Cory Diary : NetLink NBN Trust Q3 is out !

Have been keenly anticipating for this quarterly report. Here's the interesting part for the same News by Shentonwire and BT respectively..

SW : NetLink NBN Trust reports fiscal 3Q net profit of S$19.6 million, above IPO forecasts

BT : NetLink NBN Trust Q3 net profit down by 9.4% as costs mount


One is as expected due to investments. The other see it negatively as rising costs.
Who is right ?

We can confirm at the end of tomorrow's trading day for market sentiment but long term I support SW report of-course (vested).


Cory
2019-0213

Cory Diary : Diminishing Power of Dividend Play

Like any business, leverage allows us to increase our income provided what we earned is more than the cost we borrowed. However this is subjected to lender conditions. When the bank refused to lend you more (weakness), this tell something. If you could borrow cheaper than what the bank willingness to lend you, this says something too (strength).

For a start, for non-believable of Reits ... read  Here . Over the years, stable and strong REITS have registered significant capital gains on top of dividends. This started with multiple QEs follow by tapering and rising rates. This also resulted Reits getting more expensive. Let's take one of my favorite REIT Capitamall Tr (CMT). 

I have blogged countless time why I invested in CMT. Below 3 of my earliest articles.

Cory Diary : CAPITALAND MALL TRUST 4Q16

Cory Diary : CAPITALAND MALL TRUST 1Q17 ( CMT )

Cory Diary : CAPITALAND MALL TRUST 2Q17 ( CMT )

Each time with increasing Stock Price, the yields get lower. Now, with current 5% yield would we buy ? Before we able to answer this we need to consider a few points.

1. Singapore economy has been performing relatively well. We have strong currency and unemployment is relatively low. Cash get accumulated in saving banks.

2. Property curbs have driven away many investors

3. Interests rate despite increasing is still a low rate.

4. Singapore Saving Bond = 2.5% ( 10 yrs ) capped by recent ceiling of 200k.

5. World is on low growth path

This implied there is a large reservoir of cash seeking for opportunities that can beat SSB dividends and long term dividend returns and growth will be bonus. This money aren't expecting Best World type of stocks for those who do, many fails. Which non-REIT stocks can beat CMT on that ? 

Now to the last comment for our thought. With lowering yield in CMT. Would we buy. This is back to the fear of anchoring that one should avoid. With 5% yield, how many options out there that can give us relatively safe and constant 5% dividends with some growth ?

Final note, this need not be CMT. It can be Ascendas. It can be Maple family. But a well managed Reits take out a big chunk from public listed company mindset of owner that "This entire company is mine mentality".

So did we see a peak in Reits recently ? Your guess is as good as mine. But long term, whatever fluctuation in prices, your dividends will catch up to cover. The important point is, how long. 

Got your answer ?


Cheers

Cory
2019-0209

Cory Diary : Net Worth 20190205

Net Worth

The last time I blogged about Net Worth is in 2018 May. (see link). It  has since increased by about 5.3% to date. A hint of size, my equity net worth just crossed a hallmark with recent market run up in Jan'19. My last year dividend is roughly 47k. For definition on Net Worth to me, read #1 and read #2. Basically in essence is net present value if I am to sell off everything including my home and adding Pension/CPF to it since I could not sell them.

Saving

I thought of reducing my saving but interestingly it went up significantly to 16% which kind of a surprise me. Maybe few percentage due to recent share sales.( updated: Good bonus from last year, baby cost me probably 20k ). My goal is to reduce it as mentioned earlier (read here ) ... but ..execution is a problem as I don't go by target number forcibly. The investment injection is about 4.9% which pretty align to Net Worth 5.3% growth. Another possible reason is because of hit on ceiling in my SSB contribution, and with the increase of limits to 200k, I could do some improvement this year.

Insurance

With the amount of cash in hand, there is no strong reason to surrender Insurance policy. I would just let my endowment continue to roll. I have not think much about my Life Policy as well but I guess it will be in  procrastination mode for the better.


Why am I doing this on first day of CNY ? ... Enjoying my Babysitting experience ... ... ...
Happy Chinese New Year !

