Monday, April 24, 2017

Government paid child benefits for self-employed

It's always hard to find stuff for self employed individuals like me, so since I've already done my research, I might as well share it with others who are in a similar situation as me. I just had a baby boy and he's doing mightily fine. As a self employed, I have no company benefits as a father. Since almost all the benefits given by the company as a employee is co-shared by the government (meaning that the G will reimburse the company), I can only claim the part of the benefits that is given by the government, called Government Paid Paternity Leave (GPPL). What about the company's portion? Too bad, that's part of the cons of being a self employed, so I can only LPPL.

There are two benefits that a father can claim, if you fulfill the following conditions:

1. Your child is a Singapore citizen
2. You are lawfully married to the child's mother 
3. If you're self employed, you must have engaged in your business for at least 3 months before the child's birth 

As a working father, I'm entitled to 3 types of benefits:

1) Government paid paternity leave (GPPL)
2) Government paid shared parental leave (SPL)
3) Government paid childcare leave (GPCL)

A lot of information can be found in the aggregate of links here. But trust me, it's actually quite confusing, especially when there are so many links point here and there. I digested as much of the information as I can, and as accurately as I could, and present it here:


Government paid paternity leave (GPPL)

I'm entitled to 2 weeks of GPPL. There are 2 ways to take the paternity leave. You can either :

a) take it in one continuous block within 16 weeks from the birth of the child. This means 14 calendar days, inclusive of weekends and public holidays taken consecutively from start to end. OR

b) take it by days, with a break in between leave dates, within 12 months from the birth of the child. This is will be based on the number of working days you have per week. If you work on a 5 day work week, your total entitlement will be 2 weeks x 5 workdays per week = 10 days

The leave is also subjected to a cap of $2,500 per week, so one cannot claim more than $5,000 from the GPPL for the 2 weeks. The exact payment is calculated based on our notice of assessment from the IRAS, specifically, the net trade income portion. Exactly which year of assessment of our tax will they use, they are unable to advise. I found this, read it, yet I ended up being as clueless as I started. So I emailed them.




They can only say that the latest net trade income details in their system at the point of submission will be used, and if there are any discrepancies, we can write back to them by providing the notice of assessment for their review. 

I did find out how they compute the reimbursement and that depends on whether you take it in one continuous block or take it by days.


I took (a) as I think it's better for me. You might want to calculate both and see which works out better for your case.


Government paid shared parental leave (SPL)

Government paid shared parental leave is the sharing of 1 week out of the 16 weeks of the government paid maternity leave by the mother with the father. For the father to even qualify for the SPL, the wife must first be eligible for government paid maternity leave in the first place.

This SPL must be consumed within 12 months from the birth of the child, and any unconsumed SPL after 12 months will be forfeited. There is no minimum period that an applicant must have carried on his trade, business or profession in order to qualify for SPL, as long as there is allocation from his wife to him in his current employment.

I have no experience in this as I didn't apply for this. My wife has problem claiming maternity leave as it as, so no help from me in this segment. The explanatory notes for both GPPL and SPL is here.


Government paid childcare leave (GPCL)

This is for both parents each to take paid leave to take care of the child. It'll be eligible for both parents per year until the child reaches above 12 years of age. Those who are employees will get doubled of what I'm going to write next because I think half of the childcare leave is reimbursed to the company by the government. Again, I'm LPPL so I can only take the GPCL, which is half of what normal employees are entitled to. For a child below 7 years old, the GPCL is 3 days per year per parent. For a child between 7 to 12 years old, the GPCL is 1 day per year per parent.

The calculation is based on the number of working days per week, and that you have to key in when you submit your claims. The formula is here:


Do take note that the childcare leave is subjected to a cap of $500 per day, so there'll be a cap of $1,500 per calendar year.

The full details for the GPCL is found here


Application

Before you apply, you need to key in your banking details and update your particulars.

A) Go to the government paid leave website here and login to the e-services as a self employed person


B) Click on Maintain profile and update your details, including the all important banking details. This will be the bank account that the money will be transferred to, when it is submitted and approved.


