Cory Diary : Things I found out from Property Ownership

Not in any specific order, I am writing them down as notes as it comes off my mind for the past few days. No right or wrong but welcome to correct any errors.

1. Using CPF to pay for the housing

I think every couple should own their first property a HDB. Is the most affordable and one should only buy the right size that fits their income. If overstretch, relationship can be bad. And couple could be stressed.  Happy family, happy life, and good health. 

Question will be should we tap on CPF to purchase the property ? No right or wrong imo due to different circumstances. Just to be aware that there is accrued interests that we need to pay back to our own CPF account generally. Reason being I view CPF guaranteed returns are attractive and it makes sense for me to refund using idle money in the bank.

For my case, my SA account is not filled therefore VHR makes sense as I will do OA to SA transfer immediately after. So now hit FRS. After which I can do VC3AC to build up my SA further. There is annual limit of $37740 for MC+VC.

2. Condo Maintenance is sizeable

Let say $300 monthly. This is equal to $3600 annual ! And as I know this is generally paid by landlord if you rent out. So if one has no plan to use the condo for investment returns rather home stay, there is cost attached. In-addition there are gov benefits that ties to type of housing you live in. However life on earth is limited and each one has their own lifestyle. Make the full use of it.

3. Monthly Instalment there are 2 portions

Why I mention this is because the impact from interest rate is mitigated as time past due to large portion of our monthly installment is for paying down the principal loan. One reason why I refinance to a Fixed rate loan for 5 years. Lock lower rate on surface but also bought 5 years.

4. Property Tax

Yes, there is a cost. Period. In-addition I missed my 2nd payment because they switch to paperless without my explicit approval. They then allow me pay up without penalty for this time only. I feel like kenna kick and still have to bow to them. Life is Brutal next to Arrogant. 

5. Employment/Income Risk

You will be tied down. Risk of unemployment. Age risk. At age 51, if I am out of job, what is the chance that I can find another similar paying job within one year ? And if I could not, maybe is unlikely 5 years down the road. To mitigate this, do you think 1 year emergency fund enough ? So chances are is either get another job quickly at much lower pay of mismatch skillset or plan to be retired regardless I like it or not. Yes, is a waste of my skill but bo pian. 

6. Loan Year Restriction on Age

This is big for me because of my older age I can only borrow for 14 years max today. What this mean is my monthly amount will be much larger due to shorter loan period and need to meet the TDSR the same time. So if I plan to buy my next property,  I will need to pay much more in cash.

7.  Rental Income

For $3000 monthly rental, annual income is $36,000. This is good amount to offset loan payment for investment property at my age. Therefore I would only own more properties if regulation is more relaxed. There is risk if we do not have stable income or saving asset, we could panic. So we need to plan right as at current yield for my age, many properties are cash flow negative due to shorter loan period even though long run I will still be on top.

8. HDB or Private Property Loan

1% rate difference for $500k in simple term is $5k annually. Not cheap. So if I am to take HDB loan, make sure is worth it as it is much more expensive. I don't think it makes sense that people take HDB loan to minimize their chance of returning HDB flat if they failed to pay up. Either they overspend or cannot afford it in the first place.

9. Condo Space

Space is much smaller for New and Private. So if want to stay in one make sure we buy the size we want in number of rooms and total psf. If cannot afford, think twice. However if target rental, not sure 1 or 2 bed rooms are better. I do see quite a number of rent for 3 bedrooms just not as many. Due to gov curbs on number of properties,  getting the larger affordable unit will be a better choice.

10. Home Ownership

Shifted homes from HDB 1 room, 3 room, 4 room, 5 room and Condo. Can be due to family size, estate renewal, working distance, upgrade, etc. home is not forever because is not my experience. We move and change with times and needs. However each time we move, is for better.

11. Invest in Property or Reit ?

I do both. I think maybe good to have at least one rental property income for diversification. Do be prepared for cash flow negative periods due to increasing price. Currently I use a chunk of the Reit dividends to top up the differences.

12. Location Matters

for OCR, Integrated central location, the psf is much higher than 5 min or 10 min away apartment. Delta can be more than 300 psf. However once top, the psf increase for good location increased by 30% with good rental value. So rental investment wise, a key consideration ?

13. Renovation Cost

As condo is half furnished, there is some saving. I do the fan, lighting and curtains. However due to limited space, customized bedding needed for smaller room. In total less than 15k i think. 

14. Store room

Being used to store room in HDB, quite surprise the Condo unit I have do not have one. Many things are thrown before we move in. Minimalist by circumstances ?

15. Weather

Choose the NS direction. There are swimming pools below about 30m away to the side. So is not noisy.

As the unit is inward facing and unblocked, the temperature is quite cooling. However clothing takes longer to dry.

16. Leverage " Demon "

Property is high leverage considering for first property say we pay only 20%. So any gain or loss, magnifies. However there is cushioning from Rental income. Say over 5 year we make 250k for 1M apartment, the money put down including cost could be only 230k. So returns easily 15% annual for past 5 years excluding Rental Support. If we include say 30k annual rental income after cost, the returns  will be roughly = 34% annual ! The range can be between 30% to 40% due to actual sell price 5 years later cannot be confirm .(updated)

I put item 16 the last because I want people to think hard about it. 

Cory

2021-0413

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

Cory Diary : Portfolio Fund Tracker 2021Q1

New chart series for totaled Equity plus investment cash to form the investment portfolio. Since Mar 2020 crash, the market has recovered above the peak level of Pre-Covid. Again time in market is so important. It was early Jan 2019 that the fund crossed 1M mark and now we are already marching towards $1.4M.

