Shinsei Bank Investement Offer

[Ches]

First of all, I'm probably the most stupid person when it comes to math. Knowing that TAG has many math majors, I would like to ask for help.

Shinsei bank offer time deposits for one year maturity and 2 weeks maturity.

For example 1 million yen

One year maturity return is at 0.025
Thus, it will yield 25,000 per year

For two weeks maturity period, return is at 0.050
Thus, it'll yield 50,000 in two weeks?!!!

Isn't that weird? Or Am I missing something? Anybody care to explain?

Or maybe 0.050 is in percentage thus it'll be 0.00050 in decimal which would yield 500 from 1,000,000 in two weeks (which is more believable)

However, if that is the case then 0.025 of one year maturity period must be in percentage too so it gives 0.00025. Hence 250 from a year? Not very reasonable. So I'm confused.

I know a lot of you guys probably has Shinsei Bank, coz it is dubbed as the most gaijin friendly bank in japan. Have you ever availed this investment offer of shinsei?

Also, I maybe wrong with my assumptions so please correct me.

Which of the two would yield greater returns if we do proper computation? Two-weeks maturity period gives compouding if continuous and One year maturity should definitely have higher returns. But I am still confused. I would appreciate all response.


Please see the YEN deposits.
I have attached the photo of the table of rates.

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[veryniceguy]

and then they deduct 20 +% tax from that interest income......
You are better off to find a company stock that pays better dividends....or just forget about "placing money" ....time deposits in Japan are almost worthless....

 

[Ches]

You are better off to find a company stock that pays better dividends.

Stocks are highly volatile. I have a stock account but not in Japan. I only invest what I can afford to lose. Thus I only do monthly averaging for stock market, very little money.

This one, I plan to put my savings and I want it to be 100% secured even if it won't yield as much returns as risky investments like equities. I just don't like making money sleep in the bank and having the value degraded by inflation.

 

[veryniceguy]

Of course stocks a volatile.... and the upcoming American election will, for sure, influence the market. You have a stock account outside of Japan..... Maybe that account company (like Ameritrade?) or whatever, has CD offers that yield more than what you can find in Japan. There are , of course, the tax implications. But one million yen, in any currency conversion, is not gonna earn a lot, But for sure, the yield on "time deposits" in Japan is so low; why bother? You could make more in Pachinko!

 

[Ches]

why bother?

I think I just previously stated my answer to that.

I just don't like making money sleep in the bank and having the value degraded by inflation.

But one million yen, in any currency conversion, is not gonna earn a lot

Definitely not a lot, that was an example. Plus what do you expect from a 21 year old fresh uni grad? Lol At least I am not 6 feet under college debt
Totally debt free, courtesy of parent

Pachinko!

I'll definetely come, only of you treat me lol

 

[Wwanderer]

Forget Pachinko! Let me teach you to play poker if you want to gamble with your money. (And no, not strip poker...which is a blasphemy against a noble game.)

-Ww

 

[Goiter]

Those are yearly interest rates. Not how much you'll make in two months.

I really hope Solong doesn't chime in and change this to a conversation about the shape of the yen yield curve......

 

[Sudsy]

Goiter's got it right - those are annual rates, and they don't include any back end fees. Putting your money in a time deposit in Japan is worthless.

For example 1 million yen

One year maturity return is at 0.025
Thus, it will yield 25,000 per year

As that's an annual rate, and it's 0.025 percent, your annual return would be 250 yen. Then, of course, there will probably be a fee for opening the account...

You would get a better rate of return by simply not driving or taking a train downtown to your bank to do the paperwork.

If you can arrange it, a simple money market fund in your home country (or offshore) will likely be a far better investment in the long run, if you want something truly conservative.

If you want your money to stay in Japan, there are conservative consumer-oriented funds at securities companies like Daiwa or Nikko that aren't great, but are stable and offer a few points above the banks.

 

[Ches]

Goiter's got it right - those are annual rates, and they don't include any back end fees. Putting your money in a time deposit in Japan is worthless.



As that's an annual rate, and it's 0.025 percent, your annual return would be 250 yen. Then, of course, there will probably be a fee for opening the account...

250 yen for a year? [emoji33][emoji33][emoji33]

My face right now
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I think I need to look into goverment bonds of third world countries instead lol. They offer high interest with little to no risks, unless, they default like greece lol.

 

[Goiter]

250 yen for a year?

My face right now
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I think I need to look into goverment bonds of third world countries instead lol. They offer high interest with little to no risks, unless, they default like greece lol.

Currency risk my dear.....

 

[Ches]

Currency risk my dear.....

True! The exchange rate is gonna kill it. [emoji24]

 

[Sudsy]

They offer high interest with little to no risks, unless, they default like greece lol.

As a general rule, the higher the interest, the higher the risk. Keep that in mind.

 

[Ches]

As a general rule, the higher the interest, the higher the risk. Keep that in mind.

Government bonds though are immune to extremely high risk unless something like greece happens. Only problem is the exchange rate. I need to look into forex and making money from exchange rates. I haven't look into that.

 

[Sudsy]

Government bonds though are immune to extremely high risk unless something like greece happens. Only problem is the exchange rate. I need to look into forex and making money from exchange rates. I haven't look into that.

The exchange rate risk is precisely why some government bonds have high interest rates. They're basically printing money and devaluing their own currency, and gambling that their economy will improve.

As to forex... unless you're moving huge amounts of money, that's not a day trader game. Lots of companies out there push forex trading, but what they fail to mention is the interest rate spread and transaction charges.

