Cory Diary : Historical Milestone - Net Worth

Asset Class diversification is important for peace of mind. It can be Equity, Bonds, Property, Cash, FD and diversification within like for example recently I expanded to Euro and Pound denominated Reits in Europe properties. I also developed a plan entering into US market by mini portfolio even though timing could be better. Bonds wise I have SSB Max and in the work to reduce Company Bonds for CPF.

One of the challenge will be how to Simplify my operation while achieving the Diversification needed. This means reducing errors, market volatility with poor quality assets and getting better in my investments. And therefore more time for family and work.

To combat inflation, having investment returns and also a shelter over my head when needed, I decided to invest in Property. This allows me to sold off all my gold position which serve inflation purposes. In my earlier article I have worked out the Math on why property investment is attractive due to Rental income and leverage. TDSR and ABSD have also limited over speculation so one is unlikely impacted by installment arrears. Even if one got their timing wrong, over the long term the return from rental or own stay which avoid paying rents, will likely gives property buyer a high chance in the black and probably good returns on average. 

To add for residential property, I feel is very unlikely to have EHT or Noble events that we see in stock market as long we can hold our property. Being in equity market over decades, property is certainly the easier path to go and imo for most people who can afford, within the current regulatory constraints that interesting help largely minimize the risk of default. The stock market is not a level playing field even though over the years we are getting better. Is much tougher to profit from it with many learnings needed to stay in the game even though I have profited some amount. 

Why all the write up above with the subject line. I just checked URA transactions, and PSF wise there is another increase on recent month. Is a surprise. Covid ? What Covid ? This bring my Net Worth to another magical milestone level. Interesting just yesterday, I told my wife that if I hit the Net Worth milestone, we can afford to buy another larger de-humidifier. It was a passing remark as it will be our 3rd in the home. So if we going to get it, and the stock market doesn't look like will push it that far in the next month or so, it could be far fetched. Looks like is not far enough ....

Cheers

Cory

2021-0331

Articles in this Blog is personal take and educational purposes only. Reader should seek their own professional help when making financial decision and be responsible for their decision.

Cory Diary : Home anytime ?

When I was developing my retirement datasheet, one of the most influential item is housing loan. It takes a big chunk off my saving. Therefore if I could, I would prefer to borrow for the longest period like 30 years whenever possible so that it reduces my monthly or annual drawdown as I build up my others. And that's me. Of-course like many things in life, people have choices to their preference. Some want to pay up asap. Some won't even buy a home unless they can fully paid a home upfront. They are either from Mars or never able to execute to the plan they wanted. Obviously I do not mean either only. There are many options and rationales and I wouldn't feel like stepping on anyone toes.

Spikes follow by corresponding reduction Chart

There are also others like me that are more conservatives ( Relative term for one who invested more than a 1M in stock market ) or them ( looking at property agents ) who will tell you that for stay, buy anytime. Personally, anytime ? Absolutely rubbish imo.

Home is the most costly and one of the most important asset to most people.  Just have to give an example. If you see a price chart where the price spikes like a needle, good luck to those who follow through their life time deal. Hopefully you won't have to work on the remainder or big chunk of your life time to save the differences !

So is it a good time to buy now ? Your guess is as good as mine. I like to know too ! but I would take a home anytime for a reasonable price after glancing the chart or table or whatever ....

Cory

2021-0321

Articles in this Blog is personal take and educational purposes only. Reader should seek their own professional help when making financial decision and be responsible for their decision.

Cory Diary : Financial Updates

Salary

To most people, the largest impact will be Salary Income. Well, at least for my generation. :) Within the organization we have been asked to prepare a small list for possible retrenchment if there is insufficient attrition. This is not like we are doing bad. The company is doing quite well but I guess the top management always like to see constant lifting of performance bar, talent flows, cost structure etc. It does cross my mind whether should I ask for voluntary however money is always not enough even though financially I am quite ahead on average. 

I am now in the mode to work as long as possible as I am on my comfort pace. The idea of constant cash injection into my saving account, occasional Bonus and then Stock rewards in-additional to other benefits can be quite "addictive" rather than the fear which I think always lies right at the bottom which will surface occasionally when I feel not enough money to invest. To put in easier context to understand, every month of work remuneration equals to a paid holiday vacation for the family. That's how hard to let go.