Unrealised and Realised P/L since 2017: $355,491

Div since 2017 : $256,415

2021 P/L YTD : $52,784

2021 Div YTD : $9,561

Started testing out in HK market after US Market experiences. So now have exposure in 3 Markets. Next destination will be LSE.

Cory

2021-0409

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

Cory Diary : Retirement Income Sources

Has been squeezing my brain cells a little on how I can stay liquid if I am to retire despite my financial status and investment returns due to my expenses. I am really hard pressed on expanding the list of possible ways. Fact of the matter is I am in good financial health today is because I have a regular job to boost my annual income. Tax will be reduced so I would think my expense will come down if I am retired. So keep this in mind.

In this article I decide to list down all possible practical income sources I could think of excluding discretionary types such as Life Insurance and post retirement salary incomes. They will be more like buffer and back up plans.  Obviously personal loan is not income. Raiding parent home is not counted as it's on parent expenses to generate Rental income but maybe the delta. Inheritance no count as well though the sum could be really good to some.

How about profit from stock market ? I think no as is not guaranteed and I could lose in down years. The return is inconsistent for the past 20 years even though I have relatively sufficient track record as income source. But this can be the engine to build up my dividend base which I could count on.

After listing them in the table, I find it rather interesting. It shows how constraints I am  without regular source of salary income. There are basically 3 main types. Equity dividends, Rental and CPF. Of all of them Equity Dividend is rather important to me. It forms the basis of my retirement funding. Without it in which most locals are adverse to stock market, I wonder how they can do without it.

The 2nd major source of income is Rental. So ability to get more apartment helps except that property curbs have put a stop to this charade. With Covid and constraint on immigrants, this has put a lid on a practical source of retirement income for Singaporeans. No wonder many locals want to try oversea. Maybe I should when I can ! Nevertheless this is a playground to middle income and above generally.

The final major source of income will be CPF. Yes good old CPF except that I won't be able to touch the RA till 65. We could get some interest out from the leftover of FRS to supplement from age 55 though. Keeping in mind BHS will increase till Age 65 so this portion of interests will unlikely be touch for now.

And then lightning strike me that Reverse Mortgage could be a potential source as well. Wonder why this is not popular locally or maybe I am out of touch which is likely. Nevertheless I have no plan currently so is 0 for now. ( Option available )

SSB listed and which provides a baseline stability. It has a cost attached to it though as I could get 5% yield in market today. So the cost probably 5k annually today. If I can plan something, maybe this can be de-commissioned such as additional rental income. 

Others miscellaneous. Anything else ?  Is good to have things listed. 

Thinking.

Cory

2021-0403

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

Cory Diary : Equity Allocation April Review

DBS

Did a couple of key trades recently. One of them is partial sell off of DBS which enjoyed sizeable runs up that also push up STI Index. This is after I have cleared my OCBC after a period. DBS now is less than 10% of my allocated pie in which I still have quite significant exposure. I wouldn't want to sell all because there is good possibilities that it could hit 30 with recovering market in which I am generally positive on the banks. While some other fallen counters recovered in reasonable tandem as well I view them as fundamentally much weaker. So far sale of Bank stocks are more of mitigation moves. If there is fire sales, I would be back at reasonable level. Digital Banking and Blockchain do pose a torn that we have to live with in this investment. This is traded off with potential dividend cap release which might provide a boost to dividend.

ASCENDAS REIT

Ascendas recently weakness provided some opportunity for me to push it slightly above 10%. I am happy with the current yield primarily and of course the recent DCs acquisition. This provide a new dimension or growth opportunities after KDC and then MINT. And only with the backing of strong sponsor do we get to see such opportunity. The only misgiving I have is the merger into CPL as we need to absorb the culture or management which may not be align to Ascendas past glory. So we have to see before any plan to move the allocation further up.

MINT

Continue to pile on this counter on recent weakness as well and together with Ascendas has seen some recovery in prices. Current allocation still has room for more but I won't be increasing much with recent run-up. Is in a sizeable sweet spot in my portfolio allocation above Elite, Cromwell and Aims Apac Reit which are higher yield riskier asset class.

IREIT Global

There is an update few days ago with Deutsche Telekom subsidiary.  At Münster Campus, key tenant will consolidate its operations at Münster North building from 2022 onwards with additional one year lease. Münster South building 4 floors released. The "Pain of Expansion" of footprint into Spain has reduced reliance on key tenants in Germany. Glad that this is done early and not procrastinated. That's what manager is for. We will see how the rest of properties pan out. So far has been positive and I have further increased my allocation into this Reit as their sponsors are more stable. And for the matter, this is also in AK portfolio and my ride with him on AGT feels good. 

Frasers CPT

Have been adding monthly on FCT. Quite positive on suburban mall relevancy to town design. So far their operation is nothing but impressive. Any weakness is good for collection especially in recovering Covid period. If we are to look back at this period in good economic times, the current price will be cheap.

In addition I am also looking into expanding below counters with increasing cash level to increase my current dividend theoretical max of 56k.

Namely,

Elite Commercial Reit - Waiting for opportunity to increase allocation slightly

Vicom - Review next Q report on next more. Potentially increase in allocation

Cory

2021-0402

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

Cory Diary : Saving and Frugality

To start in proper - Saving is the act of spending less than you earn in income, and placing the remainder into a reserve account for later use. How much ability to save ties somewhat to frugality.

