Apr 1, 2022

Cory Diary : Performance Q1'2022

Performance Q1 2022 ( +1.9% YTD )

In Q1 2022 we see significant run up in STI index due to Banking sector which is similar to what happen in Q2 2021. However Year 2021 performance manages to catch up significantly which ended the year in good positive notes. ( see link ).  As we move near to end of Q1'2022, the portfolio managed to end in positive territory with a smaller gap against STI Index. And end up with Positive 1.9% YTD.

Cory XIRR 1.9% vs STI 9.1% YTD


Dividends ( Equity )

Dividends for Q1'2022, $ 16,282 which implied monthly average of $ 5427. The current annual target is $64k. There is no surprise so far and is per expectation. Continuously looking for way to further increase the dividends by making idle cash more efficient from other pockets of the net worth.


Tesla

If we do comparison below between STI (Pink), Tesla (Blue), DJIA(Green) and Nasdaq (Red) on YTD, Tesla has a good run up in the last 2 weeks after falling behind for months. This shown again ability to hold through volatility is critical to profit in US market for stock that we have conviction in and shown to show strong business fundamental.




Tesla currently has 13% allocation in the equity portfolio after reducing the position 3 times and because the volatility still too high. Tesla still occupies top position in stock allocation despite that.


Reits

Have a nice recovery across a number of Reits in the portfolio. Even MCT registered a small loss after averaging down and hitting 5 digits negative when they first announced the merger. At 5% plus yield across many of the branded Reits they are still quite attractive for long term planning. FCT also stage a strong rebound with reducing Covid measures.


Wilmar

Just initiated a small stake in this commodity company. Hopefully not a painful lesson fee.




Cory
2022-0401

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Mar 31, 2022

Cory Diary : Tracking a counter trading information

Often we rely on broker apps to track trading information. For me I like to have key information all in a page that I can work with on my notebook with what i needs in excel. This give me a good view o how to plan and be successful in managing my portfolio.



This counter is in a group page. As you can see, only Microsoft as they are grouped by counter. Won't be going through the details. Basically it track forex, initial cost, cash holding type when sold, YTD P/L, Lifetime P/L, average cost YTD, Profit yield by XIRR or Initial cost depending on situation, each transaction and corporate action, recent dividend history, profit types etc ...

The good thing about in excel setup is that we can change the format as we wish and link them to multiple sheets for automation for charting, net worth etc. I also use this to cross check broker settlement information and cashflow. The whole setup is simple as it uses standard excel functionality.



Cory
2022-0331

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Mar 24, 2022

Cory Diary : Equity Allocation 2022-0324

Market continues to be volatile but appears Tesla most pressing task which is Giga Berlin finally is opened for business. Probably thanks to Ukraine War, the need for energy saving car like EV has becomes a priority for Germany. This help to swing the US segment back up significantly as this help protect projected Growth of Tesla beyond 2023 in-addition to Giga Texas. 



Next as mentioned in previous article, finally cleared off the baba stock which is less than 1% of the portfolio at a loss. This close[d a chapter on my excursion with Chinese company. No plan to return near term despite recovering market and this restricted total foreign stock allocation to only 11.2%.

Banking wise managed to increase to 4.9% from 3.3% allocation in Nov'21 ( link ). Want to be careful here due to elevated price of the banks compared to a year ago. Window of opportunity seems to have closed as Fed is getting hawkish on rate increase.

Portfolio improved significantly this week and now less than -1% down YTD. In comparison to STI index basically similar story as in 2021 due to large run-up of the banks. Dividend projection is now $63k in which there are 6.8% war chest available from investment accounts.


This are the key highlights.


Cory
2022-0323

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Mar 18, 2022

Cory Diary : Asset Allocation Update 2022-0318


The buzzword this month is STAGFLATION. Per Google, persistent high inflation combined with high unemployment and stagnant demand in a country's economy. Interesting there aren't high unemployment yet mixed with Great Resignation Wave which is kind of a pull event. Interestingly inflation is up due to supply issue of Covid with added dimension due to Ukraine War on Oil & Gas. Raising rate quickly will not be going to help much instead cost more to service the debts.

What's this implied is they are two separate problem and when it is conflicting, is there alternative or to focus on one first. Inflation hits all whereas unemployment hits on unemployed. Since there aren't significant unemployment the focus will likely be inflation and this could mean persistent rate rise in gradual manner such that we do not wake up the unemployed monster. Well, the Fed could still increase the pace if they have confidence that we are far from it. However it seems inflation is unavoidable just mitigate. From yesterday Fed decision on 25 bps hike this implied is better to have higher inflation than recession which kind of make sense. The market rally. This is a critical milestone and I feel is the right decision to support incremental changes.

