Thursday, 5 January 2017

Portfolio Update - December 2016

*As of 31 December 2016

Counter
Average Price
Yield on cost(%)
Weightage
UOB Bank
17.8600
4.00
11.05%
OCBC Bank
8.6000
4.00
10.44%
Starhub
3.4700
5.70
9.47%
Singtel
3.6700
4.00
8.91%
First REIT
1.2525
6.75
6.84%
M1
2.3600
5.50
6.44%
SembCorp Industries
2.4500
3.00
5.95%
Capitaland Mall Trust
1.9050
5.80
5.20%
Fraser Logistics & Industrial Trust
0.9200
7.00
5.02%
CDL Hospitality Trust
1.3050
6.80
3.56%
Keppel Corp
5.3700
5.00
4.89%
SPH
3.7500
5.00
3.41%
Keppel DC REIT
1.0822
6.17
2.63%
Capitaland Commercial
1.3523
6.15
2.05%
SPHREIT
0.9293
5.80
1.97%
Ascendas Hospitality
0.6991
8.03
1.06%
Mapletree Logistics
0.9800
7.40
0.89%
STI ETF
2.8058
3.50
10.21%
Total
4.84
100.00%

Legend
CDP
SCB

Total Invested Capital = $32,964.37

Total Expected Dividends/month = $136.52

Average Dividend Yield = 4.97%

Equities for the month December continued their rally from the Trump election into the middle of the month. The rally ended with heavy profit taking, particularly in the banks which were thought to be the strongest beneficiaries from increase in interest rates and Trump policies.

The strengthening USD was a result of the Fed being expected to raise interest rates for the first time this year, which they did, but what was surprising was the conviction in increasing interest rates at a faster pace than the market was expecting. But with so much uncertainty surrounding Janet Yellen's position once Donald Trump takes the White House, her words may not carry much weight in the end.



In this month of expected interest rates, it was my favourite moment. That is because the shock from the expected higher interest rates has caused the price of interest rate sensitive stocks to correct much further. This includes REITs which I was closely monitoring, and eager to add more to my portfolio.

In December, I added 2 REITs, First REIT and CDL Hospitality Trust.

Around the middle of December, First REIT dropped to its lowest in the last 6 months. At $1.255, I picked up some units which was lower than the purchase prices by Ronnie, one of the directors of First REIT, which I felt was a vote of confidence in the REIT. I was considering averaging down my position in Capitamall Trust vs First REIT, but I chose the latter because of its exposure to the healthcare segment which was deemed more defensive than the retail sector.



I was ready to purchase more units in Capitamall Trust should prices correct to $1.855, which my order had been in queue for the past month but it eventually did not trigger, much to my dismay.

In addition, I decided to purchase CDL Hospitality Trust to increase my hospitality segment in my portfolio. I decided not to increase my position in the Ascendas Hospitality because I felt the price of the REIT was more expensive compared to CDL, even though Ascendas was offering higher yields. Finally, I decided to go with past management performance on this one.



This is a short post, and I will end it off here. It has been a very busy month even though December is always considered a lull period, but not for me. Many of the people I know have already collected their bonuses, which I suppose some would have used them to put it back into the market, probably partially the reason why the markets rallied like it did in December. However, it was not so great for me, because I did not receive any bonus this year ever since I made the career switch out of the oil and gas industry. So much of the funds used are mainly from the salary I saved from the past month.


At the time of writing, the prices of REITs has increased in value, along with a general increase in stock prices, which is probably due to the Capricorn effect, for those who believe in it. I am probably not going to do anything, now that prices has risen.

Stay safe and invest wisely!

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