Just For Thinking ...
Createwealth8888: Before any newbies putting their CPF OA 2.5% almost risk free return at risks and thinking "long-term" investing will generate positive return. See the truth for yourself. It is best to leave your CPF OA investment fund alone until you can prove that you can consistently generate more than 2.5% return from your cash fund.
SINGAPORE: About 45 per cent of CPF
members who used their Ordinary Account savings to make investments from 1
October 2010 to 30 September 2011 suffered losses.
In his written reply to parliament on Monday, Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said the investment performance could have been adversely influenced by the volatility and overall decline of equity markets during this period.
Non-Constituency MP Lina Chiam had earlier asked how many of these losses were due to investments in high risk assets.
Mr Tharman explained the CPFIS provides members who are prepared to accept higher investment risks with the option of investing in potentially higher-yielding returns.
The risks lie in the performance of the funds or investment instruments that they choose, or in the broader investment climate.
The timing of CPF members' transactions can accentuate this risk.
The Finance Minister therefore advises members to exercise care and prudence when investing under the CPFIS.
Members who participate in the CPFIS should ensure they are equipped with the necessary investment knowledge, and be prepared to accept the risk of their investment choices.
If members are not confident of investing on their own or do not wish to risk capital losses on their CPF savings, they can continue keeping their money in their CPF accounts and earn the risk-free interest.
The Special, Medisave, and Retirement Account (SMRA) interest rates, in particular, are equal to the yield of the 10-year Singapore Government Securities (SGS) plus one per cent, which proxies for the yield of a long-term, 30Y SGS bond.
Members will also earn one per cent extra interest on the first S$60,000 of CPF balances.
As of the end of last year, about 900,000 CPF members, or 27 per cent of all CPF members maintained investments that were purchased using their CPF Ordinary Account (OA) savings.
About 470,000 CPF members, or 14 per cent of all CPF members, maintain investments that were purchased using their CPF savings from their Special Account (SA).
These proportions have remained roughly constant over the past five years.
- CNA/fa
In his written reply to parliament on Monday, Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said the investment performance could have been adversely influenced by the volatility and overall decline of equity markets during this period.
Non-Constituency MP Lina Chiam had earlier asked how many of these losses were due to investments in high risk assets.
Mr Tharman explained the CPFIS provides members who are prepared to accept higher investment risks with the option of investing in potentially higher-yielding returns.
The risks lie in the performance of the funds or investment instruments that they choose, or in the broader investment climate.
The timing of CPF members' transactions can accentuate this risk.
The Finance Minister therefore advises members to exercise care and prudence when investing under the CPFIS.
Members who participate in the CPFIS should ensure they are equipped with the necessary investment knowledge, and be prepared to accept the risk of their investment choices.
If members are not confident of investing on their own or do not wish to risk capital losses on their CPF savings, they can continue keeping their money in their CPF accounts and earn the risk-free interest.
The Special, Medisave, and Retirement Account (SMRA) interest rates, in particular, are equal to the yield of the 10-year Singapore Government Securities (SGS) plus one per cent, which proxies for the yield of a long-term, 30Y SGS bond.
Members will also earn one per cent extra interest on the first S$60,000 of CPF balances.
As of the end of last year, about 900,000 CPF members, or 27 per cent of all CPF members maintained investments that were purchased using their CPF Ordinary Account (OA) savings.
About 470,000 CPF members, or 14 per cent of all CPF members, maintain investments that were purchased using their CPF savings from their Special Account (SA).
These proportions have remained roughly constant over the past five years.
- CNA/fa
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Hi CreateWealth8888, I think 45% is still a good number. Sorry about the losses but there are still 55% who managed to win.
ReplyDeleteYes! There is improvement compare to when CPFIS just started.
ReplyDelete