Portfolio Review 2Q14

One transaction completed:

1. Sabana

• Buy
  First Syariah-compliant REIT here in Singapore
  Luck with IPO balloting for public (see Sixth time (un)lucky)? entry)
• Sell
  Decreasing occupancy rate and dividend payout
  Rising gearing ratio

Currently holding on to 10 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5, Portfolio Review 1Q11 for 6, Portfolio Review 4Q12 for 7, Portfolio Review 2Q13 for 8 and Portfolio Review 4Q13 for 9):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Cambridge
7. Sembmarine
8. Croesus RTr
9. CDL HTrust 
10. OUE HTrust 

• Buy
  Positive on Orchard shopping belt
  Stable price and dividend payout

Next portfolio review due after 30 September 2014.

Note to self: only simple P/L calculated

Portfolio Review 1Q14

Currently holding on to 10 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6, Portfolio Review 1Q11 for 7, Portfolio Review 4Q12 for 8, Portfolio Review 2Q13 for 9 and Portfolio Review 4Q13 for 10):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
8. Sembmarine
9. Croesus RTr
10. CDL HTrust

Next portfolio review due after 30 June 2014.

Note to self: only simple P/L calculated

Portfolio Review 4Q13

Currently holding on to 10 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6, Portfolio Review 1Q11 for 7, Portfolio Review 4Q12 for 8 and Portfolio Review 2Q13 for 9):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
8. Sembmarine
9. Croesus RTr
10. CDL HTrust
    • Buy
      Positive on Maldives acquisitions in Jan and Dec 2013

Next portfolio review due after 31 March 2014.

Note to self: only simple P/L calculated


Reflections
Towards the end of 2013, I have been seeing rather a lot of talk about rising interest rates going forward, and how this is likely to adversely impact REITs and bonds going forward. Naturally, this drew my attention as a vested investor.

Nonetheless, I am inclined to sit tight at the moment. Nothing too scientific, my gut feel is that this is likely to be a gradual trend more than a sudden jump, future US Fed announcements notwithstanding (more like market noise to me...)

Over the past year, portfolio value has certainly taken a hit, will be looking to pick up more of some counters which I am more optimistic about.

With the benefit of hindsight, current level of passive income is comfortable but has not been increasing as fast as I had hoped. Shall be aiming to achieve an extra 1.5-2 months of "extra pay" through passive income in the near time, wish me luck!

Happy New Year and a great 2014 to all !!

Talking about personal insurance

Nearing year end, I have been approached by a number of insurance agents recommending me their companies' products. That got me to look at my existing portfolio (something which I haven't done in quite a while!)

After some research, I found that insurance can generally cover the following areas (disclaimer: to the more sophisticated, please pardon the simplification) -

• Death - this can take a few forms, such as term life or whole life participating policies.
  A term life policy pays out the sum insured upon death.
  With a whole life participating policy, the sum insured is paid out together with a 'bonus value' (accumulated over the years) upon death. Alternatively, one can surrender the policy at any point whereupon he or she will receive the 'cash value' of the policy. For this, one should note the 'breakeven point' of the policy, which is the point where the cash value (which builds up over time) catches up with the cumulative premiums paid. Nowadays for paying of premiums, there is the option of 'limited pay', which means that instead of spreading out the premiums over the entire duration of the policy, one can choose to front-load the premiums over the first e.g. 10 / 20 years, albeit at higher amounts of course.
 

• Total and Permanent Disability (TPD) - in most cases, this is usually tagged along with death benefit, meaning that the sum insured will be applicable for death and TPD.

• Terminal Illness (TI) - this is paid out when the person insured is declared by a doctor to have a condition which is likely to lead to death within 12 months. As with TPD, TI sometimes accompanies death benefit.

