Portfolio @ July 2018

July

July is almost in the books, so it’s once again time for a portfolio review.

PortfolioPortfolio Value

Performance Indicators / Dividends

  • YTD Time weighted return: 3.24%
  • Dividends collected: $1,497.64
  • Upcoming Dividend Receipts:
    • Frasers Logistics & Industrial Trust: SGD 151.50
    • SingTel: SGD 652.70
    • Keppel Corp: SGD 195
    • Capitaland Mall Trust: SGD 106.78
    • AIMSAMP Capital REIT: SGD 150
    • Starhill Global REIT: SGD 163.50

Commentary

All dogs have their day

July has been kind to me, with portfolio value rising to an all time high of $129k. If you take into account dividends that has XD but are yet to be paid, that’s $130k there. This month’s performance was driven by pretty epic recoveries in my dogs SingTel and Starhill Global REIT and further augmented by gains in Capitaland Mall Trust, Alphabet, Visa and Bank of America. My investments in SingTel and Starhill still slightly remain underwater, but this recovery helped ease the mental torture. This episode has and continues to remind me that panic selling never made anyone money.

Recent Moves

I only made 2 moves this month, re-entering Frasers Property Ltd the day after the Government’s ruthless ABSD and TSDR adjustments and Facebook yesterday after “disastrous” quarterly reporting results. As mentioned previously, I tried for the Koufu IPO, but wasn’t allocated any.

With regards to Frasers Property, I felt the market did not fully understand their business model and geographic reach. Frasers Property has moved away from their property development roots into the recurring income property segments, with more than 80% of assets in these categories (Source: FY2017 Annual Report). What this means is greater earnings stability and less development activities, especially in the residential market – the area hardest hit by the Government’s property cooling measures. Add the fact that Singapore only accounts 33% of 2017 revenues (of which about half relates to residential developments), a juicy 5% dividend and 30% discount to book value, it seemed like a no-brainer. The market seems to agree with the subsequent steady recovery.

As for Facebook, its more of a vote of confidence in Mark Zuckerberg than anything else. Yes, Facebook platform growth is stagnating, but based on past experience, FB management always finds a way. With a giant economic moat and many monetization levers yet to be pulled, the decline seems overly done. Time will tell if my faith was misplaced.

Earnings review

Most of my portfolio stocks/REITs have reported quarterly earnings, so here’s some quick thoughts on them:

  1. AIMSAMP Capital REIT – Steady quarter, environment continues to be challenging,
  2. Capitaland Mall Trust – Pretty good quarter, 2.2% y-o-y DPU increase, 0.8% positive rental reversions, AEI at Westgate, Gearing drop to 31.5% – potential acquisitions incoming (hopefully), good stuff.
  3. Keppel Corp – Honestly a pretty meh quarter, special dividend is nice. In separate news, noted Keppel Urban Solutions and Keppel Capital signing some partnerships/MOUs with ST Engineering and MindChamps for smart cities and early childhood property assets respectively, which I found interesting.
  4. Starhill Global REIT – Stabilised DPU decline at 1.09 cents, Good to see office occupancy increasing to 95% from 90% in Q1, Uniqlo renovations at Plaza Arcade completing soon with opening expected in Q3, plenty to look forward to.
  5. Visa, Alphabet, Bank of America, Facebook – Simply put, decent to stellar quarters.

Here’s to an awesome August. 🙂

Happy Hunting,
KK

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Portfolio @ June 2018

June

Time flies, half of 2018 is over. As usual, its time for another portfolio update.

