2016 Investing Report Card

Year 2016 Closes, Results and Returns

2016 closes and with SGXcafe calculating returns on a daily basis, I knew what was coming before the year ended. Disappointingly, my portfolio underperformed STI ETF returns this year - the first time since 5 years of investment. With the negative losses last year, it was quite disappointing to have not grown my investment this year as well.

2016 Portfolio XIRR: -2.215%
STI ETF XIRR: 2.864%

Fun Facts

For now, let's lighten up the mood for some infographic about my portfolio movement this year:

Dividends Goals

With regards to $1000 the dividend goal I had set for 2016, you can see that I have narrowly missed it with $954.25. This partly due to Singpost's tightening dividend policy as well as Falcon Energy not yielding any dividend this year.

For 2017, I hope to increase my dividend received to the tune of $1100. Building up a portfolio that can gives me a steady income stream is one of my retirement goals for the long long term, and I hope that I am able to slowly accomplish this goal.

To increase the dividend, one way is to focus on purchasing stocks that are dividend-yielding and have the cash flow to support it. Monthly investment in STI ETF with my siblings will also contribute in a minor way, probably to cover the shortfalls from the dividend cut by Singpost.

Going Forward

Despite these two years of negative returns, I aim to keep the course. But it has certainly made me re-assess the way I look at gains. A problem is me not realizing profits only to watch it slip away and never coming back. One part of me always wants to be noble and be a "long-term investor". The other part is Graham's and Buffet's mantra of only buying companies where you will never give it up. Falcon Energy has been a bummer and I hope it proves itself in 2017.

For further pickings, I have a few stocks in my mind for research and considerations. Working gives me an steady income to invest but it takes time away from research and homework. But I hope to stay the course and just keep moving ---- towards financial freedom!

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. 

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