Mar 6, 2021

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.


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.