• Critical Illness (CI) - based on my understanding, the list of insurable critical illnesses has been standardised to the current 30 by the relevant authorities and now applies to all insurance companies.
  CI can be standalone policies (more pricey?) or as a rider to life policies.
  Since the case of Theresa Tan, there are now also early critical illness plans which cover the early / intermediate stages of the list of 30 CI, the most prominent being that of cancer. As a comparison, early CI pays out (up to $75k) even when diagnose with benign tumours while CI only pays out if it is malignant or invasive in nature. Note however that early CI can be more expensive than CI since there is a higher chance of payout.

• Accident - personal accident plans are relatively cheap (in the order of a few dollars a month) and pays for TCM and for e.g. loss of limb, etc.

• Hospitalisation and Surgical - in Singapore, this is covered by MediShield (which can be paid for from Medisave Account). Personally, I feel that this is probably one of the more essential types of insurance for protecting oneself and one's families, and had discussed this previously.

• Disability Income - this kicks in when one is declared unable to work as a result of injury or illness (I was quoted hand injury in the case of a surgeon and depression in the case of an office worker as examples), and will pay a monthly amount in place of the salary which one would have been earning. These are highly customisable - for instance, one can choose the amount to be paid (up to 75% of last-drawn salary), paid up to what age (e.g. 60, 65, 70), and the waiting period before the payouts start (e.g. 60, 90, 180 days).

• Savings - an example is an endowment policy which pays out upon maturity. In most cases, this is used to help meet a specific financial objective, such as saving up for children's education.
  
  
• Investment - an investment-linked policy (ILP) allows one to practise 'dollar cost averaging' and build up a position in a desired asset class / geographical market by putting in a regular fixed amount each month. I had shared a little personal experience of this previously.

Of course, the above descriptions only scratch the surface of the full complement of insurance policies available. Nonetheless, I figured it was important to understand my options and from there assess what is my own comfort level - how much am I prepared to pay for insurance (just to share, I was told 10-20% of my income as a rough gauge) and how much would I like to be covered for? As with buying anything, there will be the cut-price option and the cut-throat option... Feel free to share your own experience :)

Kindle Paperwhite

Disclaimer: This post will have nothing whatsoever to do with investments.

Recently got myself a Kindle Paperwhite with the help of a friend living in the US -

And with a few pre-selected titles in my head, plus the help of my colleague who pointed me to:

1,001 Books You Must Read Before You Die

I then set about constructing my own reading list:

1. American Gods (by Neil Gaiman) - read
2. The Picture of Dorian Gray (by Oscar Wilde) - read
3. The Great Gatsby by (F. Scott Fitzgerald) - read
4.  The Brief Wondrous Life of Oscar Wao (by Junot Diaz) - read
5. The Curious Incident of the Dog in the Night-Time (by Mark Haddon) - read
6. Ender's Game (by Orson Scott Card) - read
7. Ender's Shadow (by Orson Scott Card) - read
8. Neuromancer (by William Gibson) - read
9. Snow Crash (by Neal Stephenson) - read
10. Cloud Atlas (by David Mitchell) - read
11. 1Q84 (by Haruki Murakami) - read
12. Kafka on the Shore (by Haruki Murakami) - read
13. The Restaurant at the End of the Universe (by Douglas Adams) - read
14. Life, the Universe and Everything (by Douglas Adams) - read
15. So Long, and Thanks for All the Fish (by Douglas Adams) - read
16. Mostly Harmless (by Douglas Adams) - read
17. The Ocean at the End of the Lane (by Neil Gaiman) - read
18. Stardust (by Neil Gaiman) - read
19. Five Little Pigs (by Agatha Christie) - read
20. Hercule Poirot's Christmas (by Agatha Christie) - read
21. Go Set a Watchman (by Harper Lee) - read
22. Watership Down (by Richard Adams) - read
23. The Big Short: Inside the Doomsday Machine (by Michael Lewis) - read
24. Anansi Boys (by Neil Gaiman) - read
25. Neverwhere (by Neil Gaiman) - read
26. Colorless Tsukuru Tazaki and His Years of Pilgrimage (by Haruki Murakami) - currently reading 

