My Stock Holdings (March 2016)

After a long wait, I can finally sit down and count my gains for the month of March! With the Singapore stock market in the doldrums for the first two months, there were finally some rebound even though I did not enter anything prior to it. However, as I also did not let go of any stock, it meant my portfolio clawed back some gains.

This also highlighted how investing is actually advantageous to constant trading. According to this article, missing just the best ten days of S&P in the period between 1993-2013 will cost the investor a 3.8% drop in annualized returns. While many will argue that trading is better as one can let go of stocks at the highest and buyback at a lower point, I can assuredly say that I neither have the skills nor the time. Hence, as a student and eventually a working adult, passive investing will still be the way to go.

On the matter of dividends, I received a total of $227.42 for the month of March. This amount was disbursed from HPH Trust, SingPost and Karin Tech. Hence for the first three months, the total dividends received comes up to $261.57, a little over a quarter of my dividend goal this year.

Also, I had bought GLP on 31 Mar 2016 for a cost of $1.955. A little high, but through the average of valuation methods which I may subsequently write about,  the fair value price of GLP I came up with was actually $2.42. Coupled with GIC being the majority shareholder, I feel that there is some merit to the purchase of GLP. With the addition of GLP, the breakdown of my portfolio is shown below. Let's hope 2016 is a good year for all in the stock market =)

My Stock Holdings (February 2016)

Whew, busy month with Design Project, FYP Presentation, projects, tutorials, midterms. For record sake's, I have come online to record this short entry of my stock holdings in February. Whilst the market condition is still bad, there is a restoration of stability and hence marginal growth.

In the month of February, Keppel Reit has declared a dividend of $0.0168 per share. I chose to reinvest this dividend through the DRP. While filling up the form, I realised that I can allocate the shares I own to either 1) Receive the cash dividend OR 2) Receive new shares. Knowing this, I can allocate some of my share to receive cash dividend while still receiving the same number of new shares. This is possible because there can be no shares lower than 1 and is thus rounded down. Might as well use this spare shares to receive the cash dividend! The amount is not huge, but I hate to give away free money.

Therefore, the first dividend I received this year will be $34.15. The start to my $1000 dividend aim for this year. Below is my stock holdings at the end of February. Noticeably, HPH Trust has fallen in overall value to stand below Keppel Reit.

PS: I finally found a job!

My Stock Holdings (January 2016)

Below is my portfolio distribution for the first month of 2016. Here's to a better investing future for the rest of the year! 

From the start of this year till end of January, the main movement was me selling Bank of Ireland in favor of Karin Tech. The sale of Bank of Ireland was triggered by the disappointing lack of positive push to the stock. Though the economy for Ireland and Europe had been improving for a while now, with stable dividend on the way, it had not translated into positive movement for the stock. The premise of me buying Bank of Ireland back in 2014 was based on the improving economy in Ireland as well as the improving of the bank's balance sheet. Both events happened without any significant price increase. Hence by referring to my buying motivation, I had realised holding the stock by this point, meaningless. This also serves as a good lesson for readers out there that when buying stocks, remember to write down your reasons for writing it. Periodically review it to see that the reasons are still valid and if the reasons are not valid anymore, consider selling it. 

Following the previous post about Karin Tech, I have decided to add the stock into my portfolio for the strength of management, resilient earning power, advantageous foreign exchange and good dividend. However, from the announcement from the company on Wednesday, I might have misjudged the strength of the business itself. Profits from Karin Tech plunged approximately 80% due to softening consumer electronics product. I had reservations about that section of business due to the low economic moat, but I did not expect it to drop so much. Nevertheless, a dividend of 0.05 HKD translate to a half year dividend yield of 3%. This is sufficient for me to consider holding it for longer periods of time. A warning to any investors though, the stock had fallen below the 3-year low of $0.285. Hence, a short term investor may have problem holding it. 

