That Restless Night…

Leverage in Options and the seemingly unlimited credit

In 2022, Warner Brothers released the movie Elvis, which explores the complex and sometimes contentious relationship between the King of Rock and Roll, Elvis Presley, and his longtime manager, Colonel Tom Parker, played by Hollywood icon Tom Hanks.

As portrayed in the movie, Parker, a compulsive gambler, raked up huge gambling debts and the casino executives called in these debts to pressure Parker to get Presley into an exclusive residency deal. Parker did get Presley a lucrative contract, but the performance schedule was so demanding that it left Presley mentally and physically exhausted. To keep Presley on stage, Parker enlisted the services of an ethically questionable doctor who prescribed Presley prescription drugs, to which Presley eventually became addicted.

Unbeknownst to Presley, Parker negotiated a side agreement with the casino where his gambling debts were forgiven, and Parker got unlimited credit as long as Presley continued performing at the casino.

Options are a type of derivative. They provide the right, but not the obligation, to execute the contract. Derivatives can greatly increase leverage. Leverage by itself can be a great tool that speeds up wealth generation. On the other hand, in the hands of humans, and as Warren Buffett described, derivatives can be “financial weapons of mass destruction.”

Firms and individual investors can lose a lot of money very quickly. You can also lose everything you invest in a single day.

There are a few great articles from Alvin Chow and Jason Cai (see below).

How I Blew Up A Full Year’s Salary In My Trading Account (read here)

My Nvidia Time Bomb (-USD141.5k Unrealised Loss & Counting) | Why You Should Never Sell Naked CALL | The Danger Of Short Selling (read here)

Getting Liquidation Warning | Why I am Getting Liquidation Warning & What You Can Do If You Get Liquidation Warning (read here)

For anyone with a gaming compulsion, unlimited credit is heaven-sent…and Options as a financial leverage product are very close to that, if not for margin calls.

To quote Alvin (emphasis mine): The price went up and the margin got bigger. On 27 Jan 14, I received a margin call from the broker. He asked if I would top up cash to the account to meet the margin requirement. The price of NG was $5.37 and no where near the strikes. But because my position was too big, I did not have enough margin to buffer the rise in price. I refused and wanted to ask for time to close the position when the US market opened at night (Singapore time), as the liquidity was low during Asian market trading hours and the options pricings were erratic with wide spreads. He said he was powerless to grant the request and the margin team will have to close the positions. And sure they did. They closed all my contracts which wiped out my entire capital. That was US$82k!

The Black Swan in Options Trading

Personally, I have always traded using my growth stocks such as Tencent, Alphabet, Pinduoduo, MasterCard, The Trade Desk, etc. I typically trade with what I have, but I do occasionally do some naked options trades with odd lots.

I think Alvin said it best:

“I was my own Black Swan

I didn’t blow up because of an external Black Swan event. I feared the Black Swan but I didn’t know what it is. No one does. Only on hindsight we know what the Black Swan is. I was my own Black Swan – the real me deviated from the perception of myself.

I perceived myself as a very disciplined trader and person in life. I adhere to rules and routine very well. But when I really think back, I do take shortcuts sometimes and I bend the rules a little, believing everything will be fine. Bending most rules were inconsequential. Bending rules when stakes are high is a killer.”

“So what is the difference between selling options or any other strategies? I see one similarity rather than differences – all are risky. I agree with Jon I am picking pennies in front of the steamroller. But this is similar to scalpers, swing traders and trend followers. I will try to jump away from the steamroller as fast as I can so that I can continue to pick the pennies. Jon questioned my overconfidence in jumping off in time and I admit I stand a chance to blow up, without a doubt. And if I do, I hope he will pick me up from there.”

Why Dividend Stocks are terrible for Selling Options

I seldom used my HK-listed dividend stock. For the few times when I tried, I often ended up losing money doing so.

Firstly, the premiums from these low liquidity options positions are really low even if the duration is long. With low premiums, I may be tempted to buy more lots (more than I have assets to cover).

In addition, by having an excessively long duration, I further expose myself to price fluctuations although huge price fluctuations are rather rare for these dividend stocks. However, rare does not mean it does not ever occur. In fact, it did occur a couple of years back when the Chinese authorities made drastic policy changes that generated fear (or exuberance) in the general market, and even mega-cap stocks like Sun Hung Kai Properties, CK Assets ‘ stock prices corrected furiously in a few days. In addition, for every 0.1 percentage change in stock prices, there are magnified percentages (100+% or 1000+%) change in option premium prices.

