I started serious Investing Journey in Jan 2000 to create wealth through long-term investing and short-term trading; but as from April 2013 my Journey in Investing has changed to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

Since 2017 after retiring from full-time job as employee; I am moving towards Investing Nirvana - Freehold Investment Income for Life investing strategy where 100% of investment income from portfolio investment is cashed out to support household expenses i.e. not a single cent of re-investing!

It is 57% (2017 to Aug 2022) to the Land of Investing Nirvana - Freehold Income for Life!

Click to email CW8888 or Email ID : jacobng1@gmail.com

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This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

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Friday, 3 December 2021

Don't Laugh At Precision Two Decimal Points Investment Returns!

Hmm .. you too laugh at precision two decimal points investment return?

Bank loan interests for Dec 21 still maintained at 1.04929%. Five decimal points!

Yeap. When banks collect those five decimal points loan interests from massive customers. It will add up to big round down number!

Same same for precision two decimal points investment returns! Over two to three decades of two decimal points. It can also add to mid or high single digit! :-)


  1. Well, Uncle8888, you got something in common with buy-and-forget index fund investors lol!

    They also very interested in 2 or 3 decimal points ... 0.01% difference in expense ratio is A LOT for them 😂

  2. CW,

    Most banks only use decimal up to 2 places. DBS is one that I know use up "precision" up to 3 decimal places for home loans, and that's already quite "malu"...

    Come, tell us the bank that uses "precision" up till FIVE decimal places so I can have a laugh too!

    You know what? From a landowner perspective, wouldn't I earn more when I can round up the bank loan interest up and charge my customers 1.05%?

    So its the REVERSED.

    That bank that uses 5 decimal places is giving margin away due to competitive pressures...

    If I'm an investor, I would rather invest in the bank that have pricing power to charge 1.05% in 2 decimal places over the one that charges 1.04929% ;)

    You think why Apple so powerful and cash rich?

    Have you seen Apple price its products with precision up to 2 decimal places?

    That 2 decimal places trick is often used by supermarkets - instead of selling $2 dollars, sell $1.95 ;)

    Evidently there are customers who are "turned-on" with a savings of 5 cents!!!

    As for investment returns, if we have to add two decimal places returns over decades to come to ONE extra percentage... We are either "try-hard" or very "calculative"...

    I would think for most people, if its investment returns over DECADES, the first thing we'll ask is how many multiples or baggers will our portfolios become?


  3. Not correct that only DBS uses "5 decimal places interest rate" for their loans. SIBOR/SOR are in 5 decimal places, hence, all banks that peg their floating rate loans (home & others) to SIBOR/SOR also technically use 5 decimal places, i.e., 1 month SIBOR + spread (say 0.75%). Appears there is a slight improvement for the future SORA (in 4 decimal places?). Of course, for fixed rate loans, banks normally stop at 2 decimal places.

    Forex trades are even more "precise", up to 6 decimal places are used! For sizeable quantum, the no. of decimal places does matter

    1. SMOL got chance to laugh louder at Forex trades. LOL!

    2. CW and retiree5559,

      Stop. You guys are too funny!

      Investor A's investment return is 1.049%. Investor B flexes by saying his return is 1.04929% for the win!

      Then Saver C blur blur comes along with his 4% CPF interest returns... Investor A and B looked at each other red-faced.

      We are still talking about investment returns right?

      How did the conversation went all the way to forex???

      Distract and switch subject?


      1) CW,

      I know you and I can joke. So no harm no foul here ;)

      For forex, if you exchange in hundreds of million Sing dollars, of course its in our interest to use 6 decimal places ;)

      If just change a few hundred Sing dollars to visit JB, you try at the Money Changer lor! See if the Money Changer would laugh his head off if you try using 6 decimal places!

      2) retire5559,

      Not sure whether you can joke, but here's my "Trust but Verify" poke:

      DBS SORA ratese

      Like I've said, 3 decimal places is already quite "malu" ;)

      Of course in practice its 5 decimal places. But why only show 3 decimal places on website then?

      Gee... I wonder why for fixed rate loans, banks just stop at 2 decimal places?

      I just know one thing. Let's hope CPF sticks with 1 decimal place. I don't think its to our advantage if one day big daddy decides to use 2 decimal places for our CPF interest rates!

  4. Well, the bigger the principal amount the bigger the scaling effect of the formula.
    I usually goes for 4 decimal points for my own formula in counting my returns. Every penny counts!!!! LOL.

  5. With headline inflation at >3%, I think people more interested in the numbers to the LEFT of the decimal point for their salary increment, bonuses & investment returns! 🤣

    Even if counting cents, round to 2 decimal places can liao.

    Reminds me of my grandpa's stash of old coins ... 1940s 1/2 cent Straits Settlements & British Borneo coins, and 1930s 1/2 penny British coins ... and get this British FARThing coins 😂 No, they're not smelly ... a farthing is 1/4 penny.

    I guess those days money was pretty big lol.

    PS: In the olden pre-decimal days, 1 pound = 240 pennies & 1 shilling = 12 pennies. 1 pound could pay for a family's weekly groceries.


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