Few key changes reflected into the Pie Chart. Firstly exercised some of company share awards. This has been valued zero in net worth. Have been doing this exercising routine so that in the event of unexpected this sizeable amount will not be in limbo. The increased cash expanded the Fixed Deposit allocation.

Secondly, the investment Account reduced some by actions to max out Multiplier allocation this month for 3% target. This stream of additional income gained traction hitting 2% for last month. Not a lot but this help to build up low risk segment of the portfolio and allows me to sleep well.




On Equity side portfolio year to date is down 2.8% (updated end of market US time). Decided to sell remaining baba shares just a day before it gallops down again therefore zero investment in china now. The Chinese Tech stocks have  huge rally this 2 days but I won't be entering back due to lack of conviction. This will fill some war chest as some funds have been used to raise bank allocation to 6.7% for a more balance portfolio. Is clear that we cannot ignore to have some stake in the bank despite digital banking risk.

On the property investment side there is increment increase in the $psf transaction but as the volume is low decided not to reflect into the net worth. Rental market do see sizeable increase in rent which seems to indicate genuine demand for housing after the last curb on property. So any further increase in ABSD or TDSR seems punishing people who really needs them. 

CPF has grown some after doing another round of top-up to max out CPF allocation. This 2 years are important for my age because SA allocation is at it's highest through VC3AC process. The only top up possible now VCMA or Child CPFs. I think there is no hurry considering there can be good opportunity in the market which has been lows for some periods.

Lastly, with the significant increase in FD/Multiplier segment, I should start to plan to reduce my saving cash. We will see if the investment cash runs out.


Cheers,

Cory
2022-0318


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Mar 13, 2022

Cory Diary : How long will Ukraine War last ?

What is the scenario where everything can go wrong in an Invasion ?
We probably can see it in this Ukraine War.

Russian armoured column fleeing after a few hits



United

Putin managed to unite OTHERS. ( Sarcastic )

EU is United
US Democrats and Republicans are United
Ukraine is United


Crumbling Economic Sanctions on Russia

Germany Freeze new oil pipeline from Russia indefinitely
Ukraine received thousands of advanced Anti-Tank and Anti-Air Weapons from many countries
Russia under significant economic sanction from many governments and private sectors
EU agreed to allow Ukraine to join
Russian oligarchs asset frozen
Russia Oversea fund freezes for war reparation
Foreign companies pulling out of Russia
Russian Citizens in foreign countries in Europe were discriminated
Facebook, YouTube, Twitter, Paypal Blocked in Russia


Observed

Russia military equipment are quite old
Russia military supply lines are cut
Russia units are not fighting as a force
Many bombs hit civilians targets
Significant air, armor and personnel losses just in 2 weeks
Russian soldiers are poorly equipped and poor morale
Dirty strategy of attacking civilians are well documented


Communication Devices

First time Star-link enabled to support Ukraine. Never before in a war.
Many footages of the war are captured by mobile phones showing many casualties of Russian Aircrafts, tanks and soldiers.
A lot of Propaganda on both sides

This War can end quickly but will this be a wasted opportunity ?


Cory
2022-0313


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Mar 2, 2022

Cory Diary : Russian invasion of Ukraine - Elite Comm Reit

Ukraine has more than 200k servicemen. For Russia with their military power and size to send less than this number of soldier to invade Ukraine, and splitting their army into three routes seems arrogance resulting them failing their military goals so far. And now with Ukraine activating reservists it seems tough for Russia to fight without significant loss of lives even if they win. Putin has started to use cluster bombs, hitting government building with missiles and deploying thermobaric weapons seem steps of desperation. This will be horrific to Ukraine Civilians as such weapons are indiscriminate and a serious war crime. I wonder which soldiers will obey such orders to kill civilians senselessly in this modern time. Even if Russia win is a lose.

Interestingly, the invasion also resulted in 10 Yr bond yield crushing back to Jan level as people rush for safe assets. Reits started to rebound despite Inflation reeling hard. USD creeping up too. The bank prices that have been spiking past months have already entered discount modes. This allow me to kickstart collection but seems I am a little too eager as my position has increased to more than 5% of the Equity Portfolio. I need to hold my gun tighter when the probability or rate increase likely to be strong ?


So how is Europe Properties impacted or mitigated ?


Elite Commercial Trust

Regearing announced. There is some rent reduction in 11 of the 100 properties. A huge relieve to shareholders as they are now extended to year 2028.



"Together with the 31.6% of the total portfolio by GRI currently with straight leases through to 2028 with no lease break options, this means that 78.6% of the leases by total portfolio by GRI(1) will run straight to 2028 without any lease break options"

However there is also some investment required as follow. This could improve the valuation of the properties such that dividend will not take significant hit over the 3 years period if they go via additional loan.