Such is the power of leverage.

The other feature about HK-listed stocks as compared to US-listed stocks which I noticed, is that for the former, 1 lot does not necessarily mean an underlying 100 shares. It could mean 150, 500 or 1000 shares per lot.

That Restless Night

This restless night relates to one of the rare times when I attempted to sell call options on an HK-listed property stock (Sun Hung Kai Properties).

One thing that I have learned really really fast is not to trade options when I am tired or busy. My mind is just unable to focus and numbers become blurry. A simple bad trade can be costly. It is made even worse when I am selling options on a stock that I am unfamiliar with.

For the record, I do own some shares of Sun Hung Kai Properties (not a lot of shares, but at HKD 73 or SGD 12.68 per share, with brokers typically requiring me to buy/sell in lots of 500 shares, I wouldn’t consider it a penny stock).

I do have a few trading accounts with various brokers. My Sun Hung Kai Properties (SHKP) shares are in my Tiger Brokerage account, which in total have around a low 6-figure SGD value (considering all the other stocks in that account).

So there was one day when I was rather busy at work. Late that afternoon, I decided to try selling call options using my Sun Hung Kai stocks. I looked at my StocksCafe account, which listed the position value and the number of shares for each stock I owned. I made the stupid blunder of confusing the position value with no. of shares. I have a 4-figure no. of shares for Sun Hung Kai which has a 6-figure value (HKD). So I thought I had a 6-figure no. of shares.

For SHKP options, 1 lot = 1000 shares (not 100 shares). So since I thought I have 6 figures (xxx xxx) no. of shares (when I actually only have xxxx no. of shares), I will just sell xxx nos. of lots. This netted me a 4 figure SGD premium (not bad I thought), given the extremely low probability of the stock price hitting the strike price (literally looking at the Delta and IV, it is actually less than a 2% chance).

Shortly after my positions were filled, the market closed. Subsequently, I noticed that my account liquidity is extremely low and is actually at Risk.

So I started reviewing the numbers. When I realized that the underlying shares under the options I sold were close to 100 times the number of shares I actually have, and since 1 lot is equal to 1000 shares, the underlying value of the shares for the option position is more than HKD 12,000++k or SGD 2++ mil. I almost freaked out (I don’t have SGD 2 mil worth of SHKP shares, I only have a low 6 figures HKD worth or low 5 figures SGD worth of SHKP shares).

Although there was a very low chance of the stock price ever rising to the strike price, it could still happen. In addition, even before it hits, my entire Tiger Brokerage account would probably be wiped out (liquidated) due to margin calls.

I tried to close the options position during the after-market hours (e.g. buy the options), and I got a ridiculous premium price which was more than 100 times the options premium price I sold, which was different from the price shown for that strike price. I reckon it is 1) Aftermarket, there were no sellers 2) Glitch in the system.

The Hong Kong stock market trading session covers periods from 9:30 am to 12:00 noon and 1:00 pm to 4:00 pm each trading day. It ends earlier than the Singapore stock market. In other words, I had a longer period of being tormented by my mind. Dinner was tasteless and I could not focus on the TV show or conversations with my family.

I literally had the MOST unrestful night ever that night. With my account value (6 figures SGD), I can actually use leverage via options to have access to more than 10 times the value of stocks. With every small percentage change in stock price, the percentage change in option premium prices is magnified! I can’t imagine what it would be like if it were options for volatile stocks like Nvidia.

For what… for a few ‘pennies’ (of Options premiums)?

The next morning, I managed to close my option position at a slight loss. Which I am thankful for. At least from then on, I can sleep in peace.

Yes, options are as close as we can get to unlimited credit, but it is something I wish I never had. In retrospect, I am surprised that I could actually access that much value of shares with the low-cost brokerage account value I had. Still, it is something I wish I never had.

We often heard success stories from people who used leverage, to get rich quick. Well, I just hope I am not my own black swan and has a good night rest.

Thank you for reading.

 

StocksCafe

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Webull

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Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

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FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

 

Wise Card

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Shopee

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Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

My neglected portfolio, the Story Fund

My Portfolio

I have a mixture of growth stocks, dividend stocks, REITs, and SSBs in my portfolio (not counting my CPF, T-Bills, cash, insurance, property, etc).