C) Under Online application, there are two options: Government paid childcare leave and government paid paternity and shared parental leave. The instructions are clear cut and you just need to submit the information such as working days per week, birth cert number of your child and the child's birth date etc. The whole process takes less than 5 mins to submit.


I think for both my submission of GPPL and GPCL, only 3 to 4 working days transpired between the date of submission and the receipt of the reimbursed money from the government. I think they have a service standard of processing the entire thing by 10 working days. The whole process is very smooth and painless, once you sort out what you can claim and how much.

Wednesday, April 12, 2017

Newbie's guide to market depth

SGX is running a promotion for free market depth information, limited from 3rd April to 30th June 2017. I’ve not seen them done this ever before, so perhaps they are doing this to boost the liquidity of the market, or to sell them the subscription. Either way, take this as a free trial and see if it’s useful for you or not. Quite a few brokers are participating in this, like CIMB, DBS Vickers, KGI, Lim&Tan, Kim Eng, OCBC, Philips, RHB and UOB Kay Hian. And before you ask, no, stanchart is not part of it, but you can always access the market depth information from other brokerage platform.

The more important question is how to use market depth. I’m the first to confess that I’m not an expert, but I’ve read and researched enough to know a tiny bit about it, so I’ll share with readers here. I divide this into two sections, the first are the points to look out for when using market depth and the second is about the limitation of the information you get from it. It’s good to know both the usefulness and the limitations of it. By the way, I’m using poems, so it might differ a bit from yours if you’re using other brokerage platform, but it’s largely similar.

Section 1: Points to look out for

1. Is it a buyer or a seller’s market?

By comparing the total buying volume on the left side and the total selling volume on the right side, we can see if it's a buyer or a seller's market. Buyer's market means that the selling will be very well absorbed with very little price movement downwards, because there are a lot of buyers waiting in line to buy. Conversely, in a buyer's market, any buying up will be met with lesser resistance because there are not a lot of sellers waiting to sell at higher price than the current price. In other words, in a buyer's market, the ease of movement of price upwards is easier than the ease of movement of price downwards. In a seller's market, the reverse happens - the ease of movement of price downwards is easier than the ease of movement of price upwards.

Buyer's market - note that there is so many pple waiting to buy on the Bvol side (left)

Seller's market - note that there are more pple waiting to sell on the SVol side (right) than the left

2. Check immediate resistance and support level

This is a TA concept. Resistance refers to a price where the price will likely hit a wall and move downwards. Support refers to a price where the price will likely hit a springboard and rebound upwards. Here, we are looking for big volume camping around a price range. If the normal queue is 1000, 800, 1500, and suddenly we see a 200,000 queue, then that is significant.

The left side represents the possible support level at 1.080. It's going to be hard to go below 1.080 for the time being. The right side represents the resistance level at 1.095 and 1.100. It's going to be hard to go beyond 1.100 for the time being.

Looking at the above pic on the left side, we can see that there's a huge volume camping of about 2.7 million shares at 1.080. If the price is to go below 1.080, it will have to break that huge wall first. Hence, for the time being at least, it's going to be hard. On the right side, we can see an even bigger wall of about 10 million shares distributed over 1.095 to 1.100 range. It's going to take a while to break that wall and go to 1.105.

If you're buying, and you want to jump the long queue, you might as well queue at 1.085. If you're selling and you want to jump the queue, you might as well queue at 1.090. That's just one way to see it. You can also set a order to buy at 1.105 once the market price reaches 1.110, because it means the the stock broke out of the huge wall block and that's usually a good sign. Go back to TA to decide what to do with the information you get from the support and resistance levels.


3. Can the market absorb my buying and selling?

If you want to sell a huge volume, you want to ensure that the price remains as stable as possible. You don't want your huge order to bring down the price and end up having a lesser amount at the end of your selling. Likewise, if you are buying a huge volume, you don't want the price to be bidded up too huge so that at the end of the day, you'll end up paying more for your shares. All these requires the market to have enough 'depth' to absorb both your selling and your buying, without affecting the price too much.