The only risk left which I am personally concern is exchange rate risk on DPU nevertheless is a good deal overall.



Cheers,

Cory
2022-0302


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Feb 18, 2022

Cory Diary : Making Sense the Risks and Multiples

Mentioned this long ago but thought it is best to write about it again. Often we hear about sensational returns of 10,000 Multiple returns. Below is the Scenarios on the amount invested.


 
Using the Profitable Scenarios on the top, if one has adjusted the risk to be small with small amount invested and achieved 10,000% returns using $0.20 entry price compared to one who invested later at 10 times the price after the company stock price run up midway. We will realise that the later investor has 18x more profit. This is due to the amount of shares bought is 20 times for $2 each.

If an even later investor came in to buy at $10, the absolute profit is $1K. Not too bad interestingly. The first investor can whistle his 10 thousand times profits but is just $99 in reality. A waste of time.
 
Like wise, in Loss Scenario, the opposite follows too.


The Power of Punch Matters and so are the Risks


Cheers,

Cory
2022-0218


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Feb 14, 2022

Cory Diary : Equity Allocation Feb'22

Market has been volatile so far in Year 2022. For SG markets continues to be weakened except for SG Banks which incidentally driven up the STI Index despite the broad market weakness. This has been consistently played out for 2 years already. US Nasdaq market corrected some as Market is trading with possible 7 rate hikes. China has done some rates cut instead which is quite interesting.

In the background fighting for attention is Putin who has been devising a possible invasion into Ukraine. Interestingly Russian soldiers have been there since "Day 1" when the eastern provinces rebelled many years ago. Battle ground info has consistently shown Russian Soldiers in disguise as rebels. The Black Swan will be occupying the entire country. Steep sanction faces Russian people for many years to come if Putin decided to do this. Seems unlikely they can take out Ukraine with 100k troops.



Note : Chart is for reference and yield computation is updated per my best knowledge and personal computation method.


PORTFOLIO

At this time, Potential dividend for Year 2022 will hit $65k. Investment fund reduced to around 7%. Has been doing small purchases as the market goes down.  Concurrently, started a new stream of income from Multipliers. Expects to hit 2% for whole year based on current rules. Working to get to Max 3%. The good thing about this new account is that it can double up as emergency fund while providing higher returns than fixed deposits and same time reducing need for ready cash as it can be move around the accounts if really needed.


DBS

Will DBS continue their rise when digital banking started ? My guess is dependent on CEO. And therefore bet is still on DBS despite my reducing position. DBS ability to maintain margin unsure considering we have many fintech starts-up which will compete with traditional banking. Holding my remaining shares tightly for now in recognition of the coming disruptions.


TESLA

Some weakness has been going on with Tech stocks including Tesla. I guess investors still waiting for Giga Berlin to happen which is hampered by Germany Bureaucracy. Is smart for Tesla to expand Giga Shanghai and getting Giga Texas to roll up to support the needed capacity for Year 2022. However the growth is so large that Tesla will likely need newer sites to support increasing demands beyond.

On risk exposure front, 11.6% of Equity Portfolio and much smaller on Net worth around 5%. This is a calculated bet that it will support future asset growth for next couple of years considering the multiple S-Curve potentials.


MICROSOFT

Make it to return to the portfolio from recent weakness. The stock has strong moat and consistently profitable returns under the current CEO. The acquisition of Blizzard Activation in my personal opinion is a good synergy and cut short the lead time needed into "Metaverse". Gaming environment already has such features for many years which has it's own trading currency, mailing systems and groups chat communications in-addition to voice chat capability. The world within such games are enormous and beautiful with enchanting Music. The last leg will be enabling linkages to real world, bandwidth and 3D Visualization capability.


DAIWA HOUSE LOGISITIC

The latest report increase in valuation of their properties. Their gearing reduced significantly allying my fear on the reit gearing. Currently allocation is 7.3% of Equity Portfolio.






Cory
2022-0214


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Feb 6, 2022

Cory Diary : Danger of S&P500 Index

The S&P 500 is littered with many instances of long period of down time where investor hold on to zero to very low yield stocks for many years. Examples below on most recent ones.

First Picture is 6 years wait.


Your wait will be extended by another 7 years if you buy in Year 2000 peak.



That's total of 13 years and with only a little profits. Not sure will there be after currency exchange rate ?

For this number of years in Dividend investing stocks, an investor has good chance to double their returns assuming just 5% yield. Currently Market is trading 5.5% yield for strong reits. Not saying S&P500 will repeat this stunt. Just to highlight the danger. Maybe one should DCA or do proper diversifications. Maybe stock picking is a good idea ? The index is still cool. Just be aware what we are walking into as not many can wait even for 3 years.

