Starting from 1st July 2010, the first $40,000 of members’ Special Account balances will no longer be allowed to be used for investments.

There is no change to the requirement for members to set aside $20,000 in the Ordinary Account before they can invest their Ordinary Account monies.

If you have already bought investments under CPFIS-SA but do not have $40,000 in your SA, you will not be required to sell them. However, when you liquidate these investments, you would not be able to re-invest them unless you have at least $40,000 in your SA.

Singapore Exchange (SGX) said it expects to offer options on the S&P CNX Nifty Index (Nifty) and related products in the coming year.

Nifty is the leading index for large companies on the National Stock Exchange of India and contains 50 well diversified stocks accounting for 21 sectors of the economy.

This follows SGX’s obtaining of licensing rights from India Index Services & Products Limited (IISL) for the product range including derivative contracts on the CNX Nifty Junior, CNX 100 and CNX Midcap indices.

These new India-based products will provide market participants with increased trading opportunities and enhanced means for risk management. Since its launch in 2000, the SGX S&P CNX Nifty Futures has grown to be one of SGX’s key Asian equity derivatives products.

SGX also lists four exchange-traded funds (ETFs) linked to Indian equity indices on the securities market, namely the db x-trackers S&P CNX Nifty ETF, iShares MSCI India ETF, Lyxor India S&P CNX Nifty ETF and Lyxor MSCI India ETF with combined assets under management of US$782 million as at end-2009.

Came across an article about how some investors are making money by teaming up with a terminally ill person to buy corporate bonds.

How it works is that some major U.S. companies often issue bonds with what is known as a survivor’s option. This option allows the joint-owner of the bond to redeem it at face value should the other owner die.

As some of these corporate bonds were trading at a huge discount during the recent financial crisis, people have been scooping up some of these bonds to make a quick buck.

Read more here:

Investors Tap into Deathbed Bond Deal

The Housing & Development Board (HDB) recently unveiled policy changes designed to hurt speculators and make it more expensive for non-Singaporeans to buy government-subsidised flats. These changes include:

1) It will now be possible to apply for a second concessionary loan, even if you are downgrading. However, the quantum of the second concessionary loan will be reduced by the full CPF proceeds and part of the cash proceeds from the sale of the existing or immediate past HDB flats.
2) Minimum occupation period for resale of non-subsidised flats has been increased to 3 years.
3) Lease buyback scheme extended to those who previously owned 4-room and bigger flats.
4) In case of Singapore PRs who marry citizens, HDB will withhold $10k of the housing subsidy until the SPR takes up citizenship or they have a Singapore citizen child.
5) New non-Malaysia SPR quota of 5% at neighbourhood level and 8% at block level.
6) Ethnic limit for Indian/Others raised to 12% at neighbourhood level and 15% at block level.

We are now starting to see more and more measures being put in place to prevent a runaway increase in HDB and private property prices.

Prices have already gone up a lot mainly because the increase in HDB supply over the past couple of years was insufficient to meet the increase in demand from a fast growing population. Price is always a function of demand and supply – as simple as that.

When all these changes take effect (and our population starts to decrease due to more stringent criteria on foreign workers), HDB prices should stabilize and perhaps even drop. However, I don’t expect a drastic drop as the cost would be too huge for the government to let it happen.

Deutsche Bank will be listing the first ETF in the world to track the MSCI Indonesia Index, the db x-trackers MSCI Indonesia ETF, in Singapore from 8th March 2010.

The ETF will be denominated in USD with an all-in fees of just 0.65% per year.

Bloomberg Ticker: XMIN SP
ISIN: LU0476289623

Indonesia has been one of the top performing markets in 2009, with MSCI Indonesia returning 117% from Jan 2009 to 26 Feb 2010. Over that same period, MSCI BRIC returned 77.6%, MSCI China 51.5%, MSCI USA 26.5%, MSCI World 27.3% and MSCI Europe returned 20.7% respectively.

With this new ETF, investors in Singapore will have a low cost way of investing into the Indonesia market.