HPH Trust has also announced their results recently with a drop of dividend. A constant worry of mine is the huge debt of HPH Trust. Though HPH Trust has good dividends in the past years, the stock price drops along with the dividend and I wonder if the dividends/business is sustainable in the long year. I will be reviewing this stock with more spare time. 

SingPost announced marginal growth in profit despite higher revenue. It is really frustrating that profit does not grow proportionally with revenue. Logistics can be a lower margin business. However, having waited over 2 years for profit catch up, it does not appear to be happening. Management guided that "transformation" is finalizing and it is time to reap its fruits of labor. With the departure of Wolfgang Baier, I really wonder how the company is going to fare in the future. If not for my wonderful entry price, I may have sold this stock already. Perhaps I sound salty, but the downgrade from OCBC is infuriating. Within a quarter, the bank has conveniently slashed $0.82 off the target price of SingPost. While details has been lacking for the justification of the new TP, I find it unbelievable that the cut is so much within a quarter. Makes me wonder do the research house just see.... "heyyyy, the current trades so far from our TP. I think it's time to cut it nearer to current price to stay relevant." Also, I don't see eye to eye with people stating that dividend has increased from 1.25 cents to 1.5 cents. This is because it had been declared by SingPost since 1 year ago and should have been factored into stock price long ago. Don't mislead potential investors.

-End of whinings-

With the removal of Bank of Ireland, my portfolio has transformed into a full dividend machine and I hope I can meet my dividend target this year. The Year of Monkey should be good to people born in the Year of Goat and I hope it is true! So Happy Chinese New Year all! Have a prosperous year ahead!!

2015 Investing Report Card

In my previous post, I mentioned that my "financial year" ends on 13 January 2016, since it was the date I started tracking 2015 investment returns. Now that the day had past and I finally handed in my Final Year Project report, I can finally sit down to type out this post!

2015 Annual Return: -10.412% (for year ended 13 Jan 2016, using Excel's XIRR function)

With a portfolio that is down more than 10%, it was definitely not a good year for me. The consolation is that using the same calculation metric, the 2015 return for STI ETF was actually -16.099%. 

Hence comparing my portfolio against the STI index, I had technically "beat the market" for the year of 2015. Since many books had mentioned professional fund managers have trouble beating the market, I take pride that I had achieved the feat in 2015. It was a tough year especially with China's economy not doing well and oil price being so depressed. As a graduating student, I can sense that Singapore's economy is not doing well at all. This is so because of the tight job market available for me. My wish for 2016 is for me to get a job and start my own monthly investment plan, putting a part of my salary in STI ETF. I do not mind that the stock market tanks because over the long term, buying in a bear market inflates your returns. Buy when others are fearful!!

Note: Recently, someone introduced me to Holding Period Return as a way to calculate portfolio return, instead of XIRR. I am still not sure which is more accurate. Hence for 2016, I will keep track of my investments using both methods and observe how far they deviate from each other.


Here are some of the fun facts about my portfolio performance in 2015:

• Dividends are probably the reason why my portfolio managed to outperform STI ETF - receiving $863.19. 

• Dividend yield for portfolio is 4.80%, Excluding stocks that did not give dividend, the yield goes up to 6.17%.

• I'm not a perfect investor. I trade sometimes (or technically, gamble). With 5 sets of Buy-Sell trades, I made a loss of $438.45. Portfolio return would have been better if my hand had not got itchy.

• Narrowly missed losing a whole lot more if I did not sell Ezra in time. Ezra closed at $0.0900 that same day.
  

• 2015 was also a bad year because none of the stocks I bought for investment purposes finished the green. Stocks included K-Reit, k1 Ventures and Straco. The only positive investment which I sold off was Apple Inc, which I bought in 2014 and sold in March 2015. 

2015 was an overall bad year while 2016 remains uncertain and volatile. Within the first 2 weeks, STI had already dropped 8.46% and the future of oil rigs giants KepCorp and SembCorp look threatened. Having started investing in 2011, I have not met any bear market or recession. No one can claim to be "experienced" if he/she have not gone through a financial crisis. Hence I am actually excited for 2016! Bull or bear, I will still be in the market, seeking my private returns. 