Cheers

Cory 2019-0205

Cory Diary : Liquid Asset 2019-0202

Equity takes up 50% of my liquid asset. With Bond/Pref, that will be 59%. If I am to add Gov securities, that's 68%. This group is making money to work category.

I was working on the above points and then realize is really a bad plan to lower my saving by 12 points for much higher equity allocation. Is inward looking of personal finance furthermore I am already vested with 50% Equity. Prefer good buffer for emergency, housing and family so I aren't putting them to risk.

Maybe growing the equity pie by 10% will helps. That will boost (updated for privacy) dividend after 2019 and will takes 3 years of good market to achieve. If I am to do some income injection and some modest capital adjustments of the 21% Cash saving, probably 2 years. That's sound more forward looking.

And if the market goes bad. Wait it out ...


Cory

2019-0202

Cory Diary : Updates on Jan'19 Trades

Last Friday Cory Equity Portfolio crosses a key milestone in size excluding bank cash, treasuries and SSB. I have to make sure the crossing is not deliberate but something I am comfortable with the market. This is on the back of YTD over 5% returns. As most people would suspects, Fed finally tone down in their message. However if the market goes crazy again, Fed may shoot in a surprise hike .... sigh ! Hopefully market stays calm for the week.


A quick summary on all my recent trades.

PARKWAYLIFE REIT - Sold all my shares for 4.6% profit YTD. That's like 1 year dividend in a month work except that it went further up 3% after, due mainly to rising market ... ( you can't win all ). The move is to improve my reit yield and able to consolidate my counters.

ASCENDAS REIT - Did some quick trading on a portion of my stock before and after results. Manage to get some kopi money. My broker a bit busy and not able to execute my queue in time else I would have doubled my earning.

CAPITAMALL TRUST - I also did a quick trade on a portion of my stock. Good gains but I think is more due to rising market again. Investment size is now 7.8% of my portfolio but with 5.1% yield, I think am good with this level. That's doubled SSB returns.

MAPLETREE COM TR - Up a little as I find my exposure insufficient for my effort. So this gives me more punch for the buck. At 5.11% investment size now, I think is max on this one. Fortunately, able to catch most of the rising ride. 

FRASERS COM TR - For same reason as Mapletree Com Tr, I up some as well. And happen to ride the market.

Trading expenses hit nearly $600. Moving on I will have to make sure more diligence before I do a trade. The expense is slightly high, and I am expecting after special rebate will be $450 region.  That's probably 1% of my Profit this month but this can explode if the market comes down quickly so I need to get a handle on this.

Mean time ride the market ! Sign off for Jan '19.


Cory
2019-0131

Cory Diary : Cory Bubble - 2019-0129

With minor tweaking on the axis and with recent market strength, I am too eager to show this.
Yes, my portfolio is bubbling !

One counter missing. ParkwayLife Reit. Sold it yesterday. Cheers.

Cory
2019-0129

Cory Diary : Market Performance - 20 Years

Have you thought what does it looks like after 20 years in the Market as a Retail Investor with zero financial knowledge when he started ?

To add, never blame economy, blame SARs, blame GFC, blame Tapering, blame Greece crisis or blame trump. ;) Nothing is impossible but if you don't look out for your own, no one will. At the end of the day, only ourselves to blame.


Cory
2019-0127

Cory Diary: Scams keep revolving around

https://www.channelnewsasia.com/news/singapore/the-gold-label-investment-scam-arrested-for-multi-million-dollar-11166428

This time is back to Gold again ... 2000 investors. How the heck the trio managed to get so many investors to invest ? As someone (TTI) said is Darwinism at work again and their genes don't get to proliferate hopefully.  Probably it is. Maybe we should give national awards to this trio for helping to improve our gene pool.

Joke aside, no amount of regulation and government intervention will help this group of people. We do not need to be smart to survive in this world. Just don't be stupid.


Cory

2019-0126

Cory Diary : NetLink NBN Tr

Have been doing some investigations into 5G Technology. This is the biggest concern on whether is overall plus or negative to NetLink NBN Tr in regard to Home Network.