As a novice, get your feet wet with conservative mutual funds. They're pretty much always a long term winner, even if they aren't exciting.

 

[Ches]

I really hope Solong doesn't chime in and change this to a conversation about the shape of the yen yield curve......

Let's try! Hey @Solong

 

[Wwanderer]

Let's try! Hey @Solong

Soon naughty!

-Ww

 

[raumsagan]

while there are many schools of thought on investing, the road begins with a few questions:
1. How long do you intend to not touch the money you will invest? (short-long)
2. What kind of tolerance do you have for risk? (conservative-adventurous)
3. Citizenship and how long will you live in your current residence?
4. How much do you want to initially invest and contribute to over time?

The answer to #1 & #2 will give you a range of options. In general, these look like:
Long-term/Conservative: bonds or cash-like things / stock-mix (low share of investment)
Long-term/Adventurous: stock, exotic investments*
Short-term/Conservative: bonds, cash-like things, or just deposit
Short-term/Adventurous: volatile stock/day-trading / other exotic investments

Long-term investments come with the cost of not being able to touch your cash for extended periods, which may defer the cost of inflation depending on global markets but can put you in a bind if you need money and the markets are doing poorly.
Short-term investments generally pay out lower, unless you go for the risky variety (and corresponding higher chances for loss) - but you can get your investment back quicker.

The country of residence will dictate what you can invest in - since in some countries, getting foreign stock will expose you to currency risks (as mentioned above) and other regulatory things (taxes etc, -- I hear the US government will tax you for offshore investments, therefore a US citizen investing overseas could potentially face double taxation -- there are finer details around this, such as a way to avoid the tax but I leave that to the citizens themselves)

The last question is just a confirmation question as to how dedicated one is to investing . As, investing is something that will inevitably take away from your available cash pool.

my two or three yen on the matter

edited for clarity

 

[DocMcStuffins]

Great post. Although risk tolerance is tricky. Ideally you should ignore it. Most people don't know their risk tolerance until after they lose money.

 

[raumsagan]

Great post. Although risk tolerance is tricky. Ideally you should ignore it. Most people don't know their risk tolerance until after they lose money.

I totally agree with you there.
I put it there just so one has an idea what "risky" investments look like

 

[Ches]

Today, I just accessed my shinsei account for the first time. Went to a nearby atm. No english support. I used google translate to understand the kanjis. And then I picked the change PIN (coz I currently have an assigned one). I accidentally entered a wrong pin lol. There is no way of corrections. No way of retrieving the card. No cancel button. No erasure button. They asked me to call the ATM phone. Japanese support only. I tried calling using my mobile for english support always always ALL LINES ARE BUSY. So, I can't wait forever in that booth so I left the card on the machine. Machine says please call operator. I've been calling again and again now, but ALL LINES ARE BUSY. Shinsei is a shithole bank!!!

Ps: I wasn't gonna avail the time deposit offer. I was just gonna do a deposit but oh well, my card still in their machine. Hopefully it is safe lol. Doesn't contain money anyway.

 

[split]

I've worked in banking b4. Typically the branch will hold the card for 30 days.

 

[Ches]

I've worked in banking b4. Typically the branch will hold the card for 30 days.

Will they call me? I've been calling them. No answer. I don't have much time for this shit. Plus that wasn't a branch. It was an atm booth with only one machine. いなかだから

 

[Sudsy]

Today, I just accessed my shinsei account for the first time. Went to a nearby atm. No english support. I used google translate to understand the kanjis. And then I picked the change PIN (coz I currently have an assigned one). I accidentally entered a wrong pin lol. There is no way of corrections. No way of retrieving the card. No cancel button. No erasure button. They asked me to call the ATM phone. Japanese support only. I tried calling using my mobile for english support always always ALL LINES ARE BUSY. So, I can't wait forever in that booth so I left the card on the machine. Machine says please call operator. I've been calling again and again now, but ALL LINES ARE BUSY. Shinsei is a shithole bank!!!

Ps: I wasn't gonna avail the time deposit offer. I was just gonna do a deposit but oh well, my card still in their machine. Hopefully it is safe lol. Doesn't contain money anyway.

My sympathies - unfortunately Friday afternoons are the busiest times (outside of payday) for most bank call centers. Hope you get your card back!

 

[split]

Will they call me? I've been calling them. No answer. I don't have much time for this shit. Plus that wasn't a branch. It was an atm booth with only one machine. いなかだから

They probably won't call you. Too busy for that. Maybe they will automatically send it to you (given it's their card). Doubt it. Just order a new one. Much easier (if you can get anyone to answer). FYI: rates are determined by APR and APY. APY is the rate after your interest is calculated with the principal. Banks typically advertise APY because it's higher. Both APR and APY are based on 12 months.

 

[lennylenny]

and then they deduct 20 +% tax from that interest income......
You are better off to find a company stock that pays better dividends....or just forget about "placing money" ....time deposits in Japan are almost worthless....

Do you know if they have social security investments here? I had some invested in social security and real estate credit bonds, but i moved everything to the social security, cuz since im divorcing now, it wont be shared as it would in real estate bonds. In my country, it rates around 10~12% a year, 12,06% on the last 12 months period, from today. Can you get that kind of rates here? I guess that social security investments really vary depending on the countrie's policies, right?
Also, the taxes are reduced by 50% after 5 years and to 0 after 10 years. Since i like some predictability while relating to my finances, that seemed to be a good option to me.

Anyway, do you think is too delusional to think i could find a similar investment option here in Tokyo?