A good analogy is that of a reservoir. If you scoop up a cup of water from it, the water level is not going to change much because it has a lot of 'depth'. Conversely, if you pour a cup of water into it, the water level is also not going to rise much (not even perceptible!). If you do the same experiment on a pail of water, you can see the water level rise and fall much more appreciably. This whole concept is market depth.

SGX guide here already have a great example, so I'm not going to reinvent the wheel. I reproduce it here for your reference.



Section 2: Limitations of market depth

1. Market depth is dynamic.

The information is probably only valid for a day. Maybe just for a few hours. We don't know. The volume reflects the live order keyed into the system, so it keeps changing. In a fast moving market, a static picture of the live market depth information probably should have an expiry date of only a few minutes.


2. Order volume might be hidden

I know institutional traders can have an option to disclose a certain percentage of their trades in the system only, called disclosed quantity buying/selling. Let's say that a big boy (BB) wants to sell 500k shares at a certain price, it can choose to disclose only 5k shares in the system, so only 5k is seen in the market depth, and not 500k. Is this available in Singapore, I'm not sure about that though as this is something I've read about in US markets. If it's available here, then whatever you see in the market depth is just what others want you to see.


3. Order volume might be fake

The orders placed might not be real. By fake, I mean that there is no real intention to buy or sell the entire order seen in the market depth. The volume in the market depth can be removed at any time. It could be used to test the market or to find out who the counterparty is. There are several reasons why they want to do this. One reason could be to prevent the price from going above a certain price. Whenever the volume gets depleted, more volume will be topped up to discourage buyers from bidding higher. This same trick can also be used to dispose of shares in a very orderly manner without people knowing it. Only people with too much time watching the 'tape' can see it. In structured warrants, you will see lots of such actions happening.


4. There are buyers or sellers who do not queue.

You’ll only see something in the market depth if people queue for it. There are companies where buyers or sellers do not queue at all. Immediate transaction will happen if you sell at bid and buy at ask, so in such cases, it won’t be so useful.


Conclusion:

Market depth is paid for under a subscription. I didn't use it in the past because I'm too cheapskate to have it. Is it useful? Yes it is, but it's not essential. Good to have but not that important in the longer run. Perhaps it'll be more useful for intra day traders, which I'm not.

Saturday, April 08, 2017

Gradual effort, sudden result

A long time ago when I was just a newbie tutor, a parent sat in with my student for a lesson. After teaching the theory, I set the student to some work. For the greater part of the duration of the lesson, the parent saw me doing nothing but just watching the student do his work. Occasionally I would point out some things here and there but that's about it. The parents remarked that since I'm just baby sitting her kid and doing nothing much, how come I charge so much for the fees?

In the past, to prepare for the 2 hr lesson, I likely have to spend more than 2 hours preparing for it. I've already gone though all the different possibilities in the questions type, all the possible errors and thought through the best way to structure my lessons so that there is a framework for the student to grasp on. It seems like I'm not doing anything DURING the lesson, but that's only because the work had already been done BEFORE the lesson. I also do post lesson reflection to see if there's anything I need to improve on. That's what I do every lesson for the first 2-3 yrs of my career. That accelerated my learning tremendously.

Effectively, I spent 2-3 yrs of constant gradual effort so that I appear to do nothing when I am seen at work.


This is just one example where there's a hokey stick progression - one long almost flat bar of nothing, then boomz it shoots up. The thing that broke the camel's back is also not the last straw that is piled on top of it - it's broken by the accumulation of all the straws on top of the camel before the last straw is piled above it! It's also how the Chinese bamboo grows. You water it everyday for the 1st year and you see nothing. You do the same for the 2nd year and you see nothing. By the third year, you're starting to feel anxious...and suddenly in the 5th year, just when you're about to give up hope, it breaks ground and grow to a height of 27 m in one year! It would seem that that bamboo grew 27 m in one year, but it really took 5 years for it grow 27 m.

Gradual effort, sudden result.