5G can run hundred of times faster than current 4G. If is just for Video, 4G is enough today. So it has to offer more than that such as latency, VR, Iot and remote services. It can also put less  reliant on cable to remote places which will be costly to lay.

For Singapore which is heavily built up, Home Fibre Optics connection is almost everywhere. So will 5G replace fibre optics home network ? A few consideration comes to my mind.

1. 5G tech runs on MilliWaves. What this means literally is that even trees can block your transmission signal. So walls is no no. With condo and HDB everywhere, transmission is tough.
2. High dense cells network needed and they have to run on infra backbone.
3. Is fast, very fast. The package probably has to be on unlimited data plan.
4. Stability of connections. It could be fragile and would need layers of support.
5. Safety and dependency on use.

All the above means High Cost to implement and subscribe. This will also impact Service Provider profitability selling data plans.


Possible Options

1. Tap existing home fibre network for 5G routers. Fast and cheap.

2. Unsightly installation of base cells everywhere. Not all homes will have access.
High amount of maintenance and installation complexity on every home each with unique conditions.

3. 5G not needed for most home application. Not needed. Maybe 7-10 years later when VR is a big hit and very mature. By then, Fibre Optics may have catch up in speed.

4. Mobile plan hot spot is too expensive and will be years later. And due to mobility, home appliances will be without network service when away.

With Option 1, is pretty obvious NetLink NBN Tr is here to stay.



Cory
2019-0122

Cory Diary : LION-PHILLIP S-REIT

Doing my home work looking through ETF - LION-PHILLIP S-REIT.

Found following information.

Then I check the last of trades done. Big players are selling down and we have some retailers seem itchy fingers.

.

The yield 3.43% is quite low. I remember being "marketed" for 5.2% yield. I would accept 4.5% What has gone wrong ? Even Parkway-life Reit easily beats this. I would avoid such trades.

Cory

2019-0120

Cory Diary : Quick Re-balance 2019-0119

The Portfolio Chart is nicely bubbling upwards. I could see some easing up on the congestion. With the recent run-up of some counters, some actions are done to re-balance to reduce risk and assess dividends.

See LINK here for earlier published bubble chart.

1. Reduced Netlink Tr. : Large part of my holding. I would prefer investment size to be between 5% to 8%.

2. Expanded FCOT : Mid Tier Size - This is longer term haul. Low gearing. Strong history of not issuing rights which is my personal preference. With the recent run-up, able to scope some more when it go lower before result announcement. The DPU result is flat which is neutral. I like to see how Singapore properties perform. Hope they can secure a smallish strong acquisition  to relieve the distribution support from capital gains.

3. Expanded CMT  : Range trading. A large part of my holding. This ship is steady. Looking forward to Funan contribution for future assessment.

4. Reduced Ascendas Reit : Did some range trading. Large part of my holding. What to look for is growth as it went below 6% yield before deciding next move needs.


Cory
2019-0119

Cory Diary : Investment Tracker 2019 - 0116

If we could recall, Year 2018 is where Cory Portfolio was mostly in the negative territory. See link here. The first two weeks of 2019 is quite amazing. Losses in 2018 has all but recovered.

This is one reason why staying invested in Market is important for people who long. From the above chart we can see how strongly STI ETF bounced back overtaking Cory PF line. However, I am happy. Are you ?

Strictly speaking, we hope to target additional 10% from this point onward. Why ? For the two years of dividends.


Cory
2019-0116

Cory Diary : Refreshing Portfolio Setup

It has been a fruitful week. From the low of two fri ago on 1/4 , STI ETF swing back up to close strongly driving whole week of positives. This is certainly a positive week spurt which happens only few times a year. Staying invested folks have a field day. However for those who shorted the general market thinking it will go negatives are caught wrong footed this time as is a 7.2% swing in total. Is so hard to predict.

This also drives my portfolio upwards with different counter benefits differently from it. Passion is everything. Here's my new Radar 2.0 setup format for Year 2019.

 Look out for 0%, 5% and 10% markers They are investment size.

The Green's : Reit/Trust
The Purple's : Fixed Income Equities
The Cyan's : Volatile / Growth / Speculation
The Orange's : Blue Chips and STI Index

Cory

2019-0113

Cory Diary : DBS FHR8

I have the opportunity to re-price my housing loan with DBS. There are 2 options currently other than doing nothing which will be paying more.