Pls DYODD

Cory
2022-0206


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Jan 29, 2022

Cory Diary : Tesla Q4'21 Earning Call

The call basically is funny. Elon being himself like an engineer do not want to say what the analysts want to hear. They were looking for roadmap and near term but he talking production issues, no CyberTruck, and then he go on with his vision of FSD, RoboTaxi, Humanoid .... haha

Here's a quick summary and what he meant I believe in his calls.



Highest operating margin in the industry. Another Gross Margin High and Production High despite continue Supply chain constraints. And this will continues to Year 2022. This shake those analysts who register a big issue. But to Elon he has same issue in 2021 too and we have record quarters. The fact of matter is Elon expects 50% growth in Year 2022. I think likely more. Even at 50% this is phenomenon growth and profits for year 2022. And this can be met by Fremont and Shanghai Giga factories alone since is still under utilized due to supply chain issue which every company in the world facing too. 

And to Elon minds because of part shortages and super high demand in Model 3 and Model Y, why the heck we need a roadmap or Cyber Truck at all. No additional Model needs to be delivered as it does not make sense since not enough parts even to meet current demand. This is super bull case for supply chain management.  New model needs new expensive production tool, factory learning and will be taking away parts from M3 and MY. Total output will decrease if they focus on new vehicles. He will have new models RD ready if production needed.

Texas and Berlin started production last Q. Focus now on volume production. New factory towards end of this year. To me this is like bonus. If world wide supply chain improves, bang ! we going to have a super quarter.

He aren't doing 25k compact car. Which is quite obvious. Parts are critical now. Why on earth we want to put them in a cheap product. Certainly this going to premium cars for better margins.

Elon expects FSD this year. Maybe possible. He then talked about future robot products. I think this is his hope not immediate future. He even go on about Humanoid. Personally I find it impossible to achieve even in next 5 to 10 years. Is more like a smokescreen. This aren't important unless we set our price target that we invest today is $10k ....


And for the PE matters. It has dropped to PE 83 @ $850. This is using very conservative estimate of  annualized non-growing numbers which is 850/2.54 x 4. Super quarter Tesla riding on cash cow train.

Elon being Elon do what's matter logically. That's why he is the world richest man incidentally and able to do mission impossible in SpaceX.


Cory
2022-0129


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Jan 27, 2022

Cory Diary : MIT 3QFY21/22 Read

Mapletree Industrial Trust return has been consistent for many years. DPU Up and Up except when ... . Is not surprising that investors expect 3QFY21/22 to be Up as well. Glad there is no disappointment. See below table. Due to it's consistency, annualizing it's latest Q result DPU will gives a good projection for the year yield at minimum. Of-course there's always exception and therefore not guaranteed. Another reason I like this Reit is that it gives quarterly dividend.



At today closing price, yield is at 5.35% which looks sustainable. Further supported by resumption of distribution reinvestment plan to help fund progressive needs of development projects. Occupancy at 93.6%. Gearing at 39.9% which mean possibility of right issue will still be there.

It has respectable adjusted ICR of 5.9 times thanks to almost 50% of the Reits are in NA DCs and which has much longer WALE. Singapore Operation is stable and decent.

One thing to note is this "On 11 May 2021, MIT issued S$300.0 million of fixed rate perpetual securities. The perpetual securities, net of issuance costs, are classified and recognised as equity instruments." . Roughly 10% of the Reit borrowing IIRC and which the perpetual is included in the Adjusted ICR.


How good is this Reit to me ?

The Power of this Reit = EPU % + Yield % = 5.7% + 5.35% = 11.05%. An unorthodox way of benching up a reit ability. The Power is only meaningful if  the earning and dividends are sustainable in absolute using number of shares as denominator. A modification to Reit due to property valuation can be volatile is to use NPI. Therefore Reit Power = NPI % + Yield % = 13.1% + 5.35% = 18.45%. This is the first time we do this. Let see how other Reits perform against it in future articles.


This MIT Reit Rocks so far but it need not be forever considering how MCT is treated.

Please DYODD on all the information and thoughts.


Ok ! Back to House Chores again.

Cory

2022-0127

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Jan 26, 2022

Cory Diary : FCT 1Q22 Read

This is a post which I decided to do quickly from today FCT business updates result. Not surprisingly Rural Malls are our way of life and the crowds are back. Below is excellent matrix which possibly hints good increase in profitability.



Do note that "The interest coverage ratio is a debt and profitability ratio used to determine how easily a company can pay interest on its outstanding debt. The interest coverage ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expense during a given period."



Sales has a new break through and Occupancy at 97.2%.


Looks like my Stake in FCT is still good and safe. In fact getting stronger.

Ok ! Back to House Chores ...