Current PortfolioPortfolio Value

Performance Indicators / Dividends

  • YTD Time weighted return: -2.20%
  • Dividends collected: $1,475.06
  • Upcoming Dividend Receipts:
    • Frasers Logistics & Industrial Trust: SGD 103.50
    • SingTel: SGD 652.70
    • Bank of America: USD 16.80
    • Visa: USD 11.76

Commentary

The battle between Bulls and Bears rage on

I was preparing my portfolio update with a slight tinge of fear as I felt June had not been great for me. To my pleasant surprise, my portfolio ended up approximately $200 month on month. Despite horrible losses in SingTel, Keppel Corp and Starhill Global REIT, it was made up for by gains in my tech stocks Amazon, Google and Spotify. This is illustrative of the fact that we always remember of our losers, not our winners, at least for me.

The current issues clouding the market include the global trade war (thanks Donald Trump), the flattening yield curve and to a temporary extent, the World Cup (don’t ask me why that is a thing). This resulted in a re-rating downwards of yield assets (creating the June Great Singapore Sale in REITs and dividend stocks) and a flight to US stocks with little Chinese exposure as seen by massive fund flows to the US and tech stocks.

Of the 3 issues, I personally fear the trade war the most and given the no-holds-barred way Donald Trump has been stirring the hornet’s nest, I decided to hold more cash now in anticipation for further downside in Singapore stocks. Chances to snag good dividend paying stocks and REITs on the cheap have emerged in June and if you are into income investing, this could be your chance to increase your portfolio yield.

June transactions

This has been a rather busy month on the transactions front due to the Great Singapore Stock Sale and my decision to hold more cash now.

  1. Sold Micron Technology for a small gain as my speculation thesis didn’t work out to the planned extent thanks to trade war fears.
  2. Sold half my Bank of America stake. Essentially, I took out most of my cost in Bank of America having returned 90+% since I bought the counter 2-3 years ago. Will leave the rest hanging in anticipation of further rate hikes.
  3. Sold Spotify and Amazon after the meteoric rise thanks to fund flows back to the US into these stocks. Too far, too fast for me and momentum was flagging for these 2 counters towards the end of the month. Given my need to raise cash, these were the ideal targets.
  4. Bought Frasers L&I trust as part of the preferential offering as mentioned previously and added more in the open market on slight weakness to round out my position to roughly $20k.
  5. Initiated a position in Yuexiu Transportation Infrastructure on weakness. Essentially, this is the toll road operator of the Guangdong government, with expressways pre-dominantly in the Pearl Delta region. Highly free cash flow generative (since its a toll road, literally), stable increasing dividend history and a proxy for China’s increasing logistics and domestic consumption. Key risks include government regulations and “Well, it’s China” risk.
  6. Added more Starhill Global REIT on weakness. Nothing much to say here, I just don’t think it is as bad as what the market is saying. With potential catalysts in 2H 2018 for it’s overseas properties and potential recovery in Singapore Grade A office rentals, I’m willing to add to my position at 7% yield.
  7. Initiated AIMS AMP Capital Industrial Trust. A steady Singapore industrial REIT that I’ve admired for some time. A REIT that did not tank despite the yield asset re-rating, goes to show investors’ confidence in the name. Yielding a trailing 7.4%, it felt like an appropriate time to initiate my position.

Second half of the year tends to be better in my short investment journey. Hopefully it plays out this year as well.

Happy Hunting,
KK

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Frasers L&I Trust preferential offering results

Greetings from Tianjin! I’ve been busy these 2 weeks as I’m currently on a work trip, so no regular content last weekend. Chilling in my hotel room at the moment so I decided to give a quick update on my portfolio.

Frasers Logistics & Industrial Trust

The Frasers Logistics and Industrial Trust PO results are in! As expected, I didn’t get all the excess rights I subscribed to:

  • Total units applied:
    • Entitlement: 1,500 units
    • Excess application: 6,100 units
  • Excess Units received: 1,500
  • Total units received: 3,000 units

Based on today’s closing price of $1.04 and rights issuance price of $0.967, that’s an automatic 7.5% gain. Sweet 🙂 The reason why I’m growing to love rights issues for REITs.