In-addition to that, able to contribute actively in the workforce and seeing products you are part of is always fulfilling other than being in constant InTouch with the industry and people. Often as well the satisfaction of able to lead and guide members of my team and colleagues will feel rewarding as it does need certainly level of seniority skillset often lacking in the company. I have seen people who work on projects for many quarters when the scope is not really practical or required. This is a sign of lacking experience people who can close them in minutes. So much effort spend on useless projects. Maybe there are too many Project Managers just to keep everyone busy and paid.

Asset Allocation

It has been some time that I have not been Tallying up my asset. I feel the need to do this to move forward as there are competing areas we need to review, balance and invest. Cash, salary, dividends, trades, loans, credit, local/oversea, current/non-current are all the moving parts. How much buffers or spare cash after emergency, housing etc. There are many saving and investment accounts to check. Basically it boils down to Cashflow and Return. To move I need to have a good view on past and current for the future. This is how I derive my Total Net Worth too. Asset wise reach ATH due to gain in company stocks else I think is a flat quarter. Kind of lucky.

There need to be comparison when I talk about adjustments. Here's the previous post. ( link )

Investment Accounts

There's a decrease in investment account as I invested more. Cash is up too. So Probably I could re-balance them. Fixed deposits are now mainly in oversea accounts as I plan to eliminate most of FD locally. Emergency cash is now saving cash. Similarly, Bond will be on downtrend except for SSB which is under Gov securities.

CPF

CPF has expanded due to top ups. And this hope to be annual affair before Age 55. I plan to try out SA investing just to have a good ideal on the Shielding Process. Overall, CPF is a portion of retirement plan and my expectation is Stock will really be the key after I retired.

Expenses

There is a few big ticket items. One is I feel Rei needs a boost in immunity and decided to provide her a RSV. 1K cost in nanny for each girls. A coway air purifier. Coming expenses will be new set of clothing for Xin as she has reached 2 year old. Tax Payment. Have been contemplating to move to a larger apartment but currently at back burner. This could change anytime.

Tesla

I did a quick glance through the recent correction in US Market and most of the spike has been worn off and is back to the manageable slope of growth path. Having step into US market proper, there are opportunities that I could setup more funding on them. One of my favorite is Tesla. Right now the invest amount is minimal but I could expanded my investment exponentially if opportunity arise. Market can still come down as valuation wise is still quite rich across the board.

Tesla is already a profitable company in 2020. However, the profit looks emerging which means trying to use PE to rate them will give you a very high value which looks very expensive but misleading. Price has swing down from 800s to 500s and back up to near 700s. The swing is wild which I never expects that being new to this market.

For Tesla current PE ratio is 1083. Astronomical number. However the earning could doubled quickly from 0.64 to 1.28 and the PE could come crashing down to 500s. I am not saying it will be this for sure but for a high growth company which is just profitable, the potential is there. The EV Car is real and selling well and limited by it's production capacity. Is a calculated bet as they are a prime mover of the industry just like Apple on Mobile Phone. You know they are doing well when there aren't need for Sales People. The signs are all there of a successful company on a path of prosperity.

I am quite excited with US stocks even though they are still a small portion of my overall equities.

Reits

Singapore Reit market has been shaken by recent yield spike despite the overall yield is still very low in the grand scheme of thing. So I am quite confident to continue to add. The Reit yield is now quite attractive for example Ascendas and MINT both hit more than 5%. I did a timing trades selling significant portion of my Ascendas when the price peaks to a point I sold too much and need to buy back some just in case I am wrong. That's a good move this Q1 and has been in buying back mode since. That's a few coway saved.

Later batches do takes time to build up as purchases are spaced out in case the retraction drawn out is long. I do not want to be a in situation that my precious fund dry up too early which will be bad for the mean values and missing out a much better yield returns. This also helps to maintain sufficient War Chest which are pooled together not to get depleted before any major crash.

Trading Accounts

Finally, to make thing slightly complex I have a few trading accounts. Trading cost is now a growing concern for me as this point of time. I have been using DBS Treasure for a large portion of my trades now. The transfer of fund is also make easy being connected to the saving accounts. However for US trades I am still going through Poems - Cash Management. We will explore later as we grow over there.

Dividend

Dividend wise for Q1 is a little slow. In summary. Take this with quarterly and half yearly in context for different stocks. Theoretical max is now $57k annual as each time there is market draw down I will start buying bigger which helps to boost my dividend. I hope to be able to achieve $60k mid term.