Welcome any views, cheers =) 

Stock & Unit Trust Portfolio Update Aug 2013

Continuing on from Stock & Unit Trust Portfolio Update Apr/May/Jun 2013,

• 6 Aug 2013
  Added to Croesus RTr existing holdings
• 14 Aug 2013
  Added to Cambridge existing holdings

Portfolio Review 3Q13

Currently holding on to 9 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6, Portfolio Review 1Q11 for 7, Portfolio Review 4Q12 for 8 and Portfolio Review 2Q13 for 9):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
8. Sembmarine
9. Croesus RTr  

Next portfolio review due after 31 December 2013.

Note to self: only simple P/L calculated

Portfolio Review 2Q13

Currently holding on to 9 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6, Portfolio Review 1Q11 for 7 and Portfolio Review 4Q12 for 8):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
8. Sembmarine
9. Croesus RTr
   • Buy
     Renewed optimism in Japan from Abenomics(!)
    

Next portfolio review due after 30 September 2013.

Note to self: only simple P/L calculated

Stock & Unit Trust Portfolio Update Apr/May/Jun 2013

Continuing on from Stock & Unit Trust Portfolio Update Mar 2013,

• 17 Apr 2013
  Added to SembMarine existing holdings
• 6 Jun 2013
  Added to SembMarine existing holdings
• 11 Jun 2013
  Added to Sabana existing holdings
• 12 Jun 2013
  Added to Cache existing holdings

Stock & Unit Trust Portfolio Update Mar 2013

Continuing on from Stock Portfolio Update Jun 2012,

• 7-8 Mar 2013
  Stag Mapletree Greater China Commercial Trust IPO on second day of trading

Portfolio Review 1Q13

Currently holding on to 8 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6, Portfolio Review 1Q11 for 7 and Portfolio Review 4Q12 for 8):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
8. Sembmarine

Next portfolio review due after 30 June 2013.

Note to self: only simple P/L calculated

Passive income for retirement

Retirement with a fairly stable stream of passive income has been the basis of my investment aspirations.

When I first started, I had set a target for annual passive income which I felt could support my retirement needs. Taking stock, I decided to check how far away I was from my target:



From a first year figure of 1.2% of target to last year's 6.7% of target, there is indeed a long way more for me yet. Looks like I would either need to pump in substantially more capital or look for higher yield for a less capital-intensive approach...

Portfolio Review 4Q12

Currently holding on to 8 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6 and Portfolio Review 1Q11 for 7):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
8. Sembmarine
   • Buy
     High beta with decent yield amongst STI component stocks (cf. SIAS article)
     Record order book estimated at more than S$13b as of end December 2012
     Price driven down by recent bad news (i.e. Q3 profit decline on margin concerns and Jurong Shipyard accident)

Next portfolio review due after 31 March 2013.

Note to self: only simple P/L calculated


Positioning for 2013
It is commonly said that there are five main asset classes, with virtually every financial product being able to be classified into one of these classes or as a hybrid straddling across classes -

• Cash
• Equity
• Fixed income securities
• Real estate
• Precious metals

 We all know that portfolio diversification is key to managing volatility, and that it is advisable to rebalance one's portfolio through the different stages of life. At the moment, I have exposure to all of the above classes save for the last two: real estate (unless REITs can be considered) and precious metals.

My main gripe with precious metals is that they do not generate any cash flow. On the flip side, advocates of precious metals will say that they tend to be a good store of value, especially in times of uncertainty, and certainly there is a good deal of uncertainty in the world today from fiscal cliff concerns in the US, debt woes in the Eurozone and political instability in the MENA region caused by the Arab Spring.

