I am feeling cash poor this year

I remembered when it was this time last year, I was feeling very good. Besides the fact that I got my bonus, my investment portfolio was showing a good gain then.

But this year … (sign) … the value of my portfolio literally tanked by 15%.

Was it expected? On reflection, yes, when I looked back at the first blog I published early this year.

In that blog, I forecasted that the market would drop by 10-20% in 2018 and sadly it did. Forecasting is one thing but actually receiving the reality is another.

It still feels very painful to see the value of my investments deteriorating day by day. Well, I am trying to follow the established wisdom in this kind of downturn … i.e. “Don’t Panic and Stay the Course”. I hope things will turn around in 2019 … I have given up on 2018 already.

Anyway, back to my year end bonus …. again like last year, I spent it all even before the month is over 🙂

If you are wondering how, let me share ….

  1. I spent quite a fair bit of the bonus in 2 short overseas vacations with family
  2. I topped up my SRS to the maximum contribution
  3. I contributed to my parents’ retirement accounts

For what still remained, I decided to buy small amount of ETFs that tracked STI, HK HSI and S&P500 index … hoping to average down my cost price.

This year I skipped the top up to my children’s Special Account and did not do any refund to CPF Property Loan.

One reason is that I am feeling cash poor and rather depressed this year.

I also feel that the equity offers better value. Furthermore, interest rate is also going up and the 2.5% and 4% from CPF and the locked-in nature of CPF make it less attractive now.

I hope the market will brighten up in the coming weeks and months.

If I don’t write a new blog, Merry Christmas everyone. Take care and have fun.

Regards,

Warriortan

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6 thoughts on “I am feeling cash poor this year

  1. Hmm were you not invested during GFC or dotcom bust? Gotta be prepared for the stocks portion of your portfolio to drop 40%-50% during recession (we’re not even near one yet). In fact SG & HK stocks can drop -60% becoz our companies are so trade dependent and our economies so open. If a -15% drop affects you so much, maybe it’s a sign you have too much percentage of your portfolio in stocks. Now you know why those old men keep talking about asset allocation & 60:40 portfolios. Stay safe and sane.

    Liked by 1 person

    1. Yes, you are right, in fact my bond portfolio is doing relatively well. I am not 60/40 yet, but more 25/50/25 bond/equity/Reits. In the year, I plan to bump up my bond purchases (taking adv of the new limits for SSB) at expenses of equities. Hoping to get something like 30/40/30 at end of 2019 🙂

      Like

    1. Well, I did in the first month, taking profit and reduce my portfolio size by 10% at end of Jan. However, the market also corrected and I thought it has reached a point to buy back. I also tried not to be too much of a trader hence, I tend to hold and accumulate. Last but not least, its a forecast …. I was hoping it won’t happen … LOL

      Like

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