RetireJapan

Question in title.

I'm looking to hold parts of my emergency fund / spare cash into those, so somewhere between 3~5m yen.

A quick search shows that VGSH is available at SBI. VIFSX and VUSXX don't seem purchaseable?
Are there any others?

https://investor.vanguard.com/investmen ... ofile/vgsh

Jansen wrote: ↑Wed Jul 12, 2023 3:42 pm Question in title.

I'm looking to hold parts of my emergency fund / spare cash into those, so somewhere between 3~5m yen.

A quick search shows that VGSH is available at SBI. VIFSX and VUSXX don't seem purchaseable?
Are there any others?

https://investor.vanguard.com/investmen ... ofile/vgsh

Be aware of currency risk. For instance, the recent swing over the week would have wiped out any profits

Also check out Tokyo list ETFs. I've linked the bond offerings.
https://www.jpx.co.jp/english/equities/ ... 01-09.html

Finally Nasdaq and NYSE offerings are broker dependant.

TokyoBoglehead wrote: ↑Thu Jul 13, 2023 2:18 am

Jansen wrote: ↑Wed Jul 12, 2023 3:42 pm Question in title.

I'm looking to hold parts of my emergency fund / spare cash into those, so somewhere between 3~5m yen.

A quick search shows that VGSH is available at SBI. VIFSX and VUSXX don't seem purchaseable?
Are there any others?

https://investor.vanguard.com/investmen ... ofile/vgsh

Be aware of currency risk. For instance, the recent swing over the week would have wiped out any profits

Also check out Tokyo list ETFs. I've linked the bond offerings.
https://www.jpx.co.jp/english/equities/ ... 01-09.html

Finally Nasdaq and NYSE offerings are broker dependant.

Just looking at the Fund List for the SBI iDECO (just because that is what I had to hand...), I see there is a Nikko Asset Management Advanced Country International Bond Index Fund with Foreign Currency Hedge - 先進国債券　日光アセットマネジメント　インデクスファンド海外債券ヘッジ有
which would take the Forex risk out of the equation, if available outside of iDECO...

Forex Hedging has been discussed in another thread or two...

I have searched long and hard for any way to get risk free yield on my Yen emergency savings and the sad conclusion is that there is no reasonable way to do so. So I just keep it in Japanese bank accounts earning 0 interest but at least with the security of knowing it is government insured up to 10 million Yen.

I have purchased VGSH through Monex before, and I think SHY also.

On the other hand does buying US ETFs count as emergency fund?

I never heard of emergency funds until relatively recently, but for me I just have some cash in the bank. I see these bond exposures as part of my investment portfolio.

Jansen wrote: ↑Wed Jul 12, 2023 3:42 pm Question in title.

I'm looking to hold parts of my emergency fund / spare cash into those, so somewhere between 3~5m yen.

A quick search shows that VGSH is available at SBI. VIFSX and VUSXX don't seem purchaseable?
Are there any others?

https://investor.vanguard.com/investmen ... ofile/vgsh

I believe an emergency fund in USD should be invested in very short-term maturity US government debt, specifically short-term T-bills with a maturity of 1 to 3 months. By doing this, you can avoid both credit and interest rate risks. In my opinion, the best short-term T-bill ETF is the one with the ticker BIL US ticker.

I have an SBI account, but I am unable to access it during the weekend due to site maintenance. However, I would be surprised if the BIL US ETF is not available on SBI, as it is a major ETF with $28 billion invested.

Regarding the ETFs you mentioned:

1)VGSH ETF has an average maturity of 2 years, which exposes you to interest rate risk. For example, last year it returned -3.85% due to the rise in interest rates. Therefore, I don't think it is suitable for an emergency fund.

2) VIFSX ETF invests in the S&P 500, so it is not appropriate for an emergency fund.

3) VUSXX ETF is similar to T-bills, so I believe it is suitable.

However, as mentioned by other contributors, if you are a JPY-based investor, an investment in USD, regardless of its risk level, cannot be considered an emergency fund. The only type of emergency fund for me is JPY cash, which unfortunately comes with its horrendous -3.5% real return!"

VG1 wrote: ↑Sat Jul 15, 2023 2:23 am I believe an emergency fund in USD should be invested in very short-term maturity US government debt, specifically short-term T-bills with a maturity of 1 to 3 months. By doing this, you can avoid both credit and interest rate risks. In my opinion, the best short-term T-bill ETF is the one with the ticker BIL US ticker.

But you still can't avoid the Foreign Exchange Risk...

The Yen went from Y144 to Y138 per US$ in one week... So you lost 6 Yen per Dollar, or 4.2%... Unless you hedged the Forex Risk.

Tkydon wrote: ↑Sat Jul 15, 2023 5:31 am

VG1 wrote: ↑Sat Jul 15, 2023 2:23 am I believe an emergency fund in USD should be invested in very short-term maturity US government debt, specifically short-term T-bills with a maturity of 1 to 3 months. By doing this, you can avoid both credit and interest rate risks. In my opinion, the best short-term T-bill ETF is the one with the ticker BIL US ticker.

But you still can't avoid the Foreign Exchange Risk...

The Yen went from Y144 to Y138 per US$ in one week... So you lost 6 Yen per Dollar, or 4.2%... Unless you hedged the Forex Risk.

Indeed, I totally agree. BIL US is an instrument for an emergency fund for USD base investor. For a JPY base investor, it can only be JPY cash.

Hedging USD against JPY could make sense for long term bonds or equities but for TBill the hedging cost is basically the same as the return, so we end up with the same 0 % return than JPY cash!

SGOV is probably even better than BIL if you have spare dollars doing nothing. The fees are lower (0.07% vs 0.14%), the 30 day SEC yield is higher (5.16% vs 5.0%), and the NAV price is stable. It's probably not available on SBI though. I'm still on IB LLC and it's available there.

I have two parts to my emergency fund. I have a couple M stashed away in a bank that I don't use. I have several million more that I'd like to keep up with the world economy and not inflate away to nothing. Hence my looking for short term T Bills, preferably 6 months - 1 year but I'll take what I can get. I've been trying to look for BIL on SBI for the past week and it doesn't seem to pop up. Some of the tickers on this page are available.

https://etfdb.com/themes/short-term-gov ... bond-etfs/