Saturday, December 30, 2017

Year 2017 Portfolio Performance and Dividend Income

With the closing of the stock market for the year, it is time to compute the required statistics to measure my performance for the year. In this piece, I will review how I have fared as well as the strategy to employ for the new year.

Similar to what I have done previously, I will go through my dividend income first. For my SGD-denominated counters, the trend in dividends received pales in comparison to 2016. This could be attributed to the following reasons: (a) profit-taking on some of my counters in the earlier half of the year, (b) poor economic conditions leading to some counters delivering lower dividends, (c) delisting of yet another income counter (Croesus Retail Trust), and (d) delays in the declaration of distributions (RHT Health Trust). In 2018, I expect dividends to drop further.

In contrast, the dividend payout from my USD-denominated counters increased. This is primarily due to capital injections into such counters. Percentage-wise, it looks like huge gains. However, I would like to point readers to the y-axis. In dollar terms, it is insignificant. I intend to build-up this portion of my portfolio slowly. Partly to get my feet wet and ease myself into the US stock market and partly to minimize the damage in case of a market correction. Whenever the US market allows, I will continue to nibble at counters in my watch list.

In Q4 2017, I could not resist the temptation and bought quite a number of counters, albeit in small quantities. 

I purchased small quantities of Yeo Hiap Seng for their investment properties. Technically, it is not an asset play (stock price < cash + real estate + securities), but I am treating it as such. Yes, this is a new position.

I initiated a new small-ish position in SATS in October when the price fell. Using technical indicators, the counter was at its 52-week low and is on a downtrend. However, its historical PE trend indicated otherwise. Being cautious, I intend to gradually increase the size of accumulation in proportion to the extent of price depression. However, the price rebounded shortly after my purchase. Anyway, I am holding this counter for its income-generating ability.

I added to my Singtel position in November when the price fell.

I initiated a new small-ish position in HongKong Land in mid-November when the price fell. Similar to SATS, I intend to gradually increase the size of accumulation in proportion to the extent of price depression. Based on historical trends, HongKong Land usually trades at a ~50 percent discount to book value. If, however, you value it using current yield, HongKong Land still has more room for its price to drop (7% yield at its best during the GFC, see here). 

I added to my position/averaged-up in Welltower REIT just last week after monitoring its performance for the past one year (I first initiated a position in the REIT in December 2016). My position is still small. 

I initiated a new small-ish position in Thai Beverage just a few days back. I have been mulling over Thai Beverage for quite some time. "Valuation looks good, but what if the market corrects and I could get a better deal?" "Oops, I think I missed the boat." "Let's wait for that entry price again." "Doesn't seems like it will ever hit that particular price again unless there's a market crash." Similar to SATS and HongKong Land above, I intend to gradually increase the size of accumulation in proportion to the extent of price depression.

I have also added some more (physical) gold to my portfolio.

Using the XIRR function in Excel, my portfolio returns is as follow:

For my SGD-denominated portfolio:
Returns for Year 2017: 19.00%
Annualized returns since portfolio inception (March 2015): 11.60%

For my USD-denominated portfolio:
Returns for Year 2017: 20.09%
Annualized returns since portfolio inception (March 2016): 19.61%

My USD-denominated portfolio includes SGX counters that are traded in USD. Specifically, Dairy Farm, Mandarin Oriental, and HongKong Land. 

There's no typo error in the portfolio inception date. The first counter which I purchased that is traded in USD was Dairy Farm in March 2016. The very first counter which started my investment journey was Nikko AM STI ETF in March 2015.

Oh wow! The returns from my USD-denominated portfolio comes as a real surprise. I vaguely recall all of my US consumer staples stocks bleeding very badly just last month. They have rebounded quite well. The high returns probably come from my holding of Dairy Farm since March 2016 as well as my complete divestment of Mandarin Oriental in Q2 2017 after the company tried to place the Excelsior on the market (see here). 

Meanwhile, the returns for my SGD-denominated portfolio is boosted by the high-quality REITs (MIT, PLife, First REIT, FCT, CMT) as well as other yield stocks (ST Engineering, SGX, FCL) which I have collected cheaply and have been holding on tightly ever since. In Q2 2017, I have taken profit/cut loss on a number of counters, which could have contributed to the returns (see here).

