Friday, October 27, 2006

Return on Money Market Fund

The money market fund managed by NTUC Income offers a return that is linked to the money market.

The fund charges a very modest 0.25% p.a. to cover our expenses. The rest of the return is given to the investor.

The actual monthly return from the money market fund (net of charges) was:

 
31-May-06  0.31%
30-Jun-06  0.11%
31-Jul-06  0.23%
31-Aug-06  0.29%
30-Sep-06  0.20%


The average is 0.22% per month, or 2.7% per annum.

I have decided to transfer $100,000 from my bank (which earns about 1%) into the money market fund.
at

5 comments:

  1. blogsterOctober 27, 2006 8:36 PM

    Hi Mr Tan, are Flexi-Cash and Money Market Fund the same product offered by NTUC Income? I am considering investment in Flexi-Cash. Thks.

    ReplyDelete
  2. Tan Kin LianOctober 28, 2006 7:31 AM

    Flexi Cash and Money Market Fund are the same.

    We call the product Flexi Cash. It is invested in our Money Market fund.

    We will be having a special promotion sson. This will allow the upfront load of 0.25% to be waived. More details will be announced soon.

    ReplyDelete
  3. Magdeline TeoNovember 01, 2006 5:59 PM

    Hi Mr Tan,

    I am just curious about NTUC's Flexi-cash investment versus MayBank's iSavvy time deposit.

    I understand that with the latter, there is a minimum invested sum of $25k, whilst it's only $5k with Flexi-Cash.

    iSavvy returns between 3% to 3.15% (returns variou with different lock-in period).

    Say if I don't forsee an immediate use of my cash and have more than 25k to invest, would iSavvy suit me better?

    Also, when you have decided to invest your $100k into Flexi-Cash, have you too considered the merits of iSavvy? (being higher returns)

    Thanks for your comments.

    Magdeline Teo

    ReplyDelete
  4. Tan Kin LianNovember 02, 2006 7:58 AM

    Dear Magdalene Teo,

    The advantage of Flexi-cash is its flexibility. I can withdraw my money at any time, without any penalty. This allows me to invest in an equity fund at the right time, eg if the market has corrected.

    Another advantage is that the return is flexible. If the interest rate in the money market goes up, the return in flexi-cash will also go up. As interest rate is expected to increse, it will be to the advantage of the saver to be on "floating rate".

    For the small difference in return, compared to the "locked up deposit" from Maybank, I prefer to be in flexi-cash.

    ReplyDelete
  5. blogsterNovember 14, 2006 4:01 PM

    Hi Mr Tan

    You mentioned there will be a special promotion for Flexi-cash which allow the upfront load of 0.25% to be waived. However, there is still no news yet.

    Pls advise. Thks.

    ReplyDelete