Jul 25, 2013

Cory Diary : Fears in the Market - Part 1

Sentiment of the market often drives the bust and boom of stocks. Often on hindsights that someone will say if I have done so and so, control my emotion, i would have strike rich !

So what's the fear in the market that has driven things to "recent lows" ?
At time of writing, here's the low.

1. Gold - US$1322
2. Suntec Reit - S$1.60
3. Wilmar - S$3.15
4. SIA - S$10.29
5. Smrt - S$1.445
6. Vard - S$0.80
7. Noble - S$0.90
8. NOL - S$1.05

Anyone dare to bottom fish ? I will be very cautious. Do it at your OWN Risk !
And no whining later please.

25th July 2013

Jul 24, 2013

Cory Diary : Dividend Play

I have been struggling recently on my investment portfolio even though this half year i have relatively good returns. In a recent survey, Singaporeans are found to be more negative than most other nations and this is despite our wealth. So don't fault me ! I am Singaporean after all. :)

With rising rate assumption, theoretically we should see lower yield with increasing leverage. Clearly the tide is working against dividend play. If we are thinking about bond in such scenario, the timing cannot be worst.
And Index ETF is near high.What if identifying growth stock or trading is not our cup of tea. Property yields are not much attractive either and pose to go lower with rising cost. Investor hands are limited with rising inflation.

If we are to look at high dividend counter from Reits which give 6-8% yield, a year wait at the sideline will mean opportunity cost (less Bank fixed Deposit ~0.5-1.0%) around 5-7%. If we think the stock price will not reduce by this amount assuming rate does rise, it maybe worth to invest. In the event rate does not rise or not impact as much, we may have additional buffer to build on year after year. This cumulative buffer increase on longer term will work in our favor even if we encounter crisis in later years assuming the reits are properly managed.

Another area to look at maybe Preference shares. They do come with some risk especially non-cumulative version. I will likely limit myself to Bank PS which give 4-5% if we do not mind the 6-7% premium ! Will this be the final few window of opportunities for me or should I park my fund in Government Bond and wait it out for the next crash which may take a long while to happen ?

24th July'13

Jul 14, 2013

Call me Pessimistic

So far for the first half year has been fruitful for me. SG Stock Investment XIRR YTD = 11.x%. Coincidentally is also the average score for the past 7-10 years of SG stock investment performance. The score includes fixed returns.

Many people will be happy but not me. Why ?

If you are to see below chart, only 39% has been invested. Which mean Networth XIRR will be lower. Further reduce if i included pensions into the count. To me that's quite a significant loss of INCOME if we are financially awake !

While I need to continuously look for way to fix that, i need to be mindful that due diligence is done to make sure there is Quality. For the past few months i have difficulty raising the threshold due to market dynamics. Obviously the best time to do this will be to wait for Regional/Global Financial Crisis like situations some may says. Well is easier to say than done.

I like to also add caution above that. If the wait is 5 years, that's roughly 25% lost returns assuming 5% average return uncompounded.

Also the 2008 GFC Crisis maybe once in a lifetime event to reach 50% and that's provided you catch the bottom and sold on the top which are highly unlikely to happen.

Another possibility is to have another side stream income. I will not close on that possibility completely but it won't be done in a big way.

Sick for the past 2 days while on holiday back here. Is a long time since i had one.
Many thanks to God for my health ! Nothing is more important than that. By the way is also time i start to do some serious spending. Cheers !

14th July 2013

Jul 13, 2013

Life Insurance Projected Yield

I admit am a whore to XIRR when comes to annualize returns in my investment. Can i do so for my Life Insurance Plan ? I know i know .. Insurance is for Insurance. But then no harm in trying to figure out how they compute their yield, right ?

That's a delta of -2.03%. So the devil is in the detail. Next time when you receive the Projected Yield Statement. Think again what it actually means.

13th July'13