My Stock Holdings (December) & Happy New Year 2016!

2015 stock market closed without a bang, neither a plunge. But it's undoubtedly a bad fairly lousy year. Starting the year at 3370.59 and ending it at 2893.19, STI dropped 14.16% excluding dividends. Oil price had bottomed to a 11-year low and does not seem to be recovering any time soon. Relevant companies in the oil industries had taken a hit, in particular Keppel Corp and SembCorp.

In my own portfolio, SingPost dropped almost 8% partly because of its CEO's departure and corporate governance problems. In my previous posts on SingPost, I mentioned how much I admired Wolfgang Baier's leadership in transforming SingPost. Now that he is actually gone, a closer watch on SingPost's performance in e-Commerce will be warranted.

Consistently under-performing stocks in my portfolio will also be reviewed soon. (once I submit my FYP report) These stocks actually include Bank of Ireland (BKIR) and HPH Trust. Since buying them almost 2 years back, they had returned almost zero returns. In fact, accounting for inflation and further brokerage fees and foreign custody fees, they were probably negative returns. In the long term, I am pessimistic about HPH Trust since there is little impetus for the share price. Management guidance of allowing dividend payout to follow cash flow should further compress dividend yield. For Bank of Ireland, there should be a slow recovery of its business towards declaring dividend late 2016 or early 2017. However, holding BKIR incurs foreign custody fee at POEMS and it is very vexing. Given the time, I would love to assess whether switching out BKIR and HPH Trust are preferable. (using capital budgeting concepts I learnt in FIN2004X!)

Rounding the "My Stock Holdings" posts for the year, below is the distribution of my portfolio at the end of December.

I received $150 from k1 Ventures through its capital reduction exercise. Adding it all up for the year, I had received $863.19 in 2015!

Since I will be working in mid-2016, I shall aim to achieve $1000 worth of dividend in 2016! This means putting some portion of salary into the stock market, maybe through dollar-cost averaging of STI ETF! Lastly, I shall write another post regarding my investing performance for 2015 as I started my records on 13 January of last year. Included will be breakdown of my Buys and Sells etc. Since I have not sat down to look at my records, writing that post is equally exciting for me!

Once again, Happy New Year and here's wishing everyone out there a prosperous and joyous year ahead! HUAT AH!

My Stock Holdings (November)

November brought down prices of a lot of my stocks, most notably Singapore Post and ST Engineering. I would probably not average down any time soon unless capitulation takes place. At the meantime, their dividends will keep me satisfied. 

I had also bought k1 Ventures at a price of $0.20 on 10 November. This was prior to the capital reduction exercise conducted by the company, in which it gave out $0.015/share to shareholders. k1 Ventures is a investment company and has a great track record of delivering returns to shareholders. It is a bit of a pity that I had noticed this company so late. Between 30 October 2013 to 29 January of this year, the company had return $0.11 of dividends. That's 50% of the price I paid, excluding any capital gains! A risk involved in buying the stock at such a late stage is that most of the monies made from divestment gains had already been given out, hence returns may not be as great as before. Future investments made by k1 Ventures may not be as successful but given the track record, I am willing to place a small amount of money with them in hope of reaping a good returns. However, writing on hindsight with the price standing at $0.183 now, it is unnerving that the stock seem to drop with everything I might touch. The opposite of Midas Touch, perhaps the market is currently not optimal for new investments despite good fundamentals. 

The pie chart shows the current distribution in my portfolio. In the month of November, I received dividends from Keppel Reit and Singpost. Hence the dividends I had received from start of the year to date is $713.19. 

My Stock Holdings (October)

Student life is killing me. At my last year of study, who knew things would be so tough. Final Year Projects, meetings upon meetings. Presentations and presentations. Deadlines and more deadlines. Nevertheless for my own sake and maybe to some extent yours, here's my holdings in October 2015.

