Dec 15 2009
NTUC Income has increased their tranche of Capital Plus (CPN16) and will be extending the offer of this plan till 21st December 2009 (next monday).
They will provide guaranteed acceptance for any application that reaches their office by 21st December, 5.00pm.
Looks like demand for these kinds of product seems to be tapering down.
Dec 04 2009
NTUC Income just launched their latest tranche of Capital Plus yesterday.
Capital Plus CPN16 is a single premium non-participating plan which offers a guaranteed return of 1.6% p.a. for a 2 year term, available for new and exisiting policyholders. This means an initial investment of $10,000 will have a maturity value of $10323.
The minimum investment is $10000 and can only be bought using cash and funds from SRS.
Application will be closed once they have reached $25m or 14 Dec 2009, whichever is earlier. Application is on a first-come-first-serve basis.
For comparison, the current fixed deposit rates are as follows (figures provided by NTUC):
| Bank |
S$ Fixed Deposits, |
||
|
12-Mth |
18-Mth |
24-Mth |
|
| DBS |
0.45% |
0.60% |
0.70% |
| OCBC |
0.55% |
0.60% |
0.70% |
| UOB |
0.45% |
0.60% |
0.70% |
| Citibank |
0.45% |
0.60% |
0.70% |
| HSBC |
0.48% |
NA |
NA |
| Maybank |
0.88% |
1.00% |
1.00% |
| StandChart |
0.35% |
0.72% |
0.76% |
| RHB |
0.75% |
0.88% |
1.13% |
| Average |
0.54% |
0.71% |
0.81% |
The table doesn’t include CIMB which currently offers 1.2% for a 12-month fixed deposit and 1.4% for a 24-month fixed deposit.
Oct 28 2009
In the past few months, we have seen a number of single premium non-participating insurance plans being launched by different life insurance companies: AIA, NTUC, Prudential, HSBC and TM Asia Life.
The plans are either 2 or 5 year terms offering yields of between 1.4% to 2.75% p.a.
The recent trend sees the yield getting lower compared to the series that were launched earlier in the year. For example, HSBC’s current Guaranteed Saver Plus gives a yield of 1.8% to 2.0% p.a. for a 5-year term, compared to an earlier 2.25% to 2.75%.
However, the take-up rate for these plans remains tremendous. With the plans being of “limited size”, consumers have been quick to take up the plans. The latest offering by TM Asia Life took less than a week to be fully subscribed.
Looks like this is the hot product in our market now. The liquidity fueling these products is likely to be funds being transferred from banks.
Sep 25 2009
The NTUC GrowthLink is a single premium Investment-Linked Plan (ILP) that allows you to invest in the Aim Series of funds with a bit of insurance protection against death and total and permanent disability (TPD).
Protection
From age between 0-64, there will be an insurance protection of 105% of the total invested amount for medically standard life. For medically sub-standard cases, the coverage will be a token 101% of the invested amount. If the value of the units is more than the insurance protection, that will be the amount paid out on death or TPD.
From ages 65 onwards, the payout on death or TPD will be the value of the units or the total invested amount (whichever is higher).
Premiums
The GrowthLink plan is available under cash or SRS. The minimum premium to start off the plan is $5000 with ad hoc top ups of minimum $1000. You can also schedule regular single premium top ups of $250 quarterly, $500 half-yearly or $1000 annually.
Charges
The GrowthLink policy does not impose any fees for the cost of insurance. There is also no initial policy fee but there will be an annual fee of $50 deducted at each anniversary date. If someone invested only $5000, this $50 will be quite high in the first few years (almost 1% of amounted invested.) On the other hand, if the investment amount is $50,000, it works out to be only 0.1%.
Funds are sold at a bid-offer spread of 3.5%. As the policy currently gives bonus units of 0.5% on invested amounts, the effective bid-offer spread will be 3%. This is higher than online DIY unit trust portals which charge around 2%, but lower than the 3-5% typically charged by banks.
The Aim Series of Funds also have a relatively low annual management fee (about 1%) compared to other unit trusts. At this stage I’m not sure whether the fund manager Schroders will rebate part of the annual management fee back to the fund if it invests into other Schroders unit trusts. The cost structure will be very good if it can do that.
Funds
The funds available under the GrowthLink plan includes not only the new Aim Series, but also NTUC’s previous funds available under their ILP. Unlimited free switching is available for policy holders. The list of funds are as follows:
I like the life cycle and market cycle idea behind the Aim Series of Funds, although how well the fund performs (relative to other life cycle funds out there) will ultimately depend on the skill of the fund manager in implementing their market cycle analysis.
Sep 24 2009
NTUC Income yesterday launched their Aim Series of funds, a collaboration between them and Schroders Asset Management.
The Aim Series of funds aims to take away the complexity of investment from the consumer, by offering a choice of 5 life cycle funds:
The funds will invest in a mix of equities, bonds and other assets such as commodities and property.
Essentially, you will just need to select the fund that fits the target year when you need it. For example, someone who plans to retire in the year 2035 can simply invest in the Aim 2035 fund.
The fund manager will manually adjust the asset allocation of the underlying assets of the funds at different points of time so that the risk of the portfolio gets lesser as it approaches the target year.
While there are currently a few other life cycle funds in the market right now, how the Aim series is different is that the fund manager (Schroders) will also adjust the asset allocation according to the market cycle.
Depending on their views of whether it is an economic slowdown, recession, recovery or expansion, they will overweight or underweight specific sectors accordingly. If the fund manager can perform this role well, it will deliver extra returns to the fund compared to a normal life cycle fund.
For the Aim Now fund, it will target to return a distribution of 4% every year.
The Aim series of funds will be available on NTUC’s newly launched Investment-Linked insurance products (ILP), VivoLink and GrowthLink. More on the cost structure of VivoLink and GrowthLink in a later post.