Cory

2022-0126

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Jan 16, 2022

Cory Diary : Investment Allocation Updates

It has been a year since foraying into Growth Stocks. The journey last year has been nothing but exciting for a dividend investor. The Growth/Tech stocks have gone up and down in numbers. Currently only holding mainly on Tesla with a little in Alibaba. Taking a snapshot of today allocation as Tesla will be communicating the Q4 result in about 1 week. The shipment number has been very strong so far. Relative to entire portfolio, US Growth Stock is less than 10%. I think this has reach a limit on how much I can go on this segment as it is highly concentrated in Tesla.



The portfolio is still mainly Reits occupying almost 50% generating about 62K-65k dividends annually spread across 8 counters. The current yield of the portfolio is about 4.6% excluding CPF and Gov Security. CPF is about 16% and is tracked here as it has been growing to replace the corporate bond segment.

The bank has been gradually reducing in stages. Right now only left 2.2%. Hopefully I have the opportunity to build back to reasonable level. Currently investment account cash level has risen to 13% of the portfolio. There is no additional injection so far this year as I have move saving cash to Top-Up CPF in January. One more year to go before 55.



Cory
2022-0116
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Jan 15, 2022

Cory Diary : Omicron the Savior ?

The past pandemic early in the century, millions died and then it goes away in about 2 years naturally without even the need of vaccine. With Covid it looks like the emergence of Omicron maybe the one that will naturalized into us as non-lethal Covid giving us the immunity needed. Will it be so ? A poor man natural immunity but nevertheless an effective ones because it is so much virulent. Deaths count has been coming down too in Singapore together with our strong vaccinations coverages. We pray it will be that way. Personally I have confidence Covid is ending. And we need to be prepared for the rise of the economy. 

For Year 2022 I have high hopes of Strong Recovery of Retail Malls. This boot well for CICT, FCT and MCT. Will Travel be back I am not completely sure because of regulation of travel is quite a hassle and expensive due to both sides. Even if Singapore opens up it takes two to clap. MNACT  & CRCT not so sure too due to stringent control policy.

The increase in interest rate means the economy will be in right path else it defeats the whole purpose of raising rate despite higher inflation. And is counter intuitive to raise it till recession as well which in era of Allen Greenspan did (An American economist who served five terms as the 13th chair of the Federal Reserve in the United States from 1987 to 2006.) . The abnormal high inflation seen in US in my opinion is due to distribution of free money to the population without productivity. Ultimate recipe for high inflation. When the gov stops, so will the problem but it does takes time for the free money to dry up before people starts working. To crawl back what's already inflated is not easy or unlikely. However the future looks like inflation has reached it's peak.

The next class of stock that may benefits I think is businesses that are profitable. Banks, Sheng Siong, Netlink, .... . Keeping in mind of Digital Banking. They can retard any benefits on existing bank if they are not careful on their competitiveness. The stocks I could hold in oversea markets are those growing and profitable such as Tesla, HP Inc, AMD, Microsoft etc. My current focus is still Tesla and will expand to others if there's a need to reduce my reliant on SGX market Reits which seems a little shake out after the saga of MCT/MNACT Merger proposal which now viewed as self-damaging to the image they have built up for years. The market is demanding for higher yield which implies lower stock price making future acquisitions less attractive. 

The next question I have is will Industrial / Logistic Reits do well ? I think strong reit will be ok as they are always profitable but exception applies when sponsor undermine the Reits by selling risks to them. On another note Ascendas Reit is now under Capitaland. A reminder to myself. And so far what value have they add to Ascendas is yet to be seen.


Cory
2022-0115


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Jan 9, 2022

Cory Diary : Holding our emotion during market volatility

Investment is tough when market is in high volatility and position is in red, really red. How red is red is based on individual pain points. For anyone this is matter of time when we are in this situation. Some people may feel painful losing $800 when their monthly salary is $8000. Some people do not feel much at all and sleep soundly even when they are in $250,000 loss. The key is to find our ways to close the gap and how to overcome the emotion so that we do not worsen our situation further. Below is what I did.


“Successful investing is about managing risk, not avoiding it.” “The essence of investment management is the management of risks, not the management of returns.” This is what Benjamin Graham, the father of value investing, had to say about investment risk.


Taking care of our basic needs

There are not many available. What I did is to make sure there are safety nets.

SSB and try to maximise it when possible. More than $4k of interest last year. Rotate them when I find it is worthwhile to get better interests in net after cascading.

CPF and try to maximise my CPF SA first. Do VHR. Do OA to SA Transfer. Top-up MA. When SA Max, VC3AC. In my context to age 55 and therefore only need to do this a few times. More than 10k of CPF interests received this week !