Being Frugal

To me it could means minimize wastage. It can be avoiding large wastage of uneaten food. Imagine the amount of saving from uneaten food of each meal as it forms a large part of our basic cost. However, we cannot trade it over balance diet else illness may visit us which will cost a lot more. Fortunately I do not have crave for titbits and soft drinks. So on both health and saving wise, stars are aligned for me.

If we do often enough, drinking Starbuck instead of KopiTiam where the marginal utility may not be very wide for me, saving could be quite significant. Probably 3 times.  So frequency matters in this case. If it provides high satisfaction for your life, do go ahead for your daily Starbuck, while I enjoy my kopi siew tie !

There are items in home we should never brought home. Unused bulky exercise equipment. Souvenirs or tons of  fur toys that we never really appreciate when brought home. I would go as far to include massage chair. That's doesn't mean you should if it does bring you big comfort. Being frugal also means able to focus on big ticket items. If Tesla car design is what you need, while it could be luxury for some, may not be for others. Maybe we can go for Model 3 instead of X. 

To some others could be stringent control of expenses. I find this unnecessary "suffering" for myself. What we need to take is a balance approach in life before our mind get conditioned to think is ok. Some could think that's the way however I beg to differ. People who track down to tiny expenses daily, for years. Take a step back and think, are you the character type that will  spurt or time is better spend else where to grow your income unless you telling me your life is to keep track of such. I close my case.

We should still go for occasional social, cab when is not convenience to use the rail and short holidays. And no way I want to be late for work or appointment just to save on taxi fares. Being early for a meeting may put me in a better shape to kickstart my working day and further my career and therefore income. Once in a long while maybe a delayed major trip. Delay gratification helps but don't push it out too far out. What this mean is we should try to expand our life to some extend to appreciate and enjoy within reasonable budget constraints while we compound our money but not to stop us on to get better on appreciating humanity and cultures.

Things I valued is like walking out in the morning through the garden to freshen up my mind on the way to nearby kopi shop to take my breakfast. I could spend like $5 and enjoy slightly finer things in life. I know some would try to cut down to $2 or have it at home eating bread from QAF. If that's is what one preferred is ok too if that's what you enjoy to do but make sure you do ! A short chat with the stall employees and cleaner brighten up the day.

As one may remember I got a notebook recently after many years till if I find the efficiency beginning to be a drag. Is not like I am stingy to get a new one in a shorter time period but the old unit I had was a power itself for my needs till auxiliary parts start to weaken. And I decided to look for medium range value or better. 

Being excessive in saving habits or subconsciously could have unintended consequences when ones life in earth is limited. And yes we live only once ! So don't waste our life time just to skim in everything or for argument sake in most. Often we are so busy we miss out other aspect of life which form our existence in this world instead of enjoying the process of it. I was single for a long time. While people admired the freedom I had which I do have, deep down in my heart, if I could married and have kids, making like full circle, I would. But I am not going to trade it without getting the right partner. Luckily, I did but is ok if we are not as we will find different option paths of different life and my expenses rocketed. Yup, it REALLY does but I am happy. That's what matter.

Personally, the best way is to find ways to improve our earning and this could be spending more to improve ourselves, skillset and broadening our perspective in life. Looking for way to improve our value in the company and leading project to improve efficiency. Time is money too so we need to watch the fine balance between them.

I come up 2 scenarios of different people just to give us a thought in perspectives. Is not trying to convey spending beyond our means definitely or trying to achieve FI by ensuring lifestyle remains the same after salary tripled. I do not think is ok for one to do that. There is no prize saving the extra Million to beat the others when our life is limited. I am more like Scenario 1 Person 3 in the past. Now working towards Scenario 2 Person 3. Not the exact amount of salary though but you know what I mean. 

To sum up my idea using above table. Using Scenario 1 assuming varied income with same expenses. Person 3 saving is 13 times ! of person 1. This is a little extreme of higher earning but continue to maintain low expenses of one who only draw 3k years ago.

Scenario 2 is where as one income grow, we adjust our spending. Person 1 in this scenario tried many means to squeeze saving.

Scenario 1 of person 1 and Scenario 2 of Person 2 and 3 are options we could possibly choose. Lesser saving when one is earning less, by proportion. And adjusting for better lifestyle when people earns more. We still ride on larger absolute savings. That's what earning more is about, winning both ways. The Way of life.

Cory

2021-0104

Cory Diary : Historical Milestone - Net Worth

Asset Class diversification is important for peace of mind. It can be Equity, Bonds, Property, Cash, FD and diversification within like for example recently I expanded to Euro and Pound denominated Reits in Europe properties. I also developed a plan entering into US market by mini portfolio even though timing could be better. Bonds wise I have SSB Max and in the work to reduce Company Bonds for CPF.

One of the challenge will be how to Simplify my operation while achieving the Diversification needed. This means reducing errors, market volatility with poor quality assets and getting better in my investments. And therefore more time for family and work.

To combat inflation, having investment returns and also a shelter over my head when needed, I decided to invest in Property. This allows me to sold off all my gold position which serve inflation purposes. In my earlier article I have worked out the Math on why property investment is attractive due to Rental income and leverage. TDSR and ABSD have also limited over speculation so one is unlikely impacted by installment arrears. Even if one got their timing wrong, over the long term the return from rental or own stay which avoid paying rents, will likely gives property buyer a high chance in the black and probably good returns on average. 

