May 19, 2023

Cory Diary : Navigating Crisis - Net Worth

The COVID-19 pandemic brought forth unprecedented challenges, impacting economies and individuals' net worth worldwide. As I reflect on my own financial journey, I can't help but recognize the profound influence of property value increases, strategic investments, regular income, and the responsibilities of parenthood on my net worth during this crisis. In this article, I will share my experience and highlight the significance of these factors in shaping my financial well-being.

Real Estate Market Challenges and Surprising Property Value Increases:
Like many others, I faced uncertainty during the pandemic, particularly in the real estate market. However, amidst these challenges, a remarkable trend emerged - property value increases. As I owned residential properties in desirable locations, I witnessed firsthand the unexpected appreciation in property values. This surge greatly contributed to the improvement of my net worth, as individuals sought larger living spaces and took advantage of favorable mortgage rates during the crisis.

Mitigating Volatility through Diversification:
Diversification played a pivotal role in safeguarding my net worth amidst market volatility. By diversifying my investment portfolio across various asset classes, including real estate, stocks, and bonds, I minimized the impact of losses in one sector while benefiting from the property value appreciation in another. This strategic approach not only stabilized my net worth but also provided me with opportunities for growth during uncertain times.

Cash Reserves, Emergency Funds, and Regular Income:
Another crucial aspect of protecting and growing my net worth was maintaining adequate cash reserves and emergency funds. The availability of liquid assets provided me with a safety net, enabling me to handle unexpected expenses, job instability, or business disruptions caused by the pandemic. However, it is important to note that regular income from salary played a significant role as well. Despite the challenges in the job market, having a stable source of income allowed me to maintain financial stability and meet my ongoing expenses. The combination of regular income and strategic investments helped offset any stagnant growth in non-productive assets, ensuring a positive net worth trend.

Parenthood: Balancing Expenses and Prioritizing Future Security:
Over the past four years, the addition of two children to my family significantly impacted my overall expenses. The responsibilities and costs associated with raising children, including healthcare, education, and daily essentials, necessitated careful financial planning. While these expenses undoubtedly had an impact on my net worth, they also brought immeasurable joy and fulfillment. It became imperative to strike a balance between providing for my children's needs and ensuring long-term financial security.

Adjusting Financial Strategies and Priorities:
Parenthood prompted me to reevaluate my financial strategies and priorities. I became more focused on building a solid financial foundation for my children's future. This involved adjusting my investment portfolio to include long-term savings and education funds. While these changes may have temporarily slowed down the growth of my net worth, they provided a sense of security and peace of mind, knowing that I was taking the necessary steps to provide for my family's future.

The COVID-19 pandemic presented significant challenges to net worth growth, with stock market volatility and stagnant growth in various sectors. However, my journey taught me that property value increases, strategic investments, regular income from salary, and the responsibilities of parenthood all played pivotal roles in shaping my net worth during this crisis. By owning residential properties in desirable locations, I experienced firsthand the positive impact of property value appreciation. Diversifying my investments across asset classes, maintaining cash reserves, and having a stable source of income further fortified my net worth.

Parenthood brought increased expenses and prompted adjustments to my overall financial strategy. The costs associated with raising children, such as childcare, education, healthcare, and daily necessities, added a significant burden to my monthly budget. However, I recognized the importance of prioritizing my children's well-being and future prospects.

To manage these increased expenses, I implemented several strategies. First, I carefully reviewed my budget and identified areas where I could make savings without compromising the quality of our lifestyle. This involved cutting back on discretionary spending, negotiating better deals on necessary expenses, and seeking out cost-effective alternatives.

Additionally, I explored other financial instruments that could potentially benefit my children's future. I researched and invested in low-risk investment options that would gradually accumulate value over time. This approach not only allowed me to grow my net worth but also provided a source of funds that could be tapped into when necessary, such as for college tuition or other major expenses.

In conclusion, the COVID-19 crisis has highlighted the importance of various factors in shaping my net worth. Property value increases, strategic investments, regular income from salary, and the responsibilities of parenthood have all played instrumental roles in my financial journey. While facing challenges, such as stagnant growth in non-productive assets and increased expenses due to raising children, I have learned to adapt, adjust my strategies, and prioritize long-term financial security. Through careful planning, diversification, and a focus on both short-term stability and long-term growth, I have been able to navigate these uncertain times and continue on a positive net worth trend.


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

May 13, 2023

Cory Diary : iReit Review

During a recent conversation on Telegram, someone asked me about the risks associated with iReit Global, a Singapore-listed Real Estate Investment Trust that invests in income-producing properties in Europe. While I had previously done some due diligence on the investment, I had put it aside and couldn't remember when. However, in today's economic climate, debt management is more critical than ever due to rising interest rates. While not all REITs have felt the full impact yet, those that have will likely need to weather the effects for several more quarters.

Fortunately, iReit Global's management has taken steps to mitigate risks, as shown in a slide shared by the company. They have identified and addressed risks such as interest rate risk, refinancing risk, and concentration risk. However, it's important to note that all investments carry some level of risk, and forex risk, in particular, may impact the REIT's earnings as it is listed on the local exchange and the SGD has appreciated by approximately 7-10%.

The COVID-19 pandemic has also impacted the real estate market, including the office segment where demand has decreased. While this may affect iReit Global's portfolio, it's important to note that their properties are located in Europe, where the situation may differ from other regions. 

Overall, iReit Global may be a suitable investment for those seeking exposure to European real estate, but it's important to consider the risks and monitor the REIT's performance regularly. It may be helpful to seek the advice of a financial professional to determine if this investment aligns with your investment goals and risk tolerance.


