250k a unit ( except retail ones) adds to the risk. Given that there is little capital appreciation, the greediness to leverage looms large. I really need to give myself a slap in the face if i ever think about it and thank God, i have not levered ...yet.

The fall of Swiber, Marco Polo, krisenergy is a lesson for bondholders. Other than just simply looking at pure numbers, it is imperative to know what kind of assets a company holds. A company holding computers as assets does not give one peace of mind. 

Perpertual securities and preference shares are a very tricky lot and they must be adjusted for by deducting them from equity and adding to liability in the balance sheet.
From the table, generally, the higher the liabilities/equity, the greater the yield to maturity (ytm). The further the maturity of the bond, the greater the yield to maturity.
Heeton seems very "value" from the perspective of it having a lower liabilities/equity than Tuan Sing, Oxley and Aspial but commanding a higher ytm.
(ytm taken from bondsupermart. liabilities/equity taken from financial statements.)

Committing Financial Harakiri and the ICBC Travel Mastercard

I will be going overseas to splurge on luxury watches (looking for Pateks and Audemars Piguet) hence committing financial harakiri. Sweat.... Actually, its a gift to people special so damn it, better make it bang for the buck. Save on the taxes. I can't possibly be carrying more than ten thousands of cash overseas. Fortunately, a special shoutout to a forumner called BBCwatcher who alerted the public on the ICBC Travel Mastercard. No link nor picture, as i am not advertising for them nor paid by them.

My motive of this post is for constructive feedback in case i did my calculations improperly or for any alerts if there is a better card out there for overseas foreign transaction because every cent counts.

The ICBC Travel Mastercard has a bank fee of 2.5% and an unlimited cashback of 3% on foreign transactions.

I used the following 2 websites.
1) The official Mastercard website that lists the indicative forex rates. We can input the bank fee which i inputted as 2.5%.
2) A money exchange website that lists the exchange rates that one can find in Singapore ( i am not being paid so no link).

Official Mastercard Website

Money exchange website

Nett cashbacks for transactions in stated currencies after bank fees 

(done on 25/10/2018 11.10am)

YEN = 0.41%

USD = 0.53%

AUD = 0.22%

MYR = 0.43%

NZD = 0.74%

EUR = 0.46%

KRW = 1.4%

The KRW and NZD are aberrations. I will need to observe them again as what Mastercard does is to convert foreign currencies to USD before converting to SGD. Since all foreign currencies have to be converted to USD first before being converted to SGD, it is unlikely that the nett cashback on any foreign currency to be higher than the nett cashback on USD. Perhaps the money exchange website isn't showing correctly for these rates.