To add for residential property, I feel is very unlikely to have EHT or Noble events that we see in stock market as long we can hold our property. Being in equity market over decades, property is certainly the easier path to go and imo for most people who can afford, within the current regulatory constraints that interesting help largely minimize the risk of default. The stock market is not a level playing field even though over the years we are getting better. Is much tougher to profit from it with many learnings needed to stay in the game even though I have profited some amount. 

Why all the write up above with the subject line. I just checked URA transactions, and PSF wise there is another increase on recent month. Is a surprise. Covid ? What Covid ? This bring my Net Worth to another magical milestone level. Interesting just yesterday, I told my wife that if I hit the Net Worth milestone, we can afford to buy another larger de-humidifier. It was a passing remark as it will be our 3rd in the home. So if we going to get it, and the stock market doesn't look like will push it that far in the next month or so, it could be far fetched. Looks like is not far enough ....

Cheers

Cory

2021-0331

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

Cory Diary : Home anytime ?

When I was developing my retirement datasheet, one of the most influential item is housing loan. It takes a big chunk off my saving. Therefore if I could, I would prefer to borrow for the longest period like 30 years whenever possible so that it reduces my monthly or annual drawdown as I build up my others. And that's me. Of-course like many things in life, people have choices to their preference. Some want to pay up asap. Some won't even buy a home unless they can fully paid a home upfront. They are either from Mars or never able to execute to the plan they wanted. Obviously I do not mean either only. There are many options and rationales and I wouldn't feel like stepping on anyone toes.

Spikes follow by corresponding reduction Chart

There are also others like me that are more conservatives ( Relative term for one who invested more than a 1M in stock market ) or them ( looking at property agents ) who will tell you that for stay, buy anytime. Personally, anytime ? Absolutely rubbish imo.

Home is the most costly and one of the most important asset to most people.  Just have to give an example. If you see a price chart where the price spikes like a needle, good luck to those who follow through their life time deal. Hopefully you won't have to work on the remainder or big chunk of your life time to save the differences !

So is it a good time to buy now ? Your guess is as good as mine. I like to know too ! but I would take a home anytime for a reasonable price after glancing the chart or table or whatever ....

Cory

2021-0321

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

Cory Diary : Financial Updates

Salary

To most people, the largest impact will be Salary Income. Well, at least for my generation. :) Within the organization we have been asked to prepare a small list for possible retrenchment if there is insufficient attrition. This is not like we are doing bad. The company is doing quite well but I guess the top management always like to see constant lifting of performance bar, talent flows, cost structure etc. It does cross my mind whether should I ask for voluntary however money is always not enough even though financially I am quite ahead on average. 

I am now in the mode to work as long as possible as I am on my comfort pace. The idea of constant cash injection into my saving account, occasional Bonus and then Stock rewards in-additional to other benefits can be quite "addictive" rather than the fear which I think always lies right at the bottom which will surface occasionally when I feel not enough money to invest. To put in easier context to understand, every month of work remuneration equals to a paid holiday vacation for the family. That's how hard to let go.

In-addition to that, able to contribute actively in the workforce and seeing products you are part of is always fulfilling other than being in constant InTouch with the industry and people. Often as well the satisfaction of able to lead and guide members of my team and colleagues will feel rewarding as it does need certainly level of seniority skillset often lacking in the company. I have seen people who work on projects for many quarters when the scope is not really practical or required. This is a sign of lacking experience people who can close them in minutes. So much effort spend on useless projects. Maybe there are too many Project Managers just to keep everyone busy and paid.

Asset Allocation

It has been some time that I have not been Tallying up my asset. I feel the need to do this to move forward as there are competing areas we need to review, balance and invest. Cash, salary, dividends, trades, loans, credit, local/oversea, current/non-current are all the moving parts. How much buffers or spare cash after emergency, housing etc. There are many saving and investment accounts to check. Basically it boils down to Cashflow and Return. To move I need to have a good view on past and current for the future. This is how I derive my Total Net Worth too. Asset wise reach ATH due to gain in company stocks else I think is a flat quarter. Kind of lucky.

There need to be comparison when I talk about adjustments. Here's the previous post. ( link )

Investment Accounts

There's a decrease in investment account as I invested more. Cash is up too. So Probably I could re-balance them. Fixed deposits are now mainly in oversea accounts as I plan to eliminate most of FD locally. Emergency cash is now saving cash. Similarly, Bond will be on downtrend except for SSB which is under Gov securities.

CPF

CPF has expanded due to top ups. And this hope to be annual affair before Age 55. I plan to try out SA investing just to have a good ideal on the Shielding Process. Overall, CPF is a portion of retirement plan and my expectation is Stock will really be the key after I retired.

Expenses

There is a few big ticket items. One is I feel Rei needs a boost in immunity and decided to provide her a RSV. 1K cost in nanny for each girls. A coway air purifier. Coming expenses will be new set of clothing for Xin as she has reached 2 year old. Tax Payment. Have been contemplating to move to a larger apartment but currently at back burner. This could change anytime.

Tesla

I did a quick glance through the recent correction in US Market and most of the spike has been worn off and is back to the manageable slope of growth path. Having step into US market proper, there are opportunities that I could setup more funding on them. One of my favorite is Tesla. Right now the invest amount is minimal but I could expanded my investment exponentially if opportunity arise. Market can still come down as valuation wise is still quite rich across the board.

Tesla is already a profitable company in 2020. However, the profit looks emerging which means trying to use PE to rate them will give you a very high value which looks very expensive but misleading. Price has swing down from 800s to 500s and back up to near 700s. The swing is wild which I never expects that being new to this market.