Additional Information

For the first 2 years, the gap all-in is about 0.345% between Fixed and Floating package.
FHR is tied to DBS Fixed Deposits 8 months rate. The rate is kind of "Board Rate". I read somewhere that there is limits on how much a bank can change as there is some MAS oversight. Not sure is true and how stringent will MAS allows though. Nevertheless there is more transparency in how the final loan rate is charged.


Rationale for Fixed Package

This 0.345% gap can be closed within a year of rate rise which could make the Fixed package more attractive however the spread for year 3 and 4 will be wider and to floating method. Since the lock-in period is 2 year, i could re-price again but there is some work and fees to consider. I think DBS structured this way so that they can manage their fixed package risk.


Rationale for Floating Package

If there is no significant upward moves for the first 2 years in FHR8 rate, the floating package could be cheaper than fixed. This is especially so with Fed recent rate hike that invited some quarters of criticism. And they may stay low for Year 2019. Not sure about 2020 though. However with SSB limits up from 100k to 200k the bank may up the rate to make themselves more attractive. This won't matter much if there is no one to lend to with property curbs on-going or recession strikes. So if all goes well, there aren't need for a re-pricing exercise after lock-in period unless we like to do a refinance to other banks or there is a better re-price package like FHR4 ? :)


Seems like either options will work fine as they do not offer significant advantage over one another. I would probably choose the later.


Cory
2019-0112

Cory Diary : My retirement just got pushed back

Kind of shocking headline. One of my past lovers arrived. ( ... here's your Karma ...)
39 weeks and more to come but is all worth it, and I have done my part for my country. ;)

Welcome to the family ! My best investment returns. Priceless !

Cory
2019-0111

Cory Diary : Expense Ratio

This may have gone around for few times ... . To win in the long run, expense ratio probably matters. That's one reason why Index or Mutual funds are good. If we search the web, is defined as "The expense ratio is calculated by dividing a fund’s operating expenses by the average total dollar value for all the assets within the fund."

For 2018 my Expense Ratio is 0.62%. That's low relatively to fund however for retail investors this probably high. Really high for a dividend player. The number of trades for 2018 is 124. That's lower than year 2017 so I am in the right direction. One of the reason we see high number of trades is due to breaking down the amount I trade into different days to spread it.

I don't have hard rule on not do a trade due to expense as I am risking the ship for a sampan. Rather I need to do a more calculated decision on purpose rather on hunch when doing multiples for a position. Market has been going up and up. And I have yet done a single trade this year. Well done Cory !  ;)


Cory

2019-0109

Cory Diary : Why we should use XIRR for Performance Metric

Many may have heard of Time Weighted and Money Weighted. There continues to be confusion on what metric to use in performance measure. For retailers and typically investors I dare to say it has to be Money-weighted. I just read an article and reinforce my understanding that most users should only use Money-Weighted.

Time weighted by funds usage to me is quite misleading on performance over time if you read further down. Fortunately, when we says money weighted we are referring to XIRR in Excel.

Here's the table i extract from the article. (link )

Both methods have $1M injected by 2 parcels. Initial and mid June. Both losses 200K in the end. Logically performance should be negative at the end of the period. However TWR registered 146% good performance whereas XIRR registered -30%. Enough Said. Stick to XIRR (MWR) please.

If sales people tell you their fund performance is good, be wary. They could be using TWR. Is not intuitive for normal people but I wouldn't say they are wrong. LOL.


Cory
20190108

Cory Diary : Asset Tracker 2019-0108

Net Worth

With the beginning of the new year is time to assess my net worth trending. In this update, I have added "Non-Retirement line'. There is a good spike ending 2018 due to YEB and VB.  The losses in 2018 is mitigated by monthly income. This will expects to reduce in coming months due to local taxes and parent allowances.

 I should have done better in 2018 but I didn't. Nevertheless, my Assets continue to move up but at a slower pace with increasing expenses and poor market. Based on past trend, 2019 (touch wood) will be a good year for local investor. Why ?