No change in holdings but it seems that the market is doing well for the last month.

There are no dividends issued for the month of October, therefore it stands at $616.49. 

A number of investment activities in the upcoming month:
Number one is to ballot for some IPO shares of Jumbo. A review of the IPO can be found in Mr IPO's website. I almost always ballot for IPO to sell on the first day unless its a very compelling business. Jumbo does not look to be the exception but I think Jumbo can open at least above $0.30. With only 2 million shares for public subscription, hope is not high to get the shares.

Number two is to indicate to opt for Keppel Reit's dividend in form of shares. I will explain this scheme/decision in the next post, hopefully before the next monthly report.

My Stock Holdings (September)

Have been busy with school work this month due to Final Year Project and job-finding (holy shit!) hence not much time to update. 

I did buy Keppel Reit at $0.945 on 2 September as part of my income stocks. Also, dividends received in the month of September include $50 from ST Engineering and $86.05 from HPH Trust. 

Dividends Year-to-Date: $616.49

My Stock Holdings (August)

Portfolio at the end of August:

Note that it's a JPEG because I gave up using Google Sheets. Google keep republishing my charts although I unchecked that option. That is also why I deleted all my previous charts as it was overwritten.

So this month was quite a ride and my portfolio lost a value of $1000. Nothing to sweat about as I'm going for the long-term and not short term volatility. Looking forward, I really hope to buy in ST Engineering on the cheap especially since it had formed a bottom. Straco is really good for averaging down since I have only a small stake in it.

I'm also looking at Reits, in particular K-Reits and possibly Soilbuild Reits. We will see what Singapore market can offer.


In the dividend department, I received an additional $67.50 from Singapore Post.

Dividends Year-to-Date: $480.44

My Stock Holdings (July)

Bought Straco at $0.935 as the buy and sell price ($1) was at a huge difference. I had already known the good fundamentals that Straco possessed hence I casually queued at the buy price. Take a look at the EPS growth of Straco over the years since IPO. The CAGR of its EPS is calculated to be 33.08%.

Input that CAGR into the Future Value Calculator together with present value of 4.45cents (current full year EPS), you get an EPS value of $0.1857 in 5 years.

With a low P/E of 8, the stock price can be valued at $1.485 in 5 years. At historical P/E of 21.68 ( from POEMS Stocks Analytics), the stock price can be as high as $4.025.

The exact calculation method can be found here in my blog.


Overall portfolio for July is as follows:

Investing Report Card

Amidst the lab reports, presentation, projects and upcoming exams, this post was done up in light of my third year anniversary in investing.

My first transaction was done back in 8 November 2011 with the purchase of STI ETF. Throughout these 3 years, I had recorded and subsequently archived all my stock holdings with no way of finding out how well I fared against the market index. However, I recently discovered that I could track the CAGR of my portfolio using the XIRR function within Microsoft Excel and thus started to input my transaction history in the spreadsheet.

XIRR function works by inputting two sets of data, transaction value and date (this is reflected by column A and column B as shown in the picture). There are also a couple of rules to follow in order for the function to work. 

1. Beginning value of portfolio must be positive
2. Any "deposit" into the portfolio must be keyed in as a positive value
3. Conversely, any withdrawals (sale of stocks/dividends) is a negative value
4. When you finally want to compute the CAGR, input the ending balance as a negative 
5. Note that the date of transactions need not be in order (but must correspond to transaction!)

Using this method and inputting three years' worth of transaction, my portfolio's CAGR for the three year period turned out to be 9.25%!

This figure is definitely an A+++++ grade for me.  If this CAGR is sustained for 10 years, $10000 at the start will have turned into $24782 at the end of 10 years. However, given that there was a fantastic bull run these past three years, I am not optimistic that this growth will be sustained. Let's wait and see!