As mentioned here, my portfolio basically consists of a Dividend Portfolio and a Story Fund. The Dividend portfolio consists of 2 parts: the Singapore Portfolio and the Hong Kong Portfolio. The Story Fund consists of US and Hong Kong-listed growth stocks. The stocks within each portfolio might have changed much.

To be frank, in recent years, I have been actively investing and adding to my dividend portfolio, and building up my war chest via the Singapore Saving bonds (and cash). Currently, the dividend portfolio occupies approximately 77.1% of my portfolio value. While the Story Fund portfolio on the other hand only occupies 18.1% of the total value. So yeah, in a way, the Story Fund was kind of neglected.

The Story Fund

Initially, I wanted to create this barbell portfolio consisting of both growth stocks, to capture the future growth and dividend portfolio for cash flow. I got the inspiration for the name ‘Story Fund’ from the financial YouTuber Joseph Carlson.

My Story Fund Stock Portfolio (read here)

It is a relatively small portfolio consisting of both US-listed and HK-listed growth stocks ie. Alphabet, Mastercard, The Trade Desk, Tencent, Pinduoduo, Baidu and Meituan. I got the Meituan stocks as a payout from Tencent.

The performance of these stocks has been rather erratic.

The US-listed stocks clearly are the outperformers here, where I more than 2x my original vested amount with Alphabet stocks. I also have unrealized gains from Mastercard and The Trade Desk.
I divested my Alibaba stocks in around mid-2022 at a loss and used the liquidated amount to invest in Tencent. Currently, my investment in Tencent is at a slight loss (less than 10%).

Among the ‘Chinese growth stocks’, the outlier is Pinduoduo (PDD), which is in positive territory (unrealized gains) due to its impressive earnings. FYI, PDD is listed in the US Market, not in Hang Seng.

The negativity associated with geo-political risks, lackluster property and economic growth in China, and restrictions imposed by the US on China on AI chips seem to have little effect on PDD. Investors appear to focus more on the optimism of the profit growth generated by Temu. In fact, I was rather surprised by its strong stock price performance, it appears to be at odds with the general gloomy outlook. Nevertheless, PDD P/E is only at 20.31 despite its 93% rise in annual profit. I can only imagine what its stock price chart would be like without the macro pessimism.

As per the below chart, the Time Weight Returns (TWR) of my Story Fund portfolio have underperformed the S&P 500’s TWR. I reckon it is due to the HK-listed growth stocks in that portfolio. They are like weights tied to the ankles.

These days, my focus has been more on income cash flow (i.e from dividends primarily and also from premiums via selling options of growth stocks). I guess, as I slowly inch towards the retirement age, my mindset is more on how to replace my active income when I eventually stop working.

Article from Oaktree

I came across this article by Oaktree dated 28 March 2024, which I find rather insightful. Please see below.

The Roundup: Top Takeaways from Oaktree’s Quarterly Letters – March 2024 Edition (read here)

I find section 6 of the article titled “Emerging Markets Equities: Piling On” rather interesting (highlighted portion by me).

I extrapolated the iShare U.S Technology ETF chart and the Hang Seng Tech Index ETF. Currently, the iShare U.S Technology ETF has a P/E (TTM) of 40.59 while the ishare Hang Seng Tech Index ETF has a P/E (TTM) of only 17.14.

As I was looking at the chart and reading the article, my personal feeling is that Chinese growth stocks are just punished despite their improving fundamentals. Perhaps in addition, to the risks mentioned earlier, there is also a certain opaqueness when it comes to Chinese Stocks. As investors, we are always concerned about accountability (esp. when things go south).

The rise of Pinduoduo and Temu: profits and secrets | FT Film (Watch here)

There was a time when Chinese stocks were all the buzz and their prices tracked the rise and fall of their US counterparts (before 2021). These days, the buzz has died down, replaced by the silence of untold losses.

What is measured gets done

As per my earlier post, I have been doing some option selling, and I do see the benefit of doing that while waiting for the Chinese growth stocks to eventually play catch up with their US counterparts. It could be years…

Tracking my Passive Income (read here)

While the annual cash flows of Alphabet, Mastercard, and The Trade Desk (the latter two in particular) have improved in recent years, PDD, Tencent, Baidu, and Meituan’s annual cash flows have also improved. Stock prices did not keep up.

