Tuesday 1 March 2022

My Investment Portfolio - SG (End Feb 2022)


Transactions made:
- Bought 2,000 units of CapLand China Trust at $1.16 

Adding shares for the third consecutive month. This time, its CapLand China Trust, a new holding. I had also purchased Ascendas Reit last month, but decided to allocate them to my Wife and Children portfolios. I normally update my purchases via my InvestingNote account on the day of purchase, when CDP sends the sms notification at night. If you want to see a more timely update of transactions, you can see through that mode. 

Reits have been beaten down quite badly over the past few months. Honestly, hand on heart, I do not understand the logic. Hence, the Reits purchases over the last 3 months. Yes, I know, interest rates will increase, but lets not forget the following:

a) Reits and Business Trust with good management have been hedging their interest rates and most of        them have more than 70% of their borrows at fixed interest.

b) Their Debt Tenor (Years) is a few years. It will take sometime for them to feel the full effect of the hike in interest rates. The longer the debt tenor, the better.  For example, if 10% of the loan is due in FY 22/23, then these 10% will probably be borrowed by them at a higher interest rate while the 90% will still be at current rate (before the hike).

c) Increase in borrowing cost, impacting amount available to distribute to shareholders. But lets not            forget that they are able to increase rental as inflation continues (end of the day all prices increase          and consumers lose out especially those who put bulk of savings in bank account that earns less than      0.5% interest rate)

d) They have all gone through a period of interest rate hikes before in the 2000s and 2010s and been           paying out decent dividends. For example, Keppel DC Reit's highest Avergae Cost of Debt (%) was       2.5% in 2015. It was 1.6% in 2021. Take a look at its share price and DPU a few years after 2015.           Take a look at other Reits if you need to. 

I do not really have time to give more details. So this will be it for now. But point I want to make is, Reits are still solid holdings. I have split my warchest into a few tranches and am waiting to do my 2nd deployment if it continues to go down. Hand on heart, I know nuts about timing the market or TA. So I do not time the market. I know clearly, I can never stock pick and buy at the lowest point. 

I am also watching out for SSB interest rate. If it goes up more, I will put some more emergency funds into SSB.  

The recent war that started last week will continue to cause turbulence in the market. Supply chains, oil prices, commodity prices will be impacted as they are all intertwined. Companies that are listed crossed the different value chains of the industries will eventually be 'forced' to raise their prices and pass down increase in cost to end-consumers to protect their profit margin and answer to their stakeholders. So it is important to stay vested and have warchest ready to be deployed when need be. 

I hope the war will end soon. The lives that are lost and damage to environment are irreversible. Why look for other planets to stay in when we cannot even take care of Earth. Even if we find another planet to stay in, we will probably damage that planet since our track record has already been proven.

Dividends received* during the month: $45.6 (Suntec Reit)

Total dividends received in 2022: $290.76

Average dividends per month^: $24.23    

Total Portfolio Market Value: $310,449.57

* Dividends are recognised after payment date. Average dividends per month is calculated by dividing the dividends received by 12 months regardless of the month. 
Portfolio excludes Singapore Savings Bonds, Foreign Stocks, Crypto and Stashaway
Divided by 12 months regardless of month of the year. 

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