Q32017 Update
Another quarter has gone by and the year is almost over!
Stocks
My stocks portfolio saw a few additions this quarter.
Netlink Trust:
I balloted for some units in Netlink Trust and got 1000 units at 81cents a piece (my thoughts on it are here). Currently waiting for it to bear some dividend returns and hopefully the share price stays above the IPO range.
MM2:
After having taken a look at MM2's business (see here), I saw that the owners of UnUsUaL had bought into MM2 at a price of 50c. I had read in other blogs about how it is good to accumulate when insiders are doing so, and decided I wanted to try this strategy out as well. This small investment constitutes my only speculative amount in my portfolio, in line with my plan to have 5% of my portfolio as speculative
After failing to buy GV, they are now trying to buy Cathay cineplexes. The market did not react well to this. There was an immediate slight drop in share price, which has since stabilised. I figure that if their next strategy is to buy a cinema, it makes sense that after GV they move on to buying Cathay. It would be lacking conviction if they gave up the cinema plan so quickly. I hope that after this purchase is over, the management starts to move towards more content creation and modern media distribution channels.
Concerns:
They only have $130m in cash holdings, most from financing. Operating cash flow is also negative. I will be curious to see how they finance the $230m Cathay acquisition and hopefully they don't stretch too far.
CCT:
CCT held a $700m rights issue for their purchase of Asia Square tower 2, at 166 rights per 1000 units, for S$1.363 per unit. I managed to get 832 units in this rights issue. The odd lots resulted from me not bidding for enough excess rights and getting the whole 500 units I bid for (was just hoping to get enough to make up my odd lots). Considering the share price is still holding up well (S$1.9), it is a good thing I got all the excess rights I bid for.
This continues to be one of the good investments I have, with decent results. In my short time I have also seen the management move towards more quality properties (in my view) such as asia square and capitagreen, and divesting the weaker properties.
Concerns: Soilbuild REIT
Soilbuild Reit is my other concern this quarter. Soilbuild's tenants are mainly in the oil and gas field, which has not been doing well this year. Besides its earlier troubles at 72 Loyang Way, it had also made an insurance claim and action to repossess property held by NK Ingredients. This is a tenant with 5.8% of Soilbuild's rental income.
Earlier on, Temasek had also sold some shares at 0.68c, showing a drop of confidence in the counter.
Due to these bad signs, I have been wondering if I should hold onto my investment or divest it. While market confidence is low, I bought this REIT with the intention to hold, and thus should not be running off too quickly at a first sign of trouble. Hopefully the management's experience pays off and they will recover in the long run.
2018 plans
Now that I should have more cash inflows with the house renovation done, I would like to start doing some dollar cost averaging on the STI and S&P500, perhaps a small sum like $1000 per quarter. I have much more reits than indexes now and I think I should balance my portfolio more towards a large pool of index stocks.
Expenses Tracking
Having about 6 months of data from keeping tabs on my expenses, it looks like my personal expenses are around $2,500 a month, excluding joint spending with my wife on our house. This is definitely too high! Although this also includes spending on things like insurance, there is also a significant amount of spending on sports, and also the various events with friends that pop up over the year.
If I do not want to feel tied to my current salary, I have to put in more effort to reduce this average spending. The goal in 2018 will be to lower it to $2000 a month. Also, in preparation that I am moving out and hope to have kids very soon, I should expect that the joint expenses will go up, and more money must be channeled there too.
I know my own weaknesses though, sports spending (i.e. Wing Chun Lessons), is a huge part of my life, and its not something I can cut back easily on. I also don't want to pass on experiences with friends who matter just because of cost. How I plan to cut these down would be: 1. Try and take up a TA position in my Wing Chun school, so I can offset some of these costs (though this is barely a motivation for me to teach and it is more to develop my hobby further) ; 2. Really pick the social events I go for carefully, and if I am the organiser, pick more affordable places too; 3. only buy games when there are good discounts on them (yet it is hard to resist getting the latest games at full price...)
Besides these, I could reduce frivolous spending, as it is, I do feel I consider quite carefully before buying a new item for myself. After all, I already have most things I need in life, and decluttering would be good. Another rule I implemented, but with limited success so far, is to keep a low budget when eating alone. Singapore makes this difficult though, it is hard to find light and healthy food options that also taste decent. Most food is either, heavy and cheap (eg hawker food), or healthy(ier) and expensive (eg a salad, which is not even fulfilling). Now that we have our own house, I can look into some ways of packing my own food for these moments. One difficulty is always that it is hard to tell whether I will be eating alone that day. If I can find something I can make that is cheap + healthy + filling + can be kept overnight without a fridge, that would be best.
Boc Credit Card
My credit card plans have also had to be revised. First, DBS took over ANZ, replacing my much loved Optimum card and its 5% dining cashback with a POSB everyday card. Later, Stanchart replaced my Singpost card's 7% cashback on online spend with the new Spree card. Both of these changes had inferior benefits and I promptly cancelled the new cards. I then discovered a new card, the BOC family card, which has very little publicity. This card fills the gap perfectly though! With 7% cashback on dining, and 5% on online purchases, capped at $100 and with only $500 minimum spend. Looking forward to gaining more savings with this card.
However, I tried buying something online today and the transaction could not process. Not sure if this is due to using a China Bank Card to buy from a US store. Hopefully this does not happen too often.
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