Mar 2019 Portfolio Update

March 2019

Portfolio Value after market close: S$106,881.07
Wifey's Portfolio Value after market close: S$44,333.53

Comment:

1) Realised a 4.94% gain on M1 after accepting Konnectivity's offer. Not bad for a 3 years holding considering the prior circumstances.

2) Contemplating whether to take profit on my reits especially for CCT which is at 40+% gain now.

SSB vs SIA Retail Bond

The pros and cons of the SIA retail bond have been written extensively by many bloggers so I will not be doing that with this post.

Instead I would like to just pen my short thoughts on it.

However before that, following are the yields of the Singapore Savings Bond (SSB) since beginning of last year. Interestingly I was browsing them before I decided to write this post.

Yields of the SSB have been falling since last December. And with the Federal Reserve not expecting further rate hikes this year, I suspect the SSB yield will remain flat for the next few months at least. 

Having said that, if we take the annualised yield of 2.16% based on next month's SSB and compare it against the 3.03% offered by the SIA retail bond, the difference is a 'mere' 0.87%.

I would choose the 'risk-free' SSB over the SIA retail bond anytime.

Firstly it is easier to redeem - pressing of atm and forking out $2.

Secondly it's flexible. 

Thirdly it makes no sense for me to take on more risk for the 0.87% premium.

Stock Screening Results - Mar 2019

With the recent cash from the sale of my M1 shares, I have to look for other dividend-paying stocks as replacement(s) to at least maintain and hopefully increase my portfolio yield.

So I turned to my best friend for help. Stock screeners.

Usually I used the StockFacts screener from SGX. However for this time I also tried Yahoo Finance screener for curiosity sake.

The criteria I set for the screen are as follows:

P/E Ratio: < 20

One of the most fundamental of valuation screeners. It is more meaningful if the PER is compared among companies in the same industry.

However in this case I usually set it to 20 as a rudimentary guard against overpaying.

Net Profit Margin: At least 10%

10% is the minimum margin in my opinion, for a company's sustainability.

Debt to Equity Ratio: < 50%

Obviously gearing is one of the most important metrics in terms of risk management. 50% is the most I can accept unless there are very good reasons for the high gearing.

Price to Book Value: < 1

I do not like to overpay for a stock. However having said that I have done it on a number of occasions usually due to a combination of other factors which paint an overall rosy picture of the stock. 

Dividend Yield: At least 5%

Ideally 5% is the minimum for my dividend stocks which is not too high honestly.

As you can see, the criteria I used are geared towards screening of income stocks suitable for my income portfolio. Not so much on growth or other value stocks.

Interestingly the result from Yahoo Finance screener is almost identical to that of SGX StockFacts screener except that the former includes one more counter in the screening result - Metro Holdings Ltd.

Here are the results.

                                                                         

Another interesting observation is that my previous screenings say 1 - 2 years back, almost always yield a 2 page long results.

However this time only 9 counters appear from the StockFacts screening.

Is the market worse or better than before? Or are most stocks overpriced now?

I think apart from the surface results from the screening, we can also delve deeper and we will be able to get a feel on the current market conditions.

Back to the screening results, I will do more due diligence into 1) Frasers Commercial Trust and 2) Sasseur REIT.

Goodbye to M1

I knew my relationship as an investor with M1 has came to an end when I saw a huge jump in my bank account yesterday.

True enough, it is the sum from my acceptance of Konnectivity's offer.

In all I made a small net profit of 4.9%. Good enough for me considering I was staring at huge paper loss at some point in time.

On the bright side I'm still walking on the sunshine with M1 for my mobile and broadband.

All the best to M1 for their new ventures which I had and still have high hopes for.

Next step for me is to redeploy the sum of money to another yield-accretive counter.

SGX Securities Borrowing and Lending Programme

It seems like a long time since I signed up for SGX securities borrowing and lending programme (SBL).

In fact I have forgotten about this until today when I realised $4.94 was credited to my bank account.

Upon checking my CDP statement, I found out that 11,000 of my M1 shares were borrowed (on loan) for 2 days last month.

In the probably 2 years since I signed up, this is the first time my shares got borrowed.. Haha

And of all shares, M1? This is some logic that I don't understand. Perhaps this is why I remained as an average retail investor.

As I can't find any formula online on the expected returns for borrowed securities, I decided to do a back-of-the-envelope calculation myself.

Calculations

No. of Shares On Loan: 11,000

Closing Price of Share While On Loan: $2.05 & $2.06

No. of Days On Loan: 2

Returns: 4% (this information is available online)

11,000 shares x $2.05 × 4% / 365 days x 2 days = $4.94

Please feel free to correct me if this formula is incorrect.

It's nice to have some additional lunch money sometimes.

Till next time.

Feb 2019 Portfolio Update

February 2019

Portfolio Value after market close: S$123,077.32

Purchases: Japfa @ 10,000 shares

Sold: None

Comment:

If price is right this will be a contra trade. If not I intend to pick it up for the potential capital gain.

Japfa just released a good set of results for FY18. It's impressive I must say though the gearing remains high.

Dividends:

RHT @ $7,520 (Special dividend)
MNACT @ $77.08
CCT @ $176.80
Suntec @ $103.60
ESR @ $67.28

Also subscribed to DRP for my Mapletree Logistics Trust dividend.