I decided to do a quick stocktake of my past investment moves in my Story Fund portfolio against the above-mentioned charts.

Looking at it, I realized that I made a few purchases of US growth stocks in late 2022, and did not make any US growth stock purchases in 2023, while the US Tech sector prices marched up. After 2021, I have been adding more to my HK growth stocks although I divested from Alibaba and replaced it with Tencent in around mid-2022.

I only made a couple of purchases of HK growth stocks in 2023.

Recently, I sold a put option on Tencent stocks, and the price went below the strike price. I reckon the option should be exercised soon and I will be allocated the Tencent shares.

A small step onwards.

Thank you for reading.

 

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

BigFundr

BigFundr offers real estate-backed investment deals. Your principal and interest are 100% guaranteed by Maxi-Cash when you invest with BigFundr. Sign up now using my referral code R26458M. You will get S$10 as a reward!

Dobin

I have started using this personal finance app: Dobin. It helps to manage my money and save on everyday purchases. Download the app here: https://www.dobin.io/download

PS: Make sure to enter my referral code when you signup: LNPKMFS

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

 

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

 

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

 

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

 

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

 

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

Nvidia, Bitcoin, Cocoa’s prices have all hit new highs recently. Why I am not chasing the ‘rainbow’…

These days with all the hype surrounding certain investments/assets, it is hard not to think about it or have the urge to invest money into it. I do not think of myself as a seasoned or even a successful investor. However, having witnessed the ups and downs of equities, and crypto-currencies, let me share my thoughts on why I would probably be missing the ‘upswing’.

I am not sure about you, but personally, for me, I felt that ‘expensive’ lessons are inevitable for anyone starting out investing on their own. As much as I am risk-averse, I do from time to time make impulsive bets and get myself burnt.

Oh Wow… What have I missed?

In my previous post, I briefly mentioned about 3 assets currently that are on a tear.

1) Nvidia

2) Bitcoin

3) Cocoa

Magnificent 7

I am sure there are more. For instance, beyond the forerunner Nvidia among the magnificent 7 (Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, and Tesla), some of the other mega tech stocks are performing well fueled by among other things the AI frenzy.

As a whole, the magnificent 7 had a great run for the past 5 years. What a nice chart below…

Cryptocurrencies

At the point of writing, the price of bitcoin is around USD 69,000. On 13 March 2024, its price crossed USD 73,000. In addition, Ethereum (ETH) has been gaining too. The leading altcoin is now worth more than $3,500 and crossed USD 4,000 in March 2024, which is a significant gain, but still shy of its pre-crypto winter high of more than $4,700, which was set in November 2021.

A major driver for this appreciation in prices has been the US authorities’ approval in January of an investment vehicle known as an exchange-traded fund or ETF for the general or “spot” bitcoin market. An ETF is an easy way for the average saver to get exposure to an asset, since they buy shares in the vehicle, usually through their financial advisor, rather than having to go to the trouble of buying the underlying asset.

A total of 11 bitcoin ETFs were approved in the US, and their daily trading volume has now exceeded US$10 billion.

The other reason could be Bitcoin halving. One feature of the bitcoin system which was built in at the beginning is that, roughly every four years, the rewards to companies using arrays of computers to create or “mine” bitcoin get cut in half.

The last halving took place in May 2020, where miners went from receiving 12.5 bitcoins for each unit of work they do to 6.25 bitcoins. The next is due to take place on April 19, cutting the reward down to 3.125 bitcoin.

Cocoa

Then there is the surge in cocoa prices (technically, among the trio, its price accelerated the most in recent months). Nothing complex, nothing hi-tech, just the simple humble cocoa.

The steady rise in the price of cocoa beans over the past two years skyrocketed in March 2024, with futures contracts more than doubling in three months to reach a level twice as high as the previous record.

Unlike most crops grown for global commodity markets, cocoa is produced not by large-scale plantations but by small farmers, many in West Africa, which has dominated the trade for decades.

Ivory Coast and Ghana are still forecast to supply 53 per cent of the world’s cocoa in the current season – a share that was even higher before current crop issues.

