Wednesday, 7 September 2016

Portfolio Update - August 2016

*As of 7 September 2016

Counter Average Price Yield on cost(%) Weightage
UOB Bank
18.2150
4.00
18.39%
OCBC Bank
8.6000
4.00
17.37%
Starhub
3.4700
5.70
15.77%
First REIT
1.2500
6.75
5.68%
Keppel Corp
5.3700
5.00
8.13%
SPH
3.7500
5.00
5.68%
Capitaland Commercial
1.3523
6.15
3.41%
SPHREIT
0.9293
5.80
3.28%
Keppel DC REIT
1.0102
6.50
2.04%
Ascendas Hospitality
0.6991
8.03
1.76%
Mapletree Logistics
0.9800
7.40
1.48%
STI ETF
2.8058
3.50
17.00%
Total

4.78
100.00%

Legend
CDP
SCB

Total Invested Capital = $19,884.33

Total Expected Dividends/month = $78.90

Average Dividend Yield = 4.78%

Once again, the fears of a premature rate hike by the Fed caused markets to correct again, which kind of feels like totally cyclic as we have witness the same old tale repeating many times over. Recently, we heard of the surprising news of Swiber going bankrupt and the focus was on the bank loans exposed to particularly on the oil and gas sector. Heavy correction of the banks followed but I have been holding back on adding more on the banks given my already heavy exposure to them.

The month of August also meant the commencement of Standard Chartered Bank's new policy on the minimum commission levied on non-priority customers like myself. So August turned out to be a month of zero transactions. That's right, you heard me, big fat ZERO. This is surprising given my trigger happiness in trading when SCB still had no minimum commission. The new policy has now reduced my chances in being able to average down my costs. Furthermore, after doing my calculations, it was much more worth the money to use my regular brokerage account to add to positions since it almost costs the same, with the exception that I am able to put the shares into the CDP. The only limit is the maximum of 900 shares purchased to qualify for the $10 promotional brokerage. 900 shares even for low priced REITs is still too much for me to be considered a 'nibble' per se.



I have included an update of my portfolio up to today, 7 September, because I had been late in my updates. And also because I have recently made a transaction using my regular brokerage. I have purchased some shares of Starhub at a price of $3.47. Of course, now the price have fallen below after I caught a falling knife buying just after the bad news of the many competitors vying to be the next 4th telco. The good news is that I have now managed to diversify away from the banking sector by reducing its exposure substantially.



I had secretly hoped for the news of the possible rate hike to cause REITs to go into a discount like what happened earlier this year, but surprisingly they remained ever so resilient. It was as if telling me, "Nah, we don't believe they will hike the rates lah." The REITs stubbornly held their values except for the hospitality REITs which took some beating in response to the news of hundreds of Zika cases in Singapore. And so, I didn't purchase any REITs this time round, much to my disappointment. At least, I could classify Starhub as an income stock, although if it cannot sustain its dividend payout then it may cease to be a 'real' income stock. As of now, the weightage of stocks vs income stocks have become on par and I have achieved my immediate target for now. As the stocks segment would most likely get cheaper faster, my focus would have to be in increasing my exposure to income stocks as of now.

And so that is all for the month of August/a bit of September. As the immediate target of making stocks and income stocks weightage equal has been fulfilled, I may just be content of sitting around and doing nothing until something compelling rocks me off my seat. So don't be surprised of many months of inactivity.

Chaos.

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