For Tesla current PE ratio is 1083. Astronomical number. However the earning could doubled quickly from 0.64 to 1.28 and the PE could come crashing down to 500s. I am not saying it will be this for sure but for a high growth company which is just profitable, the potential is there. The EV Car is real and selling well and limited by it's production capacity. Is a calculated bet as they are a prime mover of the industry just like Apple on Mobile Phone. You know they are doing well when there aren't need for Sales People. The signs are all there of a successful company on a path of prosperity.

I am quite excited with US stocks even though they are still a small portion of my overall equities.

Reits

Singapore Reit market has been shaken by recent yield spike despite the overall yield is still very low in the grand scheme of thing. So I am quite confident to continue to add. The Reit yield is now quite attractive for example Ascendas and MINT both hit more than 5%. I did a timing trades selling significant portion of my Ascendas when the price peaks to a point I sold too much and need to buy back some just in case I am wrong. That's a good move this Q1 and has been in buying back mode since. That's a few coway saved.

Later batches do takes time to build up as purchases are spaced out in case the retraction drawn out is long. I do not want to be a in situation that my precious fund dry up too early which will be bad for the mean values and missing out a much better yield returns. This also helps to maintain sufficient War Chest which are pooled together not to get depleted before any major crash.

Trading Accounts

Finally, to make thing slightly complex I have a few trading accounts. Trading cost is now a growing concern for me as this point of time. I have been using DBS Treasure for a large portion of my trades now. The transfer of fund is also make easy being connected to the saving accounts. However for US trades I am still going through Poems - Cash Management. We will explore later as we grow over there.

Dividend

Dividend wise for Q1 is a little slow. In summary. Take this with quarterly and half yearly in context for different stocks. Theoretical max is now $57k annual as each time there is market draw down I will start buying bigger which helps to boost my dividend. I hope to be able to achieve $60k mid term.

Syfe

Starting to explore Syfe and probably a few more similar products if any out there for diversification. This is more for legacy planning on how my family can continue to invest in a more assisted way. And will likely to do some try out as this will be easier for wife to manage instead of stock pickings. I have never been keen on Unit Trusts as to me is a black box that can be easily manipulated or affected by a few individuals. I could be totally wrong on this perception but I will still be ok. Robo Advisor platform maybe a new dimension of investment which seems much better, harder to be manipulated and we have more controls. Anyway i could be wrong but is first step in learning.

Cory

2021-0316

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

Cory Diary : Portfolio Updates

Recent adventure in US market is not good as tech starts to correct. Even though I was prepared that this could happen with mitigation strategy, the cost is still quite painful and feel timing ( fate ) could be better. With US treasury yield continues to rise, both bond and equity broadly are coming down the same time while mainly banks stocks move up. Stock and bond prices usually move in opposite directions. What will Fed do this time ? Nothing so far unless it spreads to destabilize the value market I feel. Tech stocks are in bubble territory so any correction to them is very welcome to Fed probably. 

My portfolio is now segmented into Bonds, SG Core, SG Reits and US Stocks. At this moment is lagging behind recovering STI index by a few percentage points as market moves to value while within Quality Reits get hammered. On dividend plan, the portfolio target annual dividend max of 55k is completed. ( Slightly higher than year 2020 in sustainable basis). I also build up a warchest of about 9% of invested portfolio value for quick deployment if needed. 

So with above in context, what's my take now ?

Bonds ( Orange )

With the recent maturity of CMT 3.08% bond, I am now left with 3 bonds. As previously mentioned, my plan is to have CPF be the "bond holding" of my portfolio and therefore this bond segment will be phased out and not be tracked in portfolio as CPF size will be expected to be large enough to skew the tracking of risk, yield or returns. However if I am to invest my CPF cash later, then they may return into the portfolio to be tracked. This transition phase could release more cash as I am limited on how much I could top-up my cash into CPF annually.

Reits ( Green )

Expanded to 9 Reits. Almost added Frasers Logistic and MLT but decided not as is still too expensive despite recent correction on quality reits. This is based mainly on yield/risk. I have a theory that the recent Reits volatility is due to flight of funds from strong reits who are competing with increasing bond yield. So at appropriate time maybe good time to scope this class of reits.

Elite, Cromwell and Aims Apac are considered higher risk in this Reit segment so their allocations are lower with higher yield. IReit however is allocated higher because I have AK backing. hahaha. This class of higher risk reits can do wonders to your dpu but occasionally "bad news" will strike them. Is important that we diversify to more of them and to filtered out similar or even riskier ones. So far exclusion list ESR, Sasseur Reit, First Reit, LMIR, Hospitality. Do note this article is not a thumb down on them but their uncomplement to my invested list. haha

Core ( Blue )

Sold OCBC recently to lock in profit as I feel there is enough DBS allocation to ride through the market. This also mean is much harder for me to sell DBS now considering it has been a strong balancer of losses in other segments this time round. I like SGX and Netlink a lot but there is limit of allocation which I do not want to over-expose to. One interesting stock is Sheng Siong which I am buying back at higher cost but at much smaller amount.

Recent adventure in US stocks ( Pink )

If we could remember I laid out a plan to invest in US stocks at a time when the market is quite high and was careful to make sure this is mitigated. I planned a 5 steps allocation approach to increase my allocated investment. The first step was implemented, and together with previous US shares not tracked earlier, constituted about 4.5% of my investment portfolio now. 