Moving forward, I expect my returns to fall.

Bleeding ones
It would not be fair if I do not point out the duds in my portfolio.

When I do not include dividends, the following counters are in the red: Nera Tel, Starhill, Vicom, Singtel, Kingsmen, QAF, RMG, Yeo Hiap Seng, and Thai Beverage.

After taking into account the dividends received, the following counters are still in the red: Nera Tel, Singtel, Kingsmen, QAF, RMG, Yeo Hiap Seng, and Thai Beverage.

I am not too worried. The potential damage that some of the more-worrisome counters could do to my portfolio is contained through position sizing while I am keen to build a bigger position for some of the other bleeding counters.

So much for trying to time the market and anticipating a market crash. I exited T Rowe Price, iFAST, and Hong Leong Finance thinking that these counters would be hit the hardest in a market crash. Apparently, the market hasn't crashed yet and I look like a complete fool. In fact, I exited T Rowe Price and iFAST at a loss. As of today, T Rowe Price continues to hit higher highs.

Strangely, I am at peace with my decision to divest those counters. I guess it must be my inclination to rather protect my capital from potential losses in a market crash rather than reveling in unrealized gains. 

The only counter which I really have to kick myself is United Industrial Corporation. I chickened out and locked in my profits as I am uncertain how the market would react to asset plays during a crash. Oh well.

Along similar lines, I have also divested my STI ETF in Q2 2017. So much for market timing a market crash. -.-

If there is a market crash, I will be reinstating my POSB Invest Saver account to automate the collection of STI ETF on the cheap.

My investing strategy entails focusing on income from multiple sources. There should not be any sort of over-reliance on any one or few counters. As a result, I diversify/diworsify (depending on how you see it) a lot. 

What I currently have are small positions across many counters. At one time, my largest counter has a market value of $9000. On average, the market value of each of my counters stands at around $1500. Even though I am sitting on plenty of unrealized gains, it makes absolutely no sense for me to lock in profits for some of my smaller positions. I am unable to sell half of my holdings since commission charges would wipe out the returns (good % returns; poor $ returns). Conversely, selling all means killing the golden goose permanently.

Come hell or high water, I would have to be comfortable with seeing my unrealized gains evaporate in a market crash.

Net worth breakdown
Compared to my Q3 2017 update, there does not seem to be much change in my net worth breakdown. Phew! With all the buying in Q4 2017, I am quite surprised that the pie chart did not change much.

As per before, quoting my Q3 2017 update, "The pie chart depicts the breakdown in my net worth across the various asset classes in percentage (pie chart neither includes my CPF nor my emergency fund). To be conservative, I computed my precious metals allocation at spot price even though I am holding everything in physicals."

Strategy moving forward
I'll continue to build up my cash reserves. As and when the market allows, I will continue adding small positions or small amounts to my existing positions.

With plenty of consumer staples (Dairy Farm, Sheng Siong, Thai Beverage, Yeo Hiap Seng, QAF, Kimberly Clark, J.M. Smucker, Hormel Foods, General Mills) and healthcare (PLife, First REIT, RHT Health Trust, RMG, ISEC, Welltower REIT, Abbott Laboratories) stocks, a relatively high precious metals and cash levels, I hope to ride out the market crash.

Thanks for reading!


  1. Hi,

    Interesting to get an peep into your portfolio. 2017 was the year most people expected a market crash due to 1997 and 2007. Good that you do have a contingency plan if it happens.

    I also notice that you do have US counters in your portfolio. I recently started researching about US stocks and were looking through on how to go about purchasing them. I realised that local brokerage (DBS, UOB etc) were not too good as they would charge a monthly custodian fee.

    After doing my research, I found (TD Ameritrade) thinkorswim to be a good option. What are your thoughts on it?

    Thank you and all the best for 2018!

    1. Hi SG Investment Lady,

      I am using Standard Chartered. They do not have any custodian fees or corporate action fees (at this moment).

      I am not familiar with the other two you mentioned.

      Once my account size gets larger, I might consider changing to Interactive Brokers for their small transaction fees.