Tried Singapore Treasuries and find top quality preference shares or bonds available in the market. Preferably by local big 3 banks. They provide baseline defense when market crashes. And at portfolio level reduce to the % losses. Likewise it will also reduce your gains when market is in high mode. Today I do not hold any preference but I still have Frasers Bond as I moved them slowly to CPF for longer term plan.

Emergency funds and having job help too. Many fundamentally strong stocks when oversold typically comes back. It is quite detrimental to one financially if we are force to offload stocks at low price due bad circumstances. Be ready and prepared.

Having something over our head helps. A home where we can have peace of mind. No worry being chased out from our rental home. A place where we can rest with peace. It can be a 3 room HDB, a condo or whatever affordable. We can move on from there as we grow.


Diversifying our Income

Do not have many talents. Do not know how or energy to learn to do business. Not a person who can depend on You-tube to get income either. Though I blog, is only allowance received. Yes is allowance unless you are the top. The easier way is to rent out our property and the income is quite sizeable and within our ability. There is some work but is much easier to overcome. Now with new property curbs. this gate is even smaller now. Fortunate to bought a property in the middle of property curbs. Never look back.


Dividend Strategy

Within the stock market, Singapore has a key segment which are dividend income focus called Reits. A good start to create the basic safety nets on equity investment income itself. Like most equity. there is risk. Higher risk for other who do not know what they are doing.

Reits have to distribute 90% of their distributor income to shareholders to enjoy tax break. Due to that is quite popular to many including myself. Some of the reits are high risk and you can lose big time. I stick with reliable ones with lower yield. They typically will not have capital loss in the long run even if you miss Rights Issue. When venture out to higher risk ones, do much more home work and size the investment accordingly so that we can sleep well even when the sky drops.

It feels good to know that we are collecting dividend and confident that the stock price will return back. If you are not, better do home work.


Capital Recycle

I do take profits when the market in euphoria stage or specific stocks have significant run up. And then do re-balance to similar risk level or balance it out in a way in net there is higher cash on hands after. Typical done in stages. Not only selling but buying too. Trading fees not my top concerns and I typically do in stages to manage out the timing price differences.

Why we do this is quite simple. Market fluctuates and often psychological managed by mass media or even analysts to talk up or down specific stocks. When Taxi uncle is also talking about it, friends who never talk about stock starts picking them up, when everyday news is on all time high, are indications.


Having a War Chest

When we have bullets ready to shoot we are in attack mode. We know is an opportunity to "kio durians". This will help us weather discomfort in down market too. In fact we may even feel better that we can enter into new positions or enlarge our existing investment specifically Reits as we are buying cheap with good chance on same dpu.


Going in small initially

When we have a huge amount of money to invest but little experience. Is highly risky to plough them all into the market. This is really timing the market mindlessly. This is similar for new position for experience investor.

We can start small and over time we feel better or in good net position, we can average up. This will absorb down side better as there will be profit buffers already build into an uptrend market such that when the market collapses we feel much less in pain.


Improve Investment knowledge

Ability to understand what's going on and do basic evaluation helps a long way to reduce or manage risk. So always have an interest in improving one's knowledge. Is easy to manage one emotion when making money but is hard when you are in losing one.


Avoid Penny Stocks

Like BBs will manipulated with Mass Media, the smaller Boys will manipulated in Telegram, Forums, Whatsapp, Meta Platform etc to encourage you to buy into specific stocks that they can manipulate the stock prices. Sometimes one may escape unharmed or with profit but you just need one time get caught, and is big lesson learned. Even if there is no manipulation going on, is basically gambling between the investors and someone will lose out who could be an investor as is a zero sum game for such scenarios.

Such speculation is highly dangerous especially Penny stocks because it is much easier for perpetuators to control unless they are Bill Hwang in the big league. Scammers can work in group with multiple accounts to give the impression that there are  many people joining the frenzy game and talking among themselves. In all, it could also be just an investor talking to himself. Always be suspicious when a value investor suddenly ask people to buy penny stocks or share his investment in penny because this contradict everything he does. In all likelihood, you will be buying from him at the end of the day.


Cutting Loss

I find this most important. When we make mistake or controlling exposure, we have no concern in cutting loss. It should be like a walk in the park. Long run typically I am in better position mentally and financially. Some people refuse to sell till their position is in profit. This can be dangerous behavior as the stock fundamental is not there.


Diversification

One of the worst mistake is not knowing we are in one. We can keep averaging down and down but the stock price never really come back up. We did our home work many times. Unfortunately time is money. And sometimes our conclusion is bias and wrong. Hence is important to diversify so that we can survive and continue our investing journey.

Major market Index ETF like S&P500 is broad based well diversified market index. Fund managers may hate it because they are beaten by it usually and some has been bias against it. The risk is country risk. Frankly US is as strong as ever despite specific groups who dislike it. Unfortunately I know about this too late. The Index is usually ATH but I will try when opportunity arise.