Add on to my REITs / shares / bond funds / foreign currencies? ... Precious metals or not? Gold, silver or platinum? ETF or physical? ... Some questions for me to ponder over

Merry X'mas and Happy New Year to all! =)

REITs Screening Criteria III

It was with some interest that I read articles expressing Citigroup's and UOB KayHian's positive sentiments towards S-REITs.

In an earlier post, I had highlighted the following as my selection criteria:

Stability

1. Low gearing, i.e. < 35% (also the limit for REITs without a credit rating)
2. Presence of a sponsor, preferably a strong one, eg. Capitaland, F&N, etc
3. Portfolio mainly in Singapore, as I will have a local knowledge of the industry in that case

Value-for-money

1. Discount to NAV, i.e. paying less for more
2. High yield, preferably > 8% p.a.
3. Quarterly distributions (as opposed to semi-annually), this is just a personal preference to improve my own cash flow

With the run-up in prices recently, "discount to NAV" and "high yield" have become harder to find. To illustrate the point, here is a comparison of two snapshots in time of selected REITs according to the criteria above:

The difference couldn't be more stark in the yield column. From my own calculations, Sabana remains the only REIT with annual yield just slightly above 8% (note: not reflected in the list above due simply to the fact that Sabana's IPO was only in Nov 2010). And according to this blog, current yield levels for S-REITs range from the mid-4% to slightly above 8%.

My thoughts? Even for yield stocks, buy only when one is comfortable with the rate. For myself, I prefer to wait out with respect to S-REITs at this point in time and look for value elsewhere if it can be found.

Portfolio Review 3Q12

Currently holding on to 7 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6 and Portfolio Review 1Q11 for 7):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge

Next portfolio review due after 31 December 2012.

Note to self: only simple P/L calculated

Stock & Unit Trust Portfolio Update Jun 2012

Continuing on from Stock Portfolio Update Jan/Feb/Mar 2012,

• 27 Jun 2012
  Initiated Regular Savings Plan into UOBAM United Emerging Markets Bond Fund unit trust on dollarDEX platform

* note that dividends will no longer be reflected in this series of posts

Portfolio Review 2Q12

Currently holding on to 7 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6 and Portfolio Review 1Q11 for 7):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge

Next portfolio review due after 30 September 2012.

Note to self: only simple P/L calculated

Portfolio Review 1Q12

Currently holding on to 7 counters (see Portfolio Review 1Q10 for 1-3, Portfolio Review 2Q10 for 4, Portfolio Review 4Q10 for 5-6 and Portfolio Review 1Q11 for 7):

1. FrasersCT
2. PLife
3. Starhill
4. Cache
5. First REIT
6. Sabana
7. Cambridge
   

Next portfolio review due after 30 June 2012.

Note to self: only simple P/L calculated

Averaging down by selling

Lately, I have been reducing my stock holdings as the STI has been steadily climbing in March 2012 to hit around 3000 near the end of the month. In particular, I released those which I had bought at relatively high prices in the past. As a result, my average price for some of the counters which I am holding has become lower.

In the past, I have only ever considered the notion of averaging down by buying more shares of a particular counter. But averaging down by selling instead... as long as the market is heading up, why not? One, yield of personal portfolio should increase; two, paper gains can be locked in and realised.

Stock & Unit Trust Portfolio Update Jan/Feb/Mar 2012

Continuing on from Stock Portfolio Update Oct/Nov 2011,

• 6 Jan 2012
  Initiated Regular Savings Plan into Franklin Templeton IF Templeton Global Bond Fund A(mdis) SGD-H1 and First State Bridge unit trusts on dollarDEX platform
• 18 Jan 2012
  Received dividends (re-invested) from Templeton Global Bond Fund
  
• 29 Feb 2012
  Collected dividends from FCT, PLife, Starhill, Cache, First REIT, Sabana and Cambridge
• 14 Mar 2012
  Reduced Cambridge existing holdings
• 20 Mar 2012
  Reduced Sabana existing holdings