      Thanks! All the best and Happy New Year for 2018 too! :)

  2. Unintelligent Nerd,

    Wow! That's the most psychedelic and colourful bar charts I've ever seen!

    If I didn't know better, I would have thought there's "rainbow" pride in you!


    Have fun for 2018 :)

  3. Congrats on the impressive return! LOL at SMOL comment.

    1. Thanks! You did well yourself too. :)

      Looking forward to 2018! Cheers!

  4. Beautiful returns for 2017. Congratulation !

    1. Hi Cory,

      Thanks! You have done very well yourself too.


      Let's press on for 2018 :)

  5. Hi UN,

    Nice returns there of around 20%.
    I am curious if the returns stated includes the commission fees + any currency conversion gain/loss based on XIRR calculation. Thanks to advise!

    1. Hi Frowns88,

      Thanks for your comments. Oops, no wonder I felt that I left something out.....

      Okay, here's my response.

      XIRR calculation (for both SGD and USD portfolios) includes the commission fees. (Hence, all my newer counters are "bleeding" after taking into account commission).

      For my USD portfolio, everything is computed in USD (Purchases/Sales in USD, dividends kept in USD account, market value of portfolio in USD) to keep XIRR computation straightforward.

      Thanks for highlighting. You reminded me of yet another assumption which I failed to highlight. This could skew readers' perception of my returns. My XIRR calculation does not include cash drag and precious metals drag.

    2. Hi UN,

      I see. That is a good gain there.

      It will be my pleasure to exchange featuring our blogs on each other's site. would you mind?

    3. Hi Frowns88,

      Thanks again! Done, I've added you to my blog links.

      Wishing you a great 2018!


  6. Hi Unintelligent Nerd,

    Congrats on your 2017 performance.


    1. Hi Passive Income Farmer,

      Thanks for visiting. Let's press on for year 2018! Hope we can secure more dividends!


  7. Hi UN,

    Gratz to ur investing performance.
    Wish u healthy & huat!!! in coming 2018.
    Erh... I like ur chart. Can give give me sample??? I want to do 1 for myself use but I don't know how to do that... hehehe

    Thanks :)

    1. Hi Sy,

      Thanks for visiting again. :)

      Wishing you health and huat for 2018 as well!

      I use R to automatically do those charts one. I can pass you the code. I wrote my code based on Kyith's Stock Market Template. Do you use his template for tracking?


  8. Hi UN

    Yes. I used kyith version also. But don't have monthly chart Like what showing here & I prefer colourful chart also... hehehe
    I don't know how to do the coding stuff... if u don't mind can share :)

    Happy New year & wish u healthy always :)

    1. Hi Sy,

      Sure. Let me go and write a tutorial in word document first, lol (might take some time). Think you need to download like 2 programmes for that. You okay with that?


    2. Sure sure. Me ok. U take ur time.
      Thank q very much :)


  9. Hihi UN,

    I just stumbled on your blog as well.

    Great performance for 2017, congrats!

    If I may ask, what is the overall XIRR for your entire portfolio?

    Warmest regards

    1. Hi Azrael,

      Thanks for dropping by. I've added you to my blog links.

      I don't have information for that leh. =/

      I did not track my DCA into precious metals when I started out in end-2011 nor my cash flow from employment/interest income from my savings account.

      I guess I'm screwed that way :(

    2. Ah, how about purely equities only? :)

      I don't track my employment/interest income into the portfolio as well. :)

    3. I note down the USD/SGD exchange rate at the point of conversion/purchase of US securities.

      But to reconvert them back to SGD and to use them as inputs for XIRR.....that one can die ah. Too many transactions to do it manually, LOL!

      Thanks for the suggestion. I'll try to think of some way to automate the conversion in future postings.


    4. Haha, ya can die if start from scratch.

      But thanks anyway :)

      Hope I can get closer to your performance too :)

  10. Hi UN,

    Happy New Year! And congratulations on your returns for 2017! As usual, I love your cash position you hold there. All the best to you in 2018 and looking forward towards more updates from you !

    1. Hi Sleepydevil,

      Happy New Year to you too!

      My cash position could do better. =/

      Rolf is 50% cash while SI is like 80% cash?