Some of the factors that have been driving down production include:

• Both rain and drought have been more severe than usual in West Africa;
• Swamped fields have worsened the spread of diseases such as black pod disease and swollen-shoot virus, which are rotting pods and killing trees, and the tree stock is also ageing;
• The small farmers in Ivory Coast and Ghana have long been underpaid, and governments set prices in each country ahead of time, so producers have yet to profit off the current rally; and
• Low pay has hampered farmers’ ability to invest in improvements and fend off disease, limiting how much cocoa their trees can yield.

At this point in my post, it is appropriate to cue this song by Katy Perry. Enjoy!

Our thinking is shaped by our past experiences

However, this post is about why I do not want to chase the prices of these assets.

“Unfortunately, resilience matters in success, I don’t know how to teach it to you except for I hope suffering happens to you.” Nvidia CEO and founder Jensen Huang (read here)

If I am to simplify and break down in 2 simple parts, on how I can be a better investor, it would be:

1) Having the guts and ready resources to invest during times of great crisis, and take losses;

2) The second and equally important part (if not, more important), is having the ability to NOT invest due to FOMO (Fear Of Missing Out). The ability to give up on future gains and be at peace with oneself.

There is a great article about “FOMO” in Seeking Alpha, and how to overcome it. Namely, doing research, sticking to a Trading Strategy, keeping the position small and only investing what one can afford to lose, being patient, and keeping track of the trades.

Well, these are all great moves when it comes to dealing with FOMO.

However, for me personally, I have made many bad investments (or rather trades) which are rather expensive.

Perhaps you are wiser than me, more careful with your cash. Still, I believe, that if one is vested in the stock market for long, sooner or later, there will be losses. Often than not, it is better to lose early to learn early. The worst is probably for the newcomer to gain a lot at some of his initial trades (beginner’s luck).

Unless you avoid all risks. i.e. Don’t invest in the stock market.

“Maybe you’re right 5 or 6 times out of 10. But if your winners go up 4- or 10- or 20-fold, it makes up for the ones where you lost 50%, 75%, or 100%.” Peter Lynch

When it comes to investing, my core memories are primarily occupied by my big losses. Some of these are still in my portfolio, while most I have sold at a loss. On another note, if I need a refresher on my memory, I can always read up on my old blog posts. That is like saying if I find joy in pain.

Without a doubt, some of these stocks were bought when there was hype surrounding them, and in retrospect, prices were elevated.

My investment journey is filled with wins and losses. As for the losses, below are some of them.

1) Golden Agri-Resource Ltd

I can’t even remember when I first started investing in Golden Agri stocks, perhaps it was around 2011 or earlier. I still have the stocks as one of my holdings in my dividend portfolio.

What is Fair? Golden Agri-Resource Ltd (read here)

Golden Agri (Better days ahead?) (read here)

There was a period before 2010 when palm oil stocks were all the rage, and also before the issues of the destruction of the livelihoods of smallholders, displacement of indigenous peoples, deforestation (and the resulting haze in SE Asia), and loss of biodiversity are linked to the consequences of palm oil consumption. Do you still remember the rush to buy air purifiers when the haze reach Singapore from Indonesia?

As a commodity stock with little pricing power and with multi-year low stock prices, my damage (unrealized loss) is in the 5 figures.

Lesson learned: Avoid cyclical commodity stocks with no business moat or pricing power. Not to bottom fish, lower can go even lower.

2) Creative Technology Ltd

Talking about hype, I would say this trade epitomized that.

Creative Technology Ltd. (C76.SI): When the Story is Stronger than the Numbers… (read here)

Notice that surge in price sometime in early 2018. For the longest time, Creative Technology Ltd is one such ‘Zombie’ stock. ‘Zombie’ because it is basically a living dead stock. It is listed on the exchange but for years, it hardly registers a heartbeat (its share price oscillates around $1 from late 2015 to early 2018).

During that period Creative introduced the Super X-Fi technology.

Super X-Fi captures the listening experience of a high-end multi-speaker system in a professional studio, and recreates the same expansive experience in your headphones using computational audio intensive techniques to custom fit audio, for every individual, through a sophisticated Head and Ear-Mapping process.

There was so much buzz during that time. Unfortunately, after the hype, the stock price also resumed its zombie-like existence. I have sold off my position shortly after the hype. The loss was almost immediate after my initial investment, with no rebound (at all). My damage is in the high 4 figures.

