Cory Diary : Retirement Funds - Retire Series

Retirement is often viewed as the final chapter of one's career, and for many, the retirement package represents a significant financial milestone. This package can serve as a substantial boost to one's savings upon retirement, providing a sense of security and opportunity for investment. After careful consideration over several months, I have decided that my retirement funds will be allocated entirely into a War Chest—a strategic reserve for future investments.

Rationale Behind the War Chest

The primary reason for this decision is the current state of the market. We are already experiencing a bull market, which means that prices are generally rising. Entering this market with a large sum of cash could be illogical; instead, I believe it would be more prudent to wait for the next investment opportunity. Historically, markets operate in cycles, and while we are enjoying a bull phase now, it is inevitable that a downturn will follow. By holding off on immediate investments, I can position myself to take advantage of future opportunities when they arise.

In the meantime, I plan to distribute my funds into fixed-income instruments that prioritize capital preservation. Options such as Treasury bills (T-bills) are an excellent choice due to their low risk and government backing. T-bills provide a secure way to earn interest while ensuring that my principal investment remains intact. Additionally, other government-backed securities can offer similar safety and stability, making them ideal for retirees seeking to safeguard their capital.

Equity Portfolio Considerations

In addition to my War Chest strategy, I have allocated a significant portion of my net worth—approximately one-third—into equities. If the current bull market continues, this allocation could yield substantial returns. Investing in equities typically involves higher risk but also offers the potential for greater rewards compared to fixed-income investments. Therefore, maintaining a balanced approach between equities and fixed income is crucial for optimizing my retirement portfolio.

Managing Outstanding Loans

As an early retiree, I still have outstanding loans that need to be managed carefully. Having access to ready funding is essential in case of emergencies or unexpected expenses. This financial cushion allows me to navigate any potential challenges without compromising my long-term investment strategy or financial goals.

In conclusion, my retirement planning revolves around strategic decision-making focused on preserving capital while remaining poised for future investment opportunities. By establishing a War Chest and diversifying my portfolio across fixed-income instruments like T-bills and others, I aim to secure a stable financial future while being prepared for any challenges that may arise along the way. 

Cory Diary

2024-12-16

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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 : Allocation Strategies and Performance YTD

This is quick interim gauge on portfolio performance so far with less than a month to go before the year ended. It looks like the Market may end better by year end. We will know when it arrives. The update today is on how my allocation doing in term of seeking performance and mitigation.

Basically, Reit losses managed to be well coverd by US market gains despite US allocation is much smaller in size. US allocation was around 10% whereas SG Reit about 40%.

Another thing to know is that SG Market Non-Reit performs much weaker than US Market too. The star performer is SG Banks which gain pushes the bulk of this year-to-date performance largely for the portfolio. Quite a number of Influencers got this wrong even for so called experts.

My logic is simple for a retailer me. The Bank business is good. Lowering rate is good for economy therefore mitigate losses in net interest income of banks. The yield is still good enough. Being so obvious, i have allocated sizeable portion to this year portfolio to mitigate Reits impacts which i said few times that it take a long time for the rental contract to measure up despite lowering rate. 

Quite a few retailers I know in telegram groups did similar intuitively on Banks as well and this works so well for all of us this year.  I still think there is still some tailwinds but we never sure. So always stay nimble. So what went wrong with the experts. I think they overthink too much whereas I do not need to understand too much at macro level.

As a constant reminder, investment is personal and this is how i manage my risk and personal situation with my limited knowledge and understanding. Please dyodd.

Cory Diary

2024-12-07

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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 : Straits Times Index (STI)

Straits Times Index (STI) in Perspective

Coverage

The Straits Times Index (STI) represents the top 30 companies by market capitalization on the Singapore Exchange (SGX) Main Board that meet specific investability criteria.

Objective

The STI is designed to serve multiple purposes, including:

Creation of structured products.

Index tracking funds and exchange-traded funds (ETFs).

Use as a performance benchmark for investors.

Performance Overview

As of the latest data:

The YTD return for the STI is 18%, excluding dividends. In comparison, DBS Group Holdings has achieved a 49.5% return, excluding the impact of a 10% bonus share and dividends.

This performance indicates that investing directly in banks, particularly DBS, has yielded significantly better returns than the broader market represented by the STI this YTD.

Weightage of Index

The STI is calculated using a free-float market capitalization-weighted methodology, meaning that companies with higher market capitalizations have a greater influence on the index's performance. This approach ensures that the index accurately reflects the relative size and importance of each constituent stock within the Singaporean market.

Cory Diary

2024-12-05

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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 : Recent Trades

Banks

In recent days, bank stocks have experienced a notable rise. Following a recent round of rebalancing, I observed a directional split between DBS and OCBC. I took the opportunity to sell some DBS shares and reallocate to OCBC, which helped trim my oversized DBS allocation of over 26%. In my view, while DBS is still buoyed by share buybacks and is undergoing a CEO transition, this move serves as a mitigation strategy regarding the new CEO and aims to secure a larger dividend from OCBC. This is a defensive measure. I am still deliberating whether to allocate more fresh funds into this segment, which currently constitutes nearly 40% of my equity portfolio.

Sheng Siong

There appears to be a near-term peak based on the Relative Strength Index (RSI), alongside a positive trend in the Moving Average Convergence Divergence (MACD). Broadly speaking, recession fears seem to be subsiding. However, there has been slight awareness regarding losses in overseas operations, and yield has dropped to approximately 3.8%. Given these factors, I believe it is a prudent time to take profits while retaining only residual shares.

iBit

The recent spike in Bitcoin (BTC) has allowed me to redeploy funds into Google, which is currently under-invested in my portfolio. I have no emotional attachment to taking profits; my focus remains on prioritizing stocks with solid business fundamentals. I intend to return to iBit in the long term as I see it as an insurance component for my portfolio.

Additionally, I have made several minor adjustments in the portfolio regarding allocation and cleanup, which I have chosen not to detail here as they are relatively insignificant.

Cory Diary

2024-12-04

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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.