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May 6, 2023

Cory Diary : Property Curbs

Investing in property in Singapore has been a popular choice for retirement planning due to the rental income and capital appreciation it can provide over the long term. However, it's important to recognize that past trends and government policies do not necessarily guarantee future performance.

An analogy that can be used is that of a kettle whistle. When the pressure in the kettle gets too high, the whistle sounds, and the heat is lowered to prevent the water from boiling over. However, over time, more energy is added to the kettle, and it will boil again. This is similar to how government cooling measures can temporarily slow down the real estate market, but economic conditions, population growth, and consumer preferences can impact the market over the long term.

Personal experiences with property investment can vary. For instance, I have an investment property that I purchased more than a decade ago when the government introduced curbs. In addition to the possible rental income, the capital appreciation of my property has probably resulted in strong 6 digits in capital gain excluding costs.

However, it's worth noting that the current state of the market may not be ideal for investment. The Singapore Property Index, which tracks the performance of the residential, commercial, and industrial sectors of the real estate market, has risen significantly in recent years. While past performance does not guarantee future success, the high market prices suggest that property investment in Singapore may be more challenging than in previous years.

While property investment can provide benefits, it's important to consider the risks involved. There are costs involved in maintaining and managing a property, and rental income and capital appreciation are not guaranteed. Additionally, factors such as location, property type, and market trends can impact the performance of an investment.

In conclusion, property investment can be a viable option for retirement planning in Singapore, but it's important to approach it with a clear understanding of the risks and considerations involved. The kettle whistle analogy highlights the temporary nature of government cooling measures, but it's important to research the market, consider the risks, and make informed decisions based on your individual circumstances and experiences. While past performance and personal experiences can provide valuable insight, it's also important to consider the current state of the market and whether it may be too high to invest in.


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May 2, 2023

Cory Diary : Equity Portfolio - Rate Spike Readiness

As I review my portfolio recently, there are quite a few changes that I would like to share. First, I presented a customized radar chart to help me visualize the performance of each stock. However, if you find it hard to understand, you can skip it and go straight into the highlights of each stock that I am interested in. 

As an investor, I recently made some changes to my portfolio that I'd like to discuss. Firstly, I decided to sell all my shares in Mapletree PanAsia Com Tr. Although I had a net positive return after 5 years of investing, I wasn't happy with the company's recent merger and management's actions. Additionally, the mall asset in Hong Kong is performing poorly, which doesn't bode well for the company. Given the current macroeconomic situation in Hong Kong, I felt it was time to move on and raise some cash.

On the other hand, I've decided to build a new position in Mapletree Log Tr. Although the macroeconomic headwinds make me unsure about investing in logistics, this company has a strong track record and is likely to do better than its peers. The investible REITs market in Singapore is also quite limited, especially with the recent high-interest-rate environment. As a result, I'm prioritizing debt management for any new investments I make.

Mapletree Log Tr's total debt as of March 31, 2023, is S$4,877 million, which is slightly lower than the previous year. Although the weighted average annualized interest rate has increased slightly from 2.2% to 2.7% over the past year, the company's interest cover ratio of 4.0 times is still relatively healthy, indicating it has sufficient operating income to cover its interest expense. However, the adjusted interest cover ratio has decreased from 4.2 times in the previous year to 3.5 times in 2023. Overall, the company's debt level and leverage ratio seem manageable.

The company has taken steps to manage interest rate risk, with 84% of its total debt hedged or drawn in fixed rates. Every potential 25 bps increase in base rates1 may result in ~S$0.49m decrease in distributable income or -0.01 cents in DPU per quarter. Additionally, about 77% of the amount distributable in the next 12 months is hedged into or derived in SGD, mitigating forex risk.

Moving on to my stock holdings, I've added to my stake in Microsoft incrementally. While I used to think that we couldn't do without Google search, I've recently been impressed with ChatGPT and have reduced my usage of Google search. The recent acquisition of Blizzard further boosted the stock price, although it remains to be seen if this will help Microsoft. Nonetheless, I've learned that it pays to wait when investing in growth stocks, given their volatility.

I've also secured a position in OCBC to balance my portfolio's REITs exposure, as my portfolio currently has DBS as its top position. While UOB is also an option, I found  OCBC's yield more attractive. All three banks are currently in a strong position, but we have to be mindful that their P/B ratios aren't cheap. Thus, I don't plan to add a significant stake immediately to rival the top 5 positions of my portfolio. As I focus annually on building up my dividend size, I'll be diligent in my investment choices. Currently, OCBC's management is flexible on future dividends, which means that the recent dividend may be volatile depending on the business.

Next, Sabana Reit has been performing well under the current management, delivering good returns. However, given its small size, it may be prone to volatility. The latest report shows that the Reit's returns may be negatively affected by a spike in interest rates. Therefore, a significant portion of the portfolio position was sold. If the high rates persist and the impact is not fully reflected, the next report could be negative too. As a result, the decision was made to take profits when good opportunities arose. 

Capitaland Ascott Trust

Finally, I've initiated a position in Capitaland Ascott Trust, which appears to be a well-managed REIT with a diversified portfolio of properties across multiple geographies and solid capital management position. As with my other investments, I'm prioritizing debt management in this position as well.

I've also made some adjustments to my stock holdings by trimming the top positions of Ascendas and FCT to achieve adequate diversification at the current portfolio size.

Please note that this is not financial advice, and I encourage you to do your own research before making any investment decisions.