Gain some and Pain some – Eagle, Dairy Farm, Noble and Hyflux

With one and half trading days to go, and most people either in holiday mood or in “sian” mood (with the thoughts of going back to work), I think its time to wrap up my investment efforts for the year.

From the macro angle, 2019 has been a fine investment year for global markets in general.

The irony in all these is that the US and China stock markets are major winners this year. They made huge gains in the midst of their “trade-war”. S&P 500 gained 30% to reach new record level in the last few years. Shanghai CSi300 gained about the same % too. Major European markets and Japan Nikkei 225 are also no pushover, gaining ~ 20% and even the troubled Hong Kong gained 10%.

In contrast, the performance of our STI was a lackluster.

It managed to eke out a 6% gain, which was disappointing when compared to the rest. Having said that, our STI is technically dominated by the three local banks and Singtel – if they do well, STI do well. The share price of our banks did not make major headway this year and this explains the weak STI performance. However, our S-Reits did well, they gained about 20% on average. Electronics shares are also high performers.

So, this brings home the message that we should consider diversifying our investments across regions, across industries etc.

person holding blue ballpoint pen on white notebook
Photo by Lukas on Pexels.com

My portfolio outperformed the STI index but pale in comparison to the rest of the markets globally.

Though its performance is nothing to shout about, I am glad that it did well and managed to make progress. Thinking back to same time last year, the mood then was so down and pessimistic, if someone has told me that my portfolio can make 6% gain, I would have gladly taken it.

Reviewing the targets that I set for myself in 2019 the same time last year, I am glad that I managed to accomplish most of them, 

(1) I subscribed to Singapore Saving Bond (SSB) to the new max. Its interest rate may not be spectacular but it is “almost” risk-free and yet provides flexibility to its subscribers like no other tools in the market. Even at this current interest rate, I would still subscribe for SSB.

(2) I grew my index portfolio substantially again this year, tripling its values in two years.

(3) I maintained a 5% dividend yield from my equity portfolio.

Looking deeper,

I managed to reduce concentration risk of my equity portfolio. In particularly, I halved my exposure to Singtel, which used to be a double digit holding in my portfolio.

Furthermore, the top 10 holdings add up to 38% today instead of 45% as of 31 Dec last year and 52% the same day previous year.

The total value of US and Hong Kong stocks have also increased from 10% last year to 16% today.

Those are good stuff … there are also painful ones

One thing that I didn’t like was the fact that there is still too much churning in my holding. I think I traded too much. Looking at the Top 10, only 5 from the old Top 10 31 Dec last year remain, the rest are newcomers.

The main change was Eagle Hospitality Trust, which is now my #2 holding in the portfolio. On hindsight now, I may have been too hasty in trying to average down my purchase price, too complacent, acting without sufficient research and too greedy for the indicative yields. I really hope they will get their act together soon and please don’t not let it turns out to be one of those bad decisions I had made in the past when I chased for yields only.

Dairy Farm is another sad story, though not as bad as Eagle. I don’t think I need to elaborate further.

My story with Noble has finally come to an end. I was asked to do a few things in order to get a proportion of my remaining Noble shares but somehow I found the process so complex and labourious that I didn’t manage to complete it before the process closed. So, my entire investment in Noble is now gone, fully written off.

The other one is my Hyflux perpetual securities. So many sagas throughout the year but no real progress for small investors like me. I am not holding much hope that I will get anything back … in my heart (and mind), it is fully written off too.

Well, looking back to learn is good but we can’t turn back the clock. It is more important for us to look forward.

Time to think of my game plan for 2020 and what my investment targets are … I will share more with you when they are finally crystallized.

See you and have a great weekend.

With regards,

Warriortan

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