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FAQ

01. Singapore Government Bonds
1) What are Singapore Government Securities (SGS)?
2) Why invest in SGS bonds?
3) How are SGS bonds issued?
4) Who are the primary dealers of the SGS bonds market?
5) What is secondary market and how is it different from primary market?
6) What is the role of Fundsupermart.com in the SGS bonds market?
7) Can non-residents invest in SGS bonds?

Q: What are Singapore Government Securities (SGS)?

A: SGS Bonds are debt instruments issued by the Government of Singapore through the Monetary Authority of Singapore (MAS). SGS comprises of Treasury bills and bonds. Treasury bills are bonds that have year to maturity of less than 1 year. Fundsupermart.com currently retails a range of SGS bonds with longer maturities.
 
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Q: Why invest in SGS bonds?

A: SGS bonds provide regular income via coupon payments. SGS bonds are considered safe investments as they are backed by the full faith and credit of the Singapore Government. The probability of a default is negligible. For more on SGS bonds, you may go to www.sgs.gov.sg
 
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Q: How are SGS bonds issued?

A: SGS bonds are issued by the MAS on behalf of the Singapore Government. SGS bonds are issued in the primary market, in the form of auctions and only the Primary Dealers in the SGS bonds market are allowed to submit bids at the auctions.
 
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Q: Who are the primary dealers of the SGS bonds market?

A: The SGS bonds Primary Dealers are appointed by the MAS. Primary Dealers are obliged to provide liquidity in the SGS bonds market by quoting prices on all SGS bond issues under all market conditions.
 
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Q: What is secondary market and how is it different from primary market?

A: Secondary market is the market for bond issues that were previously sold whereas primary market is the market for new issues.
 
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Q: What is the role of Fundsupermart.com in the SGS bonds market?

A: Fundsupermart.com functions as a Secondary Dealer in the SGS bonds market and we do not participate in the primary market. We offer for sale SGS bonds that were previously issued at the SGS bonds primary market. As Fundsupermart.com operates on the model of a retail aggregator, we are able to negotiate better prices on behalf of our customers compared to the single investor.
 
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Q: Can non-residents invest in SGS bonds?

A: There are no restrictions to non-residents purchasing SGS bonds. For all SGS bonds issued after 28 Feb 1998, interest earned by non-residents who do not have any permanent establishments in Singapore are also exempted from tax.
 
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