Lesson learned: Simple – Don’t fall for the hype.

3) Sarine Technologies Ltd

I have done a lot of posts on Sarine Technologies in the past (read here). Did a lot of studies on it. Was very sure about the numbers, and business model. In fact, at one time, it was a rock-solid stock with strong fundamentals, units sold were increasing, but profits were not keeping up though.

The issue is the structural change in the industry with the rise of synthetic diamonds. The other issue with this investment is that I concentrated a rather large amount of my portfolio on this one stock.

I have sold off my position. The damage was rather huge for me at that time. It is in the 5 figures. This lesson is one I cannot forget.
Firstly, no matter how strong the numbers or fundamentals, and how much research and patience one has, it is important to diversify. No single stock position to occupy more than 15% of the total value of the portfolio.

Lesson learned: Doing more research can do more harm (like a self-reinforcing mantra and a vicious cycle of self-believing). No matter how confident I am about the fundamentals and narrative, I could still be wrong (painfully wrong). It is important to diversify and not concentrate.

4) Digital Core Reit

Digital Core Reit: When the tenant goes bankrupt (read here)

Digital Core Reit: Down the Rabbit Hole We Go-Management (read here)

For the longest time, I have wanted to partake in the sunrise sector of tech and data centers. And with the announcement of the pure play data center Reit that is going to IPO in our local stock market, it seemed like a dream come true. Growth + Dividend.

Alas, shortly after my investment into this Reit, issues started cropping up in this relatively new and small Reit which has a rather small and concentrated tenant base, all the way located across the Pacific Ocean in the US assets.

I am still vested in this Reit. My damage (unrealized loss) is in the 5 figures.

Lesson learned: Avoid IPOs and hype. A longer duration is needed to assess the figures and fundamentals. Avoid REITs that are not diversified. Be more careful with Reits with overseas sponsors. Important to diversify and invest small amounts at the start.

I like to call them as a whole, my 6 figures lesson learned. Expensive lesson (probably priceless), and I will remember these very very well.

Basically, I want to be honest with my failures. I reckon that is the first step to overcoming them,. First, be aware, acknowledge, and learn from them…. quickly.

“Unless you have a tolerance for failure, you will never experiment, and if you don’t ever experiment, you will never innovate. If you don’t innovate, you don’t succeed.” Nvidia CEO and founder Jensen Huang

Thank you for reading.

 

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

 

BigFundr

BigFundr offers real estate-backed investment deals. Your principal and interest are 100% guaranteed by Maxi-Cash when you invest with BigFundr. Sign up now using my referral code R26458M. You will get S$10 as a reward!

 

Dobin

I have started using this personal finance app: Dobin. It helps to manage my money and save on everyday purchases. Download the app here: https://www.dobin.io/download

PS: Make sure to enter my referral code when you signup: LNPKMFS

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

 

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

 

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

 

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

 

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

 

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

Tracking my Passive Income

This is just an update on my monthly passive income.

“Being Able To Grow Old Is A Fortunate Thing” Jackie Chan, 70

I think as we inch closer to retirement, it is important to consider the following:

1) Passive income cash flow amount,

2) The stability/predictability of these cash flows,

3) Allocations into different sectors so as not to miss out on any future growths and to spread out the risks.

In terms of stability of cash flows, we could visualize our funds in terms of tiers in a pyramid, with CPF/Singapore Saving Bonds/T-Bill as being in the lowest tier forming the base.

This post is more related to the second-tier investments i.e. REITs, Dividend stocks. And a bit of the Singapore Saving Bonds at the first tier. If I may stretch it a bit, the selling of options of the growth stocks in the third tier.

Some people prefer to refer to these as ‘taps’.

Golden taps are like those assets at the lowest tier i.e. CPF, SSB, T-Bills, and Cash.

Silver taps consist of assets like Dividend stocks, REITs,…

Copper taps consist of assets like Growth stocks, Crypto, etc. You get the picture.

Perhaps the article below said it best and I quote: “The goal of retirement plans should be providing income to those no longer working, not accumulating wealth for those who still are.”

Wall Street Just Doesn’t Get Retirement (read here)

Or even if we are not aiming for full retirement, having another stream of cash flow might just let us ‘Live earlier” to attain FILE.