I mentioned on the support lines that is strong. ( link ). Looks like so far they are held up pretty good. So my recent increase in STI Index and Reits help for now. I also did a quick swap on some of my SSB for Jan'19 allotment which is successful. Quite happy as is 0.5% rate up on top of starting 2.01% for year 1 which is almost doubled I had previously. Finally, in my many years of investment, after a year of negative returns, the year after is good positive. This happens 3 times for negative years ( Year 2008, 2011 and 2015) and 2018 will be the 4th !

Cory

20190108

Cory Diary : Investment Portfolio 2019-0104

Portfolio

As usual, my Investment Portfolio excludes tracking Pensions, SSB, Treasuries and Fixed Deposits. This setup is slightly higher up in Trusts/Reits allocation of 53%. I foresee waiting for market dips before increasing further. I have also reserved for a few positions for future acquisition in 2019.

There is nothing much to show on the bubble chart other than the yield expectation for start of year. A lot of overlapping. As the year past, this will probably scatter.

With 24 counters, seems I have my plate full. To most people this maybe too much. However I think is necessary for dividend diversification, and compensate for my selection weakness and emotions. Compared to my wife, she only has 2 stocks. One of them gained 4 times in 2 years. She is clearly on different worlds.

In 2019, I hope not to see drastic change in my portfolio.I have the same hope when I started last year. So ....


Cory
2019-0104

Cory Diary : 2018 Equity Performance

Year 2018

2018 has been tough for local equity investor. The STI ETF registered -6.48% after dividends. For people who is new to this, STI ETF is traded in SGX like shares in stock market. The last traded price is 3.117. (Stock Quote is ES3). It is often use as a benchmark to measure against investor portfolio performance as the ETF closely follows Straits Times Index which tracks the performance of the top 30 companies listed on the Singapore Exchange.

There are few methods to measure STI ETF Performance. I use XIRR after considering dividends distributed over the year. ( Typically twice annually ). XIRR is a function in Excel to calculate annualized returns. So we can do apple to apple comparison to my Investment performance. On the right table computed is how I obtain STI XIRR -6.48% including dividends.

My XIRR for 2018 Performance is -3.28% which is closely match to -3% portfolio losses. If I am to exclude US stocks, it will be XIRR -2.12%. So 2018 is the year where I am in the negative after dividends. My test drive in US Stock is quite bad in timing and the only consolidation is only a few % of my portfolio. So as mentioned in my earlier article, every % counts. The other lesson learned is on SME stocks that are more towards capital gain to size them up correctly smaller as they are more volatile in bad market condition and to realize them. 

What I did well is to contain and manage my losses and therefore outperform STI by 3.2% if I am to include US Stocks or 4.6% for local equity alone. This is especially important to me because over the years my portfolio has grown quite significantly. Every 1% move is quite a delta in $ number today than 5 or 10 years ago. Another thing I did well is work :). I got good bonus and this basically covered all my losses.

Cumulative Performance Comparison

Comparison is more meaningful if we do cumulative to minimize the luck component. This differentiate the men from the boys. However comparison to STI is tricky reason being you cannot decide when you are born therefore cumulative 30 years STI returns can be vastly different from cumulative 10 years STI returns from now. So is very misleading in my opinion if one advocate index investing purely without taking timing into consideration. Since I start actively with sizable portfolio 12 years ago, that will be the benchmark I will use. There are others assumptions made but let's ignore for simplicity.

I check multiple times on STI from 2007 onward. Excluding dividends if you have been doing index investing, is actually -0.2% annualized returns for STI. Which means about 3% returns after dividends.

For myself, 5.4% annualized 12 years compounded. The figure is expected to go on a down trend due to recent years of market weakness similar to STI however I have added disadvantage on aging and need to allocate to lower yield bonds, and much larger allocation of cash injection in later years. I would see the returns going down to 5% to match my portfolio dividend yield if the broad market continues to be flat or negative. Nevertheless is still better than leaving them in the banks.

My New Year Wish is to be able to help my wife manage her portfolio. She has been pretty damn lucky that I won't wish to touch. I have 2 more other wishes for 2019. 

Happy New Year !

Cory

2019-0101