In the mean time, here are some interesting facts of my 3 years investing journey

1. My largest gain (unrealised) is currently Singpost, having bought it at $0.98. It is currently at $1.935 now. Including dividends over the years, Singpost is one of my two multi-bagger stocks
2. My second multi-bagger was Straco. I first bought it at $0.335 and watched it climb to $0.70 range. In the middle, I also received a special dividend of $0.020 per share.
3. My worst investment was definitely Vard. I first bought it at $1.37 and subsequently average at $1.28 and $1.08. All these was in hope that the takeover by the Italians would not succeed and stock price will run thereafter. I was only half right. The takeover did not succeed but the stock price did not run. Haha... Sold it some time after Vard declared that it is caught in a tax charge from Brazilian government (whew, missed a bigger fall when it declared profit guidance)
4. Had good profits in the US market. Bought and sold Bank of America for a good profit before. Currently have Apple Inc in my portfolio which I bought in at $88.58
5. On track to receiving $1000 dividends this year based on average capital size of $28500. This translates to 3.5% yield.

This is the end for my 3-years-investing report card. Hope you have gained some insight (however little) from this post. Pardon if there are many grammar errors or what not within this post as I am blogging this in the middle of my mugging session! Hope my finals will do as well as my investing :/ 

 

Signing off,
SG Youth Investor

Dividends: A Passive Income

Dividends are payment made by a company to its shareholders, usually out of its profits. Dividend policy varies from company to company. For example, some company do not pay dividends regularly. Others, like Singpost, pays dividends every quarter. Hutchison Port Trust pays bi-annually and Straco pays yearly.

People view dividends as an added bonus when they trade stocks. For an investor, dividends may be the make-or-break decision for buying the stock. This is because in the long run, dividends eventually becomes your passive income. One good example is Dividend Warrior, who regularly blogs about his dividend returns and income. In the latest 13 August 2014 post, he had accumulated $10,262 of dividends. These dividends are based on a capital of $222,560. That is my idol right there!

Usually when I tries to preach about the importance of investing for passive income, the usual response is that the capital is too low to start. However, I beg to differ. Everyone must start at some point and when better to start than now? For young investors, the most precious asset you own is TIME! Given that your capital returns an interest of 5% per annum and that you reinvest your interests, $1000 will become $2000 in 14.4 years. Make your money work as early as possible! In addition, SGX will cut lot size from 1000 shares to 100 shares by 19 January 2015. Currently, you can only buy stocks in blocks of 1000 shares, or 1 lot. By next year, you can purchase stocks in blocks of 100 shares. This means that blue chips like DBS or Keppel Corp will be more affordable to the public.

The gains to be made from investments are from either capital gains from rising share price or dividends. Although capital gains are usually gained in a shorter period of time and thus more satisfying, a smart investor will realise that dividends pay well in the long term. Everyone looks forward to retirement eventually and living expenses after retirement generally comes from CPF. But what if you manage to build a sizeable portfolio by the time you retire? Instead of putting your cash into a saving accounts which yields less than 1%, put it into dividend-yielding stocks like REITs and Trusts. These two types of stocks usually yield at least 5% dividend a year. In addition to CPF withdrawal, dividend payment can really add to the comfort of your retirement. For me, investment is really about building a portfolio that can eventually provide enough dividends for financial freedom/retirement. That should also be the objective that other have for investing.

As a result of my love for dividends, I had been slowly buying dividend stocks like Trusts and REITs the past 2 years. Below is my humble dividend records in the last two years of investing:

Do note that Dividend Yield reflects average yield of only dividend-bearing stocks while Portfolio Dividend Yield is the dividend yield based my enlarged portfolio capital.

I've highlighted the benefits of dividends in investing and also briefly covered how time is our most precious asset. Also, I've mentioned about two categories of stocks, REITs and Trusts, which bears comparatively higher dividend yield. Hopefully after this post, you might give investing a good thinking over and start your own investing journey!