After a hectic week of non-stop 5 consecutive nights of conference calls with my US and European colleagues, I finally found some respite now to contribute my thoughts to our blog. In between, 8 new readers have subscribed to our blog and I thank you for your support.
In the last one week, our STI index has recovered 2.5% quietly and steadily from the fallout of the property cooling measures shock last Friday. The major markets around the world have also rode through the initial salvo from the potential “trade war” and gained back some grounds. The star has to be Nsadaq which hit a new high yesterday.
It felt like it was a “sell on worries and buy on realities” sentiment. That reminds me of what my psychologist once coached me, things don’t normally turn out as bad as you worry and at the same time, they are often not as wonderful as you hope for. Its always somewhere in between … So, being able to manage our expectations is the key to living a happy life. We don’t have to beat ourselves up too much when so many things in life are not really within our control.
At this midpoint of the year, I went back to have a look at the investment targets that I set up at the start of this year. Honestly, I almost forgot about the details already. So its good to recap, they were:
- Income Portfolio = To achieve 5.00% dividend yields and <5.00% loss in capital value invested
- Index/Permanent Portfolio = To achieve 3.25% dividend yield and no loss in capital value
- Growth/Value Portfolio = To achieve 5% return in dividend + capital value gain
- Singapore Saving Bond = To reach 100% of the maximum investment allowed
Well, the mid year results look promising but not prefect … I am still on track to deliver (1), touch and go to meet (2) by end of the year, (3) will be tough to meet while (4) is done.
Ever since I set up my income portfolio, I have not sold any of the stocks in this portfolio. I am really happy with this outcome. Dividend yield wise, it is on track to deliver 5% based on my purchase price by end of the year. It did suffer some capital loss but fortunately, it wasn’t large, @ -1.2%.
I have been injecting capital into my index portfolio in the last few months, growing it from 6.7% to 10% of my total portfolio. I expect myself to continue this aggressive growth for this portfolio as I admit that I just can’t find enough time to meet the demand of doing in-depth research for individual stocks nowadays. Dividend Yield is 1.37% … So I think it will be a challenge to meet the target of 3.25% by end of the year. Well, let’s see how it goes.
This is my biggest and most diverse portfolio as it also includes my US and Hong Kong shares. Mid year dividend yield gain is 3.5% already. However, the gain is dragged down by capital loss to the tune of -6.5%. So, nett yield for this portfolio is -3.0% down versus +5.0% target. So, there is quite a bit of ground to catch up.
By the way, the capital loss here is 6x larger than my income portfolio for the same period … It clearly shows that this portfolio has a higher inherent risk.
Purchases of Singapore Saving Bond has reached the maximum allowable limit set by the government. The more attractive risk free interest rate of late has prompted me to accelerate this.
So, all in all, I think its a reasonable results for first half of the year.
I will not be making major adjustments as it seems that the plans are working out okay.
I do hope the market in the second half of this year will be more stable and less volatile.
I am definitely looking forward to collecting more dividends in the remaining months, started with SPH Reit earlier this week and with pace picking up by many other companies announcing their results (and dividend distribution) next week.
Have a great weekend