The Difference Between FIRE and FILE (and Which Is Right for You) (read here)

Personally, I always felt that there was another younger version of myself who is also contributing to my retirement ‘pot of gold’. As much as I focus on my active income via my job, I would also spend my spare time growing ‘my other self’.

Premiums from Selling Options

Technically not exactly passive. Nevertheless, shall do a short update here.

The month of March has been rather uneventful. As anticipated, on 20 March 2024, the Federal Reserve held rates steady and stated that it would maintain its policy rate in a range of 5.25% to 5.5%. The March decision marks the fifth consecutive meeting at which the Federal Reserve (Fed) has opted to hold interest rates steady.

In addition, all my options positions’ durations did not overlap any of the respective companies’ earning calls. Thus, there were no unexpected price volatilities due to surprise earning reports. Premiums from Options for March came in at around S$744. So far, comparing each month’s premium amount, there are improvements YoY.

So in general, with an uneventful month (March 2024), all my option positions expired as planned.

Nevertheless, during the uneventful month of March, I came across this funny quote (and for the year so far) for me: ‘We are not gangsters, we are ACS boys’.

On another note, if the unexpected happens, and my call options or put options are exercised, it may actually be a good thing as they really have far-out strike prices. Often way above or below my average purchase prices (for the call options and put options which I have sold respectively).

The next Federal Open Market Committee (FOMC) meeting is scheduled for 30 April to 1 May 2024. All my current option positions that expire in April would have expired by then, except for a couple of positions that straddle into May 2024.

Still, the general consensus is that the Fed will not cut rates so soon. The US economy and inflation are still too strong for the Fed to cut rates within the next few months. Inflation is still well above the Fed’s 2% target.

Dividend and Bond Interest Income

While for the Option Premiums, the monthly amount seems to be improving and seems to be in line with my financial target for 2024. Dividend and Bond interest income is another story.

‘My mistake was the complacency to think that this will last forever,’ Joseph Schooling

Looking through the dividend and bond interest income payout chart in my StocksCafe account, it seems that 2024 will be a difficult year for this section of my passive income. The monthly amounts received in January, March, and April 2024, are lower compared to the amounts received in the respective months in the previous year, 2023. This is despite the boost in dividend payout from DBS in April 2024.

As mentioned in my previous post, given the geopolitical risks for China/HK stocks, the persistently high-interest rates, and the forex volatilities, many dividend stocks in my dividend portfolio have lowered their dividend payout this year.

“Interest rates are to asset prices, you know, sort of like gravity is to the apple,” Warren Buffett 

If interest rates are like gravity, then it seems that a few of the cash-rich magnificent tech stocks that are always in the limelight, crypto-currencies (i.e. Bitcooin) and Cocoa, have somehow managed to blast off and escape its pull.

Stacking them up…

A quick tabulation below shows my passive income so far (well, exclude CPF, T-Bills, Insurance, etc). If all things go as planned, in April 2024, my passive income would have crossed $4000. In March 2024, it came close to the $4000 mark.

Perhaps they could have this feature in StocksCafe, whereby the monthly premiums and dividend payout are stacked up in an easy-to-read bar chart.

Thank you for reading.

 

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

 

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

 

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

 

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

 

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

 

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

 

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

Thoughts on Allocation and Effects of Interest Rate Changes…

It has been a slow month basically for me in March. I did not have more ‘powder’ to invest and in addition, I started contributing to my SRS. For my SRS investments, I tend to limit myself to a few stocks for ease of tracking.

Allocations & Markets

These days I spend more time thinking about allocations, while also reading up on individual stocks. There are different ways to slice and dice my portfolio. One way is to classify them as per below (based on where they are listed).

This is not a true reflection of course, as many Singapore-listed stocks have a significant portion of their assets in other countries (be it US or China, etc). Case in point, HongKongLand which is listed in the Singapore stock maket but its assets in Hong Kong, Macau, Chinese Mainland contributed 96% of its revenue in 2023. Likewise, SG-REITs like Mapletree Pan Asia Commercial Trust and Mapletree Logistics Trust have significant portions of their assets in China/HK.

I am still a believer of the China growth story and Hong Kong list stocks in general and yup, I do not think that are un-investable.

The current P/E (TTM) of the Hang Seng Index is at 7.80 on 5 April 2024, which is below the long-term average of P/E ratio of 10.16 suggesting that it is undervalued. Please see the 10-year chart below.