Yup that’s it for now. Stay tuned this weekend for a exclusive investment article about my time in Tianjin 😀

Happy Hunting,
KK

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Portfolio @ May 2018

May

Before I begin with my regular portfolio review, I would like to welcome the 7 email followers who subscribed after my last post on CPF Hacks. That single post garnered over 10k views, almost doubling the blog’s lifetime views over the course of a few days. Thank you for your support of this tiny blog and letting me know that I’m writing something worth reading.

Here’s my portfolio as the end of May 2018:

SG StocksUS Stocks

Portfolio Value

Committed cash relates to funds used for the Fraser’s L&I Trust PO

Performance Indicators / Dividends

  • YTD Time weighted return: 0.33%
  • Dividends collected: $917.76
  • Upcoming Dividend Receipts:
    • Frasers Logistics & Industrial Trust: SGD 645
    • SingTel: SGD 652.70
    • Bank of America: USD 16.80

Commentary

Sell in May and go away

This age old investor adage proved true this year. With increasing geopolitical risk thanks to the Trump circus and their crusade against world trade, and Italy’s government (or the lack of it) woes, we face another sad month in the markets with losses largely driven by declines in Keppel Corp and Singtel. That said, that didn’t stop me from making big moves this month. After all, stocks do get cheaper in a downturn. Will June be better? Or will the market decline during the World Cup (apparently that’s a thing)? We shall see.

Transactions for this month

This was another transaction heavy month as I continue my pivot towards income and bidding farewell to more US stocks.

Purchases:

  1. Bought 15,000 units of Frasers Logistics and Industrial Trust (SGX: BUOU) ahead of the preferential offering as mentioned previously. Subscribed my 1,500 unit entitlement and applied for excess 6,500 units. I personally don’t expect to get much excess units, if any, given the intense interest in the REIT. Going forward this REIT will be a substantial driver of my passive income.
  2. Bought 1,000 shares of SingTel (SGX: Z74) after yet more selling pressure from institutional investors after earnings. The earnings itself was ok in my opinion, given regional associate troubles. The commitment to maintain a 17.5 cent dividend for the next 2 years was welcome too. Where the bottom is, I do not know. All I know is I’m buying a best in class telco with a decent yield. Will look to add again if it reaches the $3.00 – $3.10 range.
  3. Bought 80 shares of Micron (NASDAQ: MU) as a small speculation. Analysts are signalling doom and gloom for NAND and DRAM prices, I’ll take the contrarian trade as I feel with demand for chips should still be strong. The company also upped guidance for the year and instituted a monster buyback.

Sell transactions:

  1. Sold Frasers Commercial Trust largely to fund my Fraser’s L&I purchase. Trading in a sub par commercial REIT for a better quality one makes sense to me. That said, those who have a greater patience than I can consider FCOT at its current price as it has crossed the 7% yield threshold recently.
  2. Sold Lockheed Martin and Raytheon largely due to poor price action. I remain bullish on the US weapons manufacturers as a whole, but short term this sector should be under pressure due to confusing guidance and trade war related issues. Divested also mainly to concentrate funds in more important positions.
  3. Sold Walt Disney. This one pains me, as I really love their Marvel and Star Wars films, but this has been a big time under performer for me and with the continued uncertainty over the Fox deal, I really don’t feel like waiting around for this stock. Should I have sold sooner? Probably. I kept this around largely for diversification and love of the company, but at the end of the day, stocks are just pieces of paper.

Here’s to a better June.

Happy Hunting,
KK

Information presented in this post is for general information and educational purposes only. It does not constitute a call to buy or sell any stocks. Do your own due diligence, invest carefully and wisely my friends.