Syfe

Starting to explore Syfe and probably a few more similar products if any out there for diversification. This is more for legacy planning on how my family can continue to invest in a more assisted way. And will likely to do some try out as this will be easier for wife to manage instead of stock pickings. I have never been keen on Unit Trusts as to me is a black box that can be easily manipulated or affected by a few individuals. I could be totally wrong on this perception but I will still be ok. Robo Advisor platform maybe a new dimension of investment which seems much better, harder to be manipulated and we have more controls. Anyway i could be wrong but is first step in learning.

Cory

2021-0316

Articles in this Blog is personal take and educational purposes only. Reader should seek their own professional help when making financial decision and be responsible for their decision.

Cory Diary : Portfolio Updates

Recent adventure in US market is not good as tech starts to correct. Even though I was prepared that this could happen with mitigation strategy, the cost is still quite painful and feel timing ( fate ) could be better. With US treasury yield continues to rise, both bond and equity broadly are coming down the same time while mainly banks stocks move up. Stock and bond prices usually move in opposite directions. What will Fed do this time ? Nothing so far unless it spreads to destabilize the value market I feel. Tech stocks are in bubble territory so any correction to them is very welcome to Fed probably. 

My portfolio is now segmented into Bonds, SG Core, SG Reits and US Stocks. At this moment is lagging behind recovering STI index by a few percentage points as market moves to value while within Quality Reits get hammered. On dividend plan, the portfolio target annual dividend max of 55k is completed. ( Slightly higher than year 2020 in sustainable basis). I also build up a warchest of about 9% of invested portfolio value for quick deployment if needed. 

So with above in context, what's my take now ?

Bonds ( Orange )

With the recent maturity of CMT 3.08% bond, I am now left with 3 bonds. As previously mentioned, my plan is to have CPF be the "bond holding" of my portfolio and therefore this bond segment will be phased out and not be tracked in portfolio as CPF size will be expected to be large enough to skew the tracking of risk, yield or returns. However if I am to invest my CPF cash later, then they may return into the portfolio to be tracked. This transition phase could release more cash as I am limited on how much I could top-up my cash into CPF annually.

Reits ( Green )

Expanded to 9 Reits. Almost added Frasers Logistic and MLT but decided not as is still too expensive despite recent correction on quality reits. This is based mainly on yield/risk. I have a theory that the recent Reits volatility is due to flight of funds from strong reits who are competing with increasing bond yield. So at appropriate time maybe good time to scope this class of reits.

Elite, Cromwell and Aims Apac are considered higher risk in this Reit segment so their allocations are lower with higher yield. IReit however is allocated higher because I have AK backing. hahaha. This class of higher risk reits can do wonders to your dpu but occasionally "bad news" will strike them. Is important that we diversify to more of them and to filtered out similar or even riskier ones. So far exclusion list ESR, Sasseur Reit, First Reit, LMIR, Hospitality. Do note this article is not a thumb down on them but their uncomplement to my invested list. haha

Core ( Blue )

Sold OCBC recently to lock in profit as I feel there is enough DBS allocation to ride through the market. This also mean is much harder for me to sell DBS now considering it has been a strong balancer of losses in other segments this time round. I like SGX and Netlink a lot but there is limit of allocation which I do not want to over-expose to. One interesting stock is Sheng Siong which I am buying back at higher cost but at much smaller amount.

Recent adventure in US stocks ( Pink )

If we could remember I laid out a plan to invest in US stocks at a time when the market is quite high and was careful to make sure this is mitigated. I planned a 5 steps allocation approach to increase my allocated investment. The first step was implemented, and together with previous US shares not tracked earlier, constituted about 4.5% of my investment portfolio now. 

And then the US market starts to tank, and the whole process stopped at step 1 which is less than 5% of investment portfolio. If the 5 steps are done, I would have reached 25% allocated investment. Bad timing ..... on my diversification plan but it could be worst. I would hold them and see how far the correction goes. Being used to dividend investing, such volatile movement is something i need to learn. Some school fees need to be paid. Is a very good learning experience with skin in the game.

Chances are I will invest more into US market in the future. PLTR, Nvida, Appian, Amazon, FB are interesting list in-addition to existing.

Cheers

Cory

2021-0306

Articles in this Blog is personal take and educational purposes only. Reader should seek their own professional help when making financial decision and be responsible for their decision.