I do diversify my portfolio into multiple reits, banks, non-banks and last year into US stocks. This is in addition to SSB, CPF and others.


Lastly,

There are many moving wheels and each play an important items in my watchlist and always look out for more. Drop any on our own perils. Help me to invest and grow my wealth. Without them probably I would just leave most of them in the saving bank and this will be the highest risk in inflationary world.

Imagine you have 100K in saving. A 5% inflation is 5k losses in purchasing power each year. Many people refuse to see it and feel secure they still have 100k in the bank plus the interests. This is real loss just that the figure doesn't change and is highly damaging to working middle class who earn average monthly salary income and who has saved a life time in a decaying pot.

Money is Working for me. But it may not works for everyone so take care and be safe.


Cory
2022-0109

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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.

Jan 8, 2022

Cory Diary : Net Worth Trend Updates

Net Worth Chart

The trend continues on polynomial curve upwards on an average rate of 9.8% for the past 14 years compounded. This is despite a large portion of the asset resides in lower returns instruments which implies the needs for annual salary income plus equity returns to supplement. The hope is for property value to match along which just got dashed in the wake of new property curbs. However, is a matter of time inflation has to be reflected into them.

For Year 2021 continued growth, this is happening due to mainly Job Bonus income and better Equity Investment returns. Company also benefited from the Covid situation and we have a better adjustment too. The liquidity curve is slowing down which reflects increasing expense ( daily and housing loan repayment ), allocation of cash into CPF and voluntary housing fund into CPF done last year. The gap will be widen further when we top-up CPF this month.



The Security/MMF ( Orange line ) is on the uptrend due to increasing efficiency of investment. Therefore the space gap makes with Liquidity ( Red line ) is the idle cash and fixed deposits. This are getting smaller till 55 as CPF is top up till Age 55. The known retardation is the coming FCL bond maturing which will release cash and provides some widening.

Last year property value is flat however the blue line is on consistent rise due to the monthly loan repayment. Insurance surrender value has went up a little. Representation between the blue and red lines. Likely the blue path trend will remain so for years to come.

To maintain the current Net Worth trajectory, Job and Equity investment will continue to be depended. As equity returns can continue way beyond retirement, the hope is that we divert sufficient fund over time to reduce salary income dependency. Interestingly, the company do a good job to ensure this do not happen easily by continuing to increase the compensations such that it looks like they will be always the main driver from income unless we have significant contribution from equity investment returns.


Asset Allocation

Introduce CDA for Child Development Account. A segment which did more than enough required top-up last year to match the baby bonus. The scheme is good but CDA can be better if is well supported throughout the growing up period till they are in workforce or army. This will further help relieve the cost of parents and allow the child to have additional safety net on education and living expenses.



Saving Cash at 6.5% seems still quite large especially when there are additional 3.3% FD. Probably 5% will be sufficient for cash level. Inflation will be high but the market likely weak so maybe wise to achieve a balance between them. If there are alternative to overcome both this could be interesting. For now looks like nothing much else to act further.


Plan for 2022

The current macro condition on tapering execution is a done deal. The talk now is on interest rate hikes after. Even with those rolling in, the rate is still low and do not see sufficient interest rate returns in saving banks. Housing loan rate will remain affordable for years to come. And in time, Reits will be back thriving in inflationary world till the the rate overshot which will take a long time to happen unless the Fed trigger happy.

For now, Fed actions could put an end to mindless investment injection into unprofitable growth stocks that do not have good degree of success. The recent years on SPAC deals are symptoms of this happening. A lot of shareholders value is destroyed and this will be reflected when results are materialized. The impact could overflow to other segment of the economy however degree of impact is expect to be much smaller.

For three years in a row the portfolio has robust returns from equity. This year will be good to be flat if not better. However if there is a loss, need to be quick in mitigating them. Growth stock achieved 14% allocation in Equity Chart. Not shown here.

Primary Tasks

1. CPF Top-Up to Max ( VC3AC )
2. Increase Investment in Growth Stocks. Need to explore how much.
3. Dividend Target 60k
4. Sell Vested Stock allocation
5. Put a portion of the emergency cash into Fixed Deposits
6. Use more stroller instead of cab
7. Trip to Tainan for Holiday
8. 8% minimum warchest allocation 
9. 5% - 5.5% cash allocation
10. No major adventure. Look for mitigation investment strategy.
11. Annual Parent allowances - completed

 

Secondary Tasks

1. Children CPF Top Up / CDA Top Up
2. Personal MA Top Up
3. Try S&P500 if there are enough correction


PS. 3 yr old daughter starts to learn to sing on herself today

Cory
2022-0108

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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.