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Portfolio @ April 2018

April

April PortfolioApril Portfolio Value

Performance Indicators / Dividends

  • YTD Time weighted return: 0.66%
  • Dividends collected: $388.69
  • Upcoming Dividend Receipts:
    • Frasers Commercial Trust: SGD 92.80
    • Capitaland Mall Trust: SGD 105.64
    • Starhill Global REIT: SGD 109
    • Keppel Corp: SGD 182
    • Raytheon Co.: USD 15.19
    • Activision Blizzard: USD 14.28

Commentary

After suffering a pretty horrendous March, the chase is on to recover all those paper losses. In that sense, it was a decent month with month-on-month gains of about $3k driven largely by gains in Amazon and Spotify, offset by losses in my defence stocks Lockheed Martin and Raytheon on strange earnings guidance, Macron’s efforts to retain the Iran Nuclear deal and yesterday’s North Korean denuclearisation declaration. To say I’ve been very lucky with geopolitical and random news these months has to be an understatement 🤣 All I can say is that fundamentals are strong and I’ll stay the course.

Portfolio changes made this month has been more for diversification purposes given the volatile environment. They are as follows:

  1. Divested some Keppel Corp and rotated the cash into Capitaland Mall Trust to keep for the long term.
  2. Partial divestment of Amazon and full divestment of Facebook into Spotify and Visa respectively.

I’ve mentioned previously that I would buy into Spotify at the right price and I was presented with an opportunity early in April and it has been a decent performer since my purchase. As for Visa, I’ve always wanted to be involved in the payments space and went for a household name to limit the volatility in my portfolio, compared to if I had gone for sexy names like Square or Paypal. As for CMT, it was trading at a decent price. Although it was not the best yield of 5+%, with future growth opportunities in the Funan redevelopment, organic dpu growth and capacity for acquisitions, I’ll hold this for at least the next 2 years.

Earnings season has started in April and companies have been reporting great earnings so far. Only the counters with known flaws (FCOT and Starhill) were slightly disappointing to me. Will continue to observe these 2 REITs and rotate into better quality REITs if the market presents a chance.

For now, I’m just going to save and build my warchest in preparation for more volatility.

Happy Hunting,
KK

Portfolio @ March 2018

March.jpg

March Portfolio

Performance Indicators / Dividends

  • YTD Time weighted Return: -2.26%
  • Dividends collected: $244.20
  • Upcoming Dividend Receipts:
    • Bank of America: USD16.80
    • Activision Blizzard: USD14.28
    • Keppel Corporation: $322

Commentary

March has been another volatile month in the markets. With trade war fears, Facebook’s woes and Trump’s war on Amazon, it was a pretty bad month for me. All in all, I’ve round tripped my 2018 gains and then some. That said I’m looking to build more income into my portfolio using my newfound knowledge from the Dividend Machines course, so I’m continuing to save and build up my cash reserves.

Transactions-wise, other than those previously disclosed, I’ve sold ATVI as it was not acting well and I wanted to move away from high multiple tech stocks. If the chip stocks continue to tank, I’ll be interested in shifting my money over from FANG stocks. I have my eye on Intel and Micron at the moment, just waiting to pull the trigger.

Here’s to a better April 🙂

Happy Hunting,
KK

Portfolio @ February 2018

February

 

It’s the end of a topsy turvy month so it’s time to take stock!

Portfolio 1Portfolio 2Portfolio 3

Performance Indicators / Dividends

  • YTD Time weighted Return: 3.03%
  • Dividends collected: $244.20
  • Upcoming Dividend Receipts:
    • Keppel Corporation: $322

Commentary

Market volatility brought about a correction in early February, prompting me to put more capital to work this month as seen in the graph. This is offset by the decrease in unrealised gains for the year as a result of the correction.

It’s been a month of significant transactions. Other than those previously disclosed, I built a stake in Frasers Commercial Trust as a contrarian investment. As the HP Inc overhang over the REIT is gradually lifted, with a potential catalyst of the office space rental recovery going into 2019, it looks like a decent speculation. It pays a decent yield as well at the moment, fitting into my shift towards an income strategy.

Here’s to a better March! Huat ah!

Happy Hunting
KK