And then the US market starts to tank, and the whole process stopped at step 1 which is less than 5% of investment portfolio. If the 5 steps are done, I would have reached 25% allocated investment. Bad timing ..... on my diversification plan but it could be worst. I would hold them and see how far the correction goes. Being used to dividend investing, such volatile movement is something i need to learn. Some school fees need to be paid. Is a very good learning experience with skin in the game.

Chances are I will invest more into US market in the future. PLTR, Nvida, Appian, Amazon, FB are interesting list in-addition to existing.

Cheers

Cory

2021-0306

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

Cory Diary : Life getting to Normacy

2/17 is Special. The Day we carried Younger Rei to Nanny Place. She is almost a year old now and we feel comfortable she is ready to survive out there. Taking care of baby Rei the first year has been an Arduous journey as she was pre-matured and need much more special care. This make me realised that we have been fortunate on our first and never fully walked away with a "Credited Parent Badge journey" till now.

Interestingly, when we first has Xin, I thought bringing her up is not easy. Schedule is really full. The only truly rest time I have is like a midnight 5 min walk to a local 7-11 to take a sip of coffee while browsing through the internet. Rei up my time management capability that feels like "Tripled". So Xin is really a walk in the park actually. This further reminds me again that we should never take things for granted as it can be a lot worst. ( "Trembling laughter" )

Rei is slow in learning to crawl so Doctor recommended that she goes for some therapy to let her catch up physically. Each time I am there, there is sense of guilts to remind us that we did not provide equal amount of playtime for her that a Good Nanny plays. And this can further be attest when just a few days under a Trained Nanny care, Rei shows significant improvements in her phys.

As for Physical Therapy, not often seen and hidden from social visibility, there is group of children of various disability undergoing therapy as well who needs much more help than we are. And here I am feeling fortunate and uncomfortable to take some time away of the trainer the unsung heroes, and high praise for those parents who never give up on their child. Some of their journey is really tough and will need a lot of helps from Relatives, Friends and the Society.

With Nanny helps, now we all have more time for ourselves and another monthly budget cost of  $1,000. But I can tell you, every cent is well spend. One of best investment even for working Stay-at-Home parents. 

Humbled.

Cory

2021-0220

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

 

Cory Diary : Investment Strategy

Today topic is a little broad as it covers overlapping action, strategy and performance of myself due to my personal circumstances. So I thought a new header is needed that best summaries the scope. When I first embarked to learn more about CPF never do I know it can become one of my segment to replace my bond investment. There is always misgiving because the governance is by our Government, that we can't trust them. 

This is best summaries by Tan Choong Hwee, a Guru in CPF on below viewpoint.  And I wanted to take pain to emphasis the non-partisan perspective that we need to look at when come to our financial well being. And I wanted to share this such that everyone has an opinion that we can listen and need not necessarily agreed such that we all grow as a better person.

CPF

"Look at this in another angle. Do we realize that we are trusting someone/something where we park our money?

- Deposit in bank:   we are trusting the bank to do its job well of keeping our money safe and paying us interests.

- Invest in stocks/bonds/unit trusts/ETFs/crypto:   we are trusting the counter party in handling our investment and paying us when we liquidate our investment.

- Invest in insurance policy:   again we are trusting the people involved (insurance agents, financial advisors) and the insurance company who offered the policy.

- Invest in property:   we are trusting the agents/lawyers to do a proper job and the transactions are genuine (not fraud).

- Keep in Milo tin:   we are trusting that nobody steals it nor losing it to termites and fire.

Do you think we ever have full control of our money? Trust is paramount in the whole monetary system.

And who do you trust more? Government, companies or individuals?"

Here's my Asset allocation.

Past months I have actioned quite an amount of steps to ensure baseline plan is done for my CPF which I have neglected for long time. Here's the page link. On another perspective, CPF in total is less than 10% of my asset today. So there is also mitigation in-place if I am wrong like any investment plan. I hope to do another 4 years of VC3AC to the max limits allowed. And in my case due to continue employment and investment, the percentage may not grow in term of asset.

Equity

Equity has come down slightly to my surprise as I started Growth Journey in US market. In my personal opinion, the market is really elevated and quite high risk to buy now. My early article on 5 steps strategy is to allow me to have a toe in there while I took profits on some local shares increasing my investment cash account by about 2 points. Saving account by 1.5 point.  My concern is that if the US market is to crash, SGX will do no better and I can utilize Warchest to benefit from it hopefully.

Performance

The first month of Year 2021 is interesting. At one point STI is well ahead before it pars down by early Feb. Market continues to be listless even after Trump as Market seems not really excited with Biden as everyone has hoped for despite democrats holding all the cards now.

In term of currency exposure, I now have more Euro, US and Pounds denominated stocks. This is more due to local reit asset yield is low for those strong Reits. To bang the buck harder, reits with oversea asset looks more attractive. However I have to make sure the amount of each allocated is not significant enough to cause me worries.

Core sectors such as DBS, Vicom, SGX, OCBC and Netlink BNB Tr are holding up well. Growth segment wise is still relatively small and currently has a slight positive in net. I hope the market allows me to grow some more before the omega happens if it does. The growth gives the portfolio edge in worldwide diversification and more long term growth.

With that my portfolio now consist mainly of Core, Reits, Growth and Transition-in-process from Company Bonds to CPF.

Cory

2021-0206

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

Cory Diary : Growth Stocks

One thing I learned from 2020 is that we are who we are. They are people who can invest just 6 stocks with solid returns. There are ones who only need to do 1 with 500% returns. Everyone situation is different and so are capability. If we are to blindly follow the setup of others we will always be chasing the "dragon" in the cloud and capture nothing.

