Cory Diary : Mapletree Log Trust Review

This post will be a start of my quick review on each Reit stock I am holding for this earning season results. The intent is to be my notes.

1QFY23

FIRST QUARTER ENDED 

30 JUNE 2023

YoY 3.1% reduction in NPI reflecting in YoY 13.4% increase in borrowing cost and foreign exchange. Into the mix is host of forex considerations and financial derivatives between the YoY comparison including perp, tax write back etc. Large gap if we look into operation return is -24.1% YoY. In net, there is higher distribution due to capital returns as well that tip it into higher distribution this Q. DPU flat. Trying to go through the Quarterly report is quite daunting tasks.

To simplified my perception, the DPU looks ok though not as high as Ascendas, MIT etc. There is PP/PO and there will be slight reduction in DPU assuming all else being equal which is typically not in every new quarter reporting.

In summary this is what I got into below table.

There are enough Pro to provide conditions to manage debt and high interest rate/hike. The yield is ok based on the DPU. There could be forex risk from China & HK combined. Not saying JPN and other developing economies won't. 

The comparison QoQ and YoY, tells me the business impact stabilizing this Q compared to previous Quarters.

Finally, the DPU may move up/down due to capital gains, issue unit etc however I feel we should not see significant move down more than 3~5% with the recovery, new divestments and acquisitions. This is up to the manager to manage them to ensure we stay above. A hallmark of quality manager which they are usually. We shall monitor.

Cory

2023-0731

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Disclaimer: The articles presented in this blog reflect personal opinions and are intended for informational and sharing purposes only. Not responsible of errors. Readers are advised to seek professional guidance when making financial decisions and should take full responsibility for their choices.

Cory Diary : Reflections on the US Market and Singapore Investments

US Market ( Nasdaq )

In recent times, the US market, specifically Nasdaq, seems to have completed a significant run-up. Despite Tesla showing decent growth results, it experienced a correction on the second day. This reminds us that the market will always find a reason to sell. Microsoft also followed suit with lower volatility. Looking at the three-year performance of just these two US stocks, it appears that I am almost breakeven, with only a modest 15k gain if I were to consider all US shares held during the past three years. This experience has taught me that growing out of dividend plays in the SGX market is not as easy as it seems. Timing plays a crucial role in the US market, and its wild volatility can lead to valuation fluctuations with each reporting or news release. Consequently, it is wise to avoid chasing stocks, especially when there are no or little dividend gains for holding them long-term.

Singapore Market

On the other hand, Singapore banks have experienced some revival due to recent Fed hawkishness, balancing out the hits on Reits. I have observed that the recent rights issue on iReit and Aims Apac Reit have been profitable, but the discounts are not as substantial as in previous years, resulting in less impressive gains. My current allocation is as shown above, with some USD cash remaining from earlier sales. Given the current lower US rate, I am undecided on whether to hold it until the next bottom cycle and park it in a high-interest rate account or convert it back to S$.

As I review my equity portfolio, it is becoming harder to rotate stocks, particularly since Fed rate hikes may have already peaked. The sell-off in Reits, however, presents a promising opportunity for investors as we could see significant capital gains alongside regular dividends in the future. I plan to maintain a cash reserve for the last one or two rate hikes or potential recession sell-offs, if any. This strategy could lead to another record-level annual dividend, and the opportunity is quite apparent.

Passive Income Reporting

Additionally, I've noticed a new trend in my financial planning that better suits me. I have shifted away from reporting Net Worth Pie Chart segment allocations to focus on Passive Returns ( Non-Salary based returns or other returns). This change comes from the realization that using asset methodology doesn't directly help me with my expenses. However tracking Passive Income gives me a gauge on income once I retire. Currently reporting excludes my partner.

Using the listed amount in the table, I have a good idea how they fit into my expenses. And how much I need to grow or control.

In the past three months, I have invested more into T-Bills, primarily adding an additional $2,350. There was also a slight increase in my CPF investments, though I am cautious about doing so since I am nearing 55 to fit my personal plan. I've learned to avoid this unless there is a significant boost in cash levels from an euphoric market. Please note that CPF is not tracked in this table and is currently treated as a bonus retirement amount at 65.

While there have been upticks in equity dividends from rights issues, I've sacrificed a significant amount of cash for safer investment allocations in the past three months. Currently, I am monitoring my cash levels carefully to ensure my T-Bills are adequately spread out to support property loans or meet any cash needs comfortably.

Overall, my experiences in the US market and the shifts in my investment approach have provided valuable lessons, which I hope will continue to guide my financial decisions moving forward

Cory

2023-0724

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Disclaimer: The articles presented in this blog reflect personal opinions and are intended for informational and sharing purposes only. Readers are advised to seek professional guidance when making financial decisions and should take full responsibility for their choices.

Cory Diary : Managing Volatility Emotion

Managing Emotion

Emotions can have a detrimental effect on average investors who have worked hard to build up their portfolios over a lifetime. These investors typically have a monthly income ranging from $4,000 to $6,000. Through frugality, investments, and perhaps even inheritance, they may have accumulated a million-dollar portfolio after 30 years of employment.

However, when the global financial market experiences a downturn, these investors can face significant drawdowns, sometimes as much as 50%. This means that they could see half of their lifetime of effort evaporate, or $500,000 vanish into thin air. When portfolios experience such losses, it can be financially devastating if investors are unable to maintain their composure. Assuming the fundamentals of the portfolio remain intact, realizing these losses can be detrimental to one's financial well-being.

To manage these challenges, diversification becomes crucial. I personally employ a diversified portfolio consisting of property, stocks from SGX/US markets ( 15 - 20 stocks ), pensions, SSB/T-Bills/FD, as well as funds in my Multiplier and investment accounts. Throughout my investment journey, I make adjustments to the allocation of these assets to effectively manage my emotions and, hopefully, improve my ability to overcome them.

Successfully managing emotions allows me to adopt an investment mindset even when the market is experiencing a drawdown. This mindset enables me to seize investment opportunities. It is important to be mentally prepared for such scenarios and be willing to make necessary adjustments.

Conversely, during bullish market conditions, it may be prudent for me to accumulate cash reserves, known as a "warchest," if the need arises.

In conclusion, I wanted to share these insights to encourage thoughtful reflection. Cheers to overcoming the Monday blues!

Cory

2023-0717

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Disclaimer: The articles presented in this blog reflect personal opinions and are intended for informational and sharing purposes only. Readers are advised to seek professional guidance when making financial decisions and should take full responsibility for their choices.

Cory Diary : 1st Half 2023 Dividend

As we reach the halfway point of 2023, it's time to assess our dividend performance. Over the past few months, we have seen several REITs issuing private placements or rights issues, which has resulted in some of the REIT dividends being pulled into the first half of the year. Consequently, we can expect a lower score in the second half.

Note : Duel Scale Chart

Despite this, the overall dividend performance has reached a new high. I have recently subscribed to shares in Aim Apac and plan to do the same for iReit. Year-to-date, the portfolio has achieved a return of over 7% XIRR, mainly driven by the rebound in stocks such as Tesla, Microsoft, and REITs. However, looking at a two-year perspective, the foreign REITs listed on SGX in the portfolio have not performed as well, and their dividends have fallen short. One of the key reasons behind this is the strength of the Singapore dollar and the decline in office property values in those countries.

Cory

2023-0701

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Disclaimer: The articles presented in this blog reflect personal opinions and are intended for informational and sharing purposes only. Readers are advised to seek professional guidance when making financial decisions and should take full responsibility for their choices.