Jan 2, 2022

Cory Diary : Financial Report 2021

FINANCIAL GOALS

Financial goal is that in my retirement period, investments can well cover the need of my Family & Emergency Expenses and an Equity Portfolio returns that is diverging long term. I see myself continues to manage the portfolio well into my retirement. Has Will drawn up in my bucket list and experience pass down to my children so that they have better head start.


NETWORTH REPORT



As the net worth gets bigger I find it quite impossible to continue on 10% path but manage to get it done for Year 2021 despite increasing expenses. Year 2021 is best remembered for my juggling act on so many things. 24 hours really not enough as I am the type of person who needs a lot of personal space. Is fortunate that our company do well during this Covid period. With the pace of Omicron is spreading, there is good chance that Covid may end soon so that life can return to a Better Normal.


EQUITY

Achieved XIRR 10.1% for Year 2021. ( Absolute return 10.8% ). Two main stocks drive half the profit. DBS and TESLA.  Remainders mainly from other US Shares, SGX defensive counters and a few Reits which I locked profits. The move to NASDAQ this year helped the portfolio significantly and also provide a more balanced portfolio to SGX counters.




Manage to reduce stock counters to 15. Their dividend will drive around S$65K for year 2022. The growth stocks are relatively new for me and hope to see continue investment there with baseline dividends achieved. Did more than 250 trades this year choking up almost 8k of fees and expense ratio of 0.52%

Based on recent 5Y performance, every year tells a different story. The portfolio constantly needs to keep pace with market changes each year. Year 2022 will in interesting due to anticipated interest rate hike. This is probable but not definite as personally I feel is tied to the strength of US Economy. Fed maybe forced to print again or maintain status quo after tapering. Regardless, the portfolio has to adapt quickly. One thing I need to keep reminding myself is to cut loss on poor performing companies and this is what Index does too basically.



Below is the lifetime return of equity investing. Investing in strong good companies give a significant better result. Frankly, I am not a good stock picker but I am fast in cutting loss. Cannot stress the importance.




CPF

In summary, after refunding all my CPF housing loan and move them to SA. FRS is Max. In addition VC3AC to Max too. I also did some top up for my toddlers just to try out the process. If you are interested, on detail I have a CPF page for it in the blog.

The plan is to max my top up till 55. And if possible, CPF shielding. After RA allocation, I could see a good amount inside CPF generating Interests which I can withdraw as needed. Still deliberating whether to max out MA as it doesn't look like the interests will hit ceiling of MA annual adjustment.

CPF is the baseline safety net protection of returns. Received more than $10k in interests yesterday. Gov gives free money must take which is basically almost risk free and stress free. Obviously people in this game will like to see continuity.


INSURANCE

Have two main insurances that I have been paying monthly for more than 20 years and has been  continuing them. The main issue with saving type of insurance is the bonus portion is not guaranteed. People can find out later ( like after 20 years ) that they may get zero ! and the fear is that there is nothing much they can do about it. This sounds untenable to me even though my current one has bonus that is good enough. So far from calls, the amount confirmed looks reasonable. I will find an optimal time to withdraw it and will be a model learning case for others. For my the other which is Life Insurance it does not seems worth to surrender as the benefits are significantly higher after I passed. Probably will procrastinate this one.


SINGAPORE SAVING BOND

This is held in reserve for bank loan repayment backup which can also double up for family emergency. Is already Max out 200k. As the figure is fixed, over time this 200k will become smaller and smaller in percentage term relative to Net Worth naturally. One do not have to do much and therefore best leave it untouched.

Interests collected is on cascading basis for 10 years. This year will be $4207. By the end of 10 years most of home loan will be paid. We can then decide whether need this reserve amount. Ideally if the gov increase the ceiling further we could do some shuffle to stagger out the bond due dates.


PROPERTY

Have an investment property. Currently the rental supports are not optimized so I foresee room for financial return improvement if needed. The rental is not able to cover the monthly repayment due to the large principal repayment portion as the loan period is short. However considering this is due to larger principal repayment and not the interests itself, in net perspective is still worth the investment as it is positive earning. However there are stress in managing the cashflow as this can limit your choices in life. I am treating it as "Force Saving". This is one item that is driving up expenses.

With the new property curb, it is now much harder for one to own a private property. Chances are young family may need spouse to also be in workforce with reasonable good job for a family to afford staying in one. I am curious how will this affect my property valuation therefore the net property value. Probably flat I guess.

Property is a natural hedge against inflation with added bonus of rental income. Ironically, renting in Singapore is not cheap so is my believe that one should always have a property in their name and using bank loan which is only 1.5% fixed for my case. I could not justify taking a loan from CPF.


Cory
2022-0102

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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.