After years mainly in Dividend Investing, the magnificent rise in growth stocks tell me there could be opportunity that I can learned from it. Some of this growth tocks have widely diversified market and moat. So is not exactly just Growth. A good example is Microsoft where their applications are widely available to PC users. They are basic productivity tools we can't do without.

Microsoft from Wiki

Products

List of software : Windows, Office, Servers, Skype, Visual Studio, Dynamics, Xbox, Surface Mobile

Services

Azure, Bing, LinkedIn, Yammer, MSDNa Office 3652, OneDrive, Outlook.com, GitHub, TechNet, Pay, Microsoft Store, Windows Update, Xbox Game Pass, Xbox Live

Investments

https://en.wikipedia.org/wiki/List_of_investments_by_Microsoft_Corporation

Microsoft Assets are stellar long term. https://www.macrotrends.net/stocks/charts/MSFT/microsoft/total-assets.

Microsoft just reported good result. I am not sure at current level is worth a buy. However long term they will be around. They aren't Tesla in term of growth but certainly a step up to me before Tesla. 

Investment Strategy

Current USD is relatively weak. Which mean a good opportunity for currency conversion to invest new. However Tech Stock price is quite elevated and we could see correction upon entering the market.  

My strategy will be get some first, say 20% of the amount I planned for this counter. If the stock moves much further up and the climb is not spike, I can average up another 20% and so forth. If the stock goes down, I will wait for sufficient time before averaging down another 20%. In that way I started something and build up the position accordingly. So is a 5 stepping methodology and we can varies as we deem fit.

Make sense ?

Cory

2021-0129

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

Cory Diary : CPF - My First VC3AC

As remembered, after completed all my Voluntary Housing Refund (VHF), the money goes into CPF OA. ( VHF is to return all the money loan from my CPF OA account to buy housing ) .

To get higher interests, I have it moved to CPF SA which has Max limit of 186K (FRS). This is through CPF OA to SA Transfer. There is still a little room for more and as earlier blogged, after selling my Singtel discounted shares, the money also go to CPF OA. I have it moved to max out to current CPF FRS allowed.

Then after, to increase my SA further allowed other than through Salary Income, I will need to proceed with Voluntary Contribution to my 3 Accounts (VC3AC). There is no tax benefits for this step. The key benefit is to get access to CPF SA 4% Interests. The ratio distributed to my CPF accounts are as follows.

Now at age 51, I am in golden age group where my top up matters if I want to focus on CPF SA. The max limits allowed is $37740 including Mandatory Contribution (MC) from income such as salary. With SA allocation as above chart at 31.08% of every dollar top-up. I can do this for 5 years till age 55.

And I did my first VC3AC as follow.

The ratio is as expected. And this can be seen when we login to the CPF website from above chart. So my CPF SA will now be 186K + 1473.19 = 187473.19.

One thing to note is that if CPF MA hits BHS limit, the excess of it will flow in CPF OA per my understanding. "Once CPF members reach age 65, their BHS will be fixed for the rest of their lives. The prevailing BHS is $63,000, and will be adjusted yearly. "

Final note if we exceed annual limit of $37740 due to VC3AC, it will be refunded without interests. So if we are still getting MC for rest of the year, you will exceed if Top-Up already maxed.

Cheers,

Cory

2021-0127

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

Cory Diary : Trading Records 2021-0122

A little motivated with my new Notebook and keeps looking to squeeze out time to play with in-between chores. One of my favorite app is Chrome Browser and for some reason my tradingview chart aren't showing the numeric values. After figuring out for some time decided to re-install the Chrome browser and without full screen extension. Looks like problem resolved. Phew. Now I will continue my trade reports.

CICT reported their number. Looks like it doesn't meet market expectation and there is some shading. I have some stakes in the stock for long term so kind of amuse with the market sentiment since they are still in rebate mode. It has rebound quite an amount recent weeks since adding some more shares at low below $2 last year. When I look at the TA, looks like it has hit the peak. I refused to sell and this caused me to lose some capital gains. Reduced some today as I soon realised my exposure has been quite much now and this allows me to re-deploy some of the funds. I still hold a good amount but no longer blink when I see my galaxy chart. It is still a recovery counter but I think it may take some rest before moving forward again. Singapore and Malls cannot go away.

Sheng Siong has shown indication of good result by the amount of bonus they have declared for their staffs. So is in a hunch that I think their result probably is good so decided to add some more to my current position. Is still relatively small. But for a portfolio of mainly banks, Reits and some blue chips, they are welcome addition. I use to hold quite an amount in this counter and profit wise is one of the best preforming after Singtel during it's heyday. I like the business as they are not only profitable but also a household name. One thing I find excited of Sheng Siong is that their online business which complement their overall fulfillment. Looks like they are well managed.

There are a few stocks which are really hot in the SG market right now. iFast, Nanofilm, SGX, ... and there are also quite a number of penny stocks animated to my dismay. While the more established stocks can be hyped, they are still good business fundamentally behind it whereas penny stocks always give me the impression that they are heavily manipulated through forum, news or analyst reports. When things start to die down, retailers again will likely be hanging up there dried ... . Anyway I decided to buy Nanofilm to satisfy my itchy fingers.

Finally, I did a quick Buy/Sell trades on Boustead for kopi. Decided not to hold another "Reit" like counter since I have much of them. People who get them hope for a further re-valuation. I decided not to wait.

Cheers

Cory

2021-0123

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

Cory Diary : Value Notebook to continue my Investing Journey

My Struggle

Old workhorse that helps me to earn hundred of thousands will be decommissioned from active duty. The keyboard was broken with the caps falling apart for a few years already but I was reluctant to repair or change instead I spend like $25 bucks on a wireless keyboard as workaround. On/Off the wireless will stop functioning but due to the SSD drive, the reboot often fixes it quickly.

The machine is HP Folio 13.3" for 7.5 Years. Slightly more than $1k as it was an exhibition set for already 6 months. Yeah I am that "Value". Weight about 1.5kg which is quite heavy for mobility use. My back not helping. And then the SDD is only 100GB which in today standard is not enough. Period. 

I also did a self-upgrade on the memory. It was a harrowing experience because I basically have to tear the machine apart to slot in the new memory stick which is behind the mainboard. Finally got it working and when I put them altogether, I found a few screws to spare that I decided to do away. Maybe I should add a badge for putting humpty dumpty back again on my blog wall.

I have been struggling how to manage it every time there is a major app installation considering Windows OS easily takes up more than 70% of it spaces. The software was upgraded on courtesy of Microsoft from Win 7 to Win 10 even though I preferred the older version. The touchpad is hard to use. I am not sure was it after long years of service or what, as I could not remember but mouse is a must to navigate around the workspace.

Finally, as is a consumer unit, the screen is very crisp, it lit very well and so are the reflection. The brightness getting more and more intolerable. Often I feel my eyes aging on me. The last straw is the power adapter is connecting loose to the machine. It will slips out if I move my notebook a little and need to remind myself to ensure is plugged as the battery aren't pristine anymore. I guess the friction is gone.

Delay Gratification

HP ProBook AMD Ryzen 13.3" 

Despite record returns in 2019 I did not budge. Decided during Covid Year that if I do get a decent profit I will seriously consider to get a new computer and I achieved. With the amount of time facing the computer, there is list of requirements.

1. It has to be SSD drive. Speed of booting up is superb but most importantly the media reliability. How often has hard drives failed on us and we loose everything.

2. 1TB sounds good. A 10x upgrade. I would be happy to pay a little extra for 2TB if there is a SKU for it but there aren't for the range I am looking at.

3. Long battery life like more than a day. At least can last my "World Tour" in flight.

4. Click feel keyboard to register my feel.

5. No Built-in ODD of-course . I want it slim and light ! 1 Kg is nice. I painted this exact goal by the way. Just want to be able to carry around with me even to the Everest climb I think.

6. Display with little reflection. Eyes are important. The size has to be 13.3" for my preference.

7. CPU speed that allows me to game like AK ! Forget about Intel. I want AMD for the Class. I feel the Emperor has been dethroned.

8. Type C USB for charging is the norm nowadays which is what I wanted.

9. Ya has to be Windows. We have a love hatred relationship. But I am not a Mac guy. Is too late to re-learn for me for better or worst.

10, Fast USB speed. This will save a lot of time backing up and transferring data. Time is money especially when we are dealing with GBs of data to manage. No clouds for me but maybe I will evolve later.

And I found HP ProBook 13" AMD Ryzen 7 4750U 16GB 1TB / Win 10 Pro. It comes with fingerprint sensor. I blocked off the cam on first use and disabled the location. I also prepared a recovery USB drive immediately. Fortunately, the touchpad feel is good without need for a mouse. For $1.8k I think this is a Value Buy. Happy Buy, Happy Man, Happy Investing. My dear says finally.

Cory

2021-0121

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

Cory Diary: Year 2021 Portfolio Strategy

Building Up of CPF and The End of Bonds Age

With the portfolio growing, emergency funds filled and cash increased, and finally the focus of CPF returns supporting retirements, is time to slowly phase out Bonds managed in the portfolio. As CPF is not tracked in active portfolio, we will be expecting higher yield moving forward with higher volatility.

So why the focus on CPF.  Stability of the returns, and roughly 4% XIRR. This beats many bonds.

Furthermore, with locked mechanism or restrictions in CPF, I view it as positive. In-addition to that, it can also be a good holding place for extra cash in OA to be withdrawn as needed after 55. Yes, rule will change but usually is for the better or rational reason. Nevertheless, is prudent not to solely depend everything on it.

This will formed a solid base and a release of 1/4 M to more active investing. The plan is to do more cash top-up via VC3AC for the next few years as I hit FRS.

Investment Accounts

Fixed Deposit is so yesterday especially in foreign currency as there aren't much good ones after AUD/NZ dramatic reductions over the years. For local currency, the only place will be temporary holding. So basically cash is best placed in investment holding accounts subject to safety of assets consideration. I hold the view that we should not be fully invested unless we are really good in stock picking. I am not there yet.

Most of equities invested are cash flow generating for dividend.

US Investment

Have some shares in US which has seen almost doubled in returns over the years. I think is time to slowly sell them off with the rising market. However I need to get my W8BEN renewed. They aren't tracked in investment portfolio. Compared to more famous stocks like Nvidia or Tesla, this returns frankly is mediocre LOL. What a time !

If there is a large correction in the US market, I may consider some investments over there.

Chicken Genius

I watched the Video from this local man in utube who make millions from Tesla. Strike the cord that we have to invest into Needs of the World. I think this makes perfect sense. The result could be long term. Of-course is in context.

For example I would think Nvidia provide high end solution to Bitcoin farming machines, high end graphics and Gaming. Covid helps to push it up another few  levels. There's a need for it. There  aren't strong competitor. 

Growth Allocation will be opportunity based.

Cory

2020-0116

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