In the case of the Straits Times Index, the average P/E (TTM) over the last 10 years is 13.05. At the current P/E ratio of 11.27 on 5 April 2024, it would be considered undervalued.

On the other hand, the S&P500 led by the magnificent 7 stocks (Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla) which account for about 29% of the S&P500, has a P/E TTM of 26.69 on 4 April 2024, which is above its Long Term Average P/E of 23.93. Hence it is considered as overvalued. Please see the 10-year chart below.

For this month (March 2024), I added to my positions in Baidu, Lam Soon, Link Reit, and Mapletree Logistics Trust.

Given the negativity surrounding China and HK-listed stocks due to the myriad of issues there (geo-political risks, aging population, high unemployment rates, property and economic slowdown, etc), it is no surprise that the Hang Seng index is generally undervalued. Consequently, value-wise, the percentage of my HK-listed stocks in my portfolio has shrunk (despite my added investment into HK-listed stocks).

I was watching this recent video by Kelvin Learns Investing which was Streamed live on 23 Mar 2024 (Kelvin and Budget Babe are both in it). I thought it was quite good, and well-thought-out. Rather entertaining as well. In the beginning, Budget Babe was talking about the performance of the various market indexes, and being diversified sort of balance out (the good and bad for your portfolio); and S&P 500 P/E is rather high right now… But somehow subsequently she went on to elaborate about the Apple stock which is listed in the US market (although the Hang Seng index has underperformed relative to other markets for years. Would another comparable tech stock listed in Hang Seng offer better opportunities, despite the myriad of issues faced by Apple now?..if I follow her train of thought correctly). I reckon she is more comfortable investing in the US markets given geopolitical risks factored into HK/Chinese stocks.

Nasdaq and S&P 500 soar to record highs as markets appear unsinkable (read here)

I have yet to add to my Story Fund stocks and have been mainly using them to sell options. At the back of my mind, I have been toying with the idea of creating a much smaller but more speculative portfolio consisting of crypto-currencies, AI-related stocks (or even ETF linked to commodities such as uranium or copper which I feel would be a sunrise sector in tune with the rising need of AI and energy in general).

Now is not the time I feel.

Passive income target: Harder than I think

My financial target of increasing my monthly dividend passive income this year appears to be harder than I thought. Many of my dividend stocks (esp. those non-financial related ones) are lowering their dividend payout. Even Hong Leong Finance.

1) Mapletree Pan Asia Commercial Trust 3rd Quarter (FY 2023/2024) dividend payout is 2.20 cents (vs 2.42 cents a year ago).

2) Golden Agri Resource in Feb 2024, recommended a lower final dividend of S$0.00613 per share, as opposed to the S$0.00991 final dividend paid out in the same period a year ago.

3) CK Asset Holdings Limited in March 2024, announced that it will pay a final dividend of HK$1.62 per share (compared to HK$1.8500 a year ago).

4) Digital Core Reit in Feb 2024, reported a distribution per unit (DPU) of 3.70 US cents for FY2023 ended Dec 31, 2023, 15.9% below forecast and a 7.0% drop from its FY2022 DPU of 3.98 US cents.

5) International Housewares Retail announced in Dec 2023, that they will pay an interim dividend of HKD 0.056 (vs HKD 0.1200 a year ago).

6) Hong Leong Finance on 23 Feb 2024, proposed a final dividend of S$0.09 per share, down from the final dividend of S$0.1325 per share in FY22.

7) Fu Shou Yuan in March 2024, proposed a final dividend of HKD 0.0686 (vs HKD 0.0758 a year ago).

8) Guangdong Investment Ltd in March 2024, proposed a final dividend of HKD 0.1233 (vs HKD 0.4262 a year ago).

While I have been slowly DCA-ing into selected holdings, the anticipated monthly dividend payout as shown in my StocksCafe account did not increase much.

With news about the imminent cutting of interest rates by the Federal Reserve, it may appear that the S&P500 is running ahead of itself. Nevertheless, a few scenarios are playing out in my mind.

Generally, a decreasing interest rate environment will benefit stocks (or as many would put it, a rising tide raises all boats). However, if I am just to consider interest rates alone, I think for some Hong Kong-listed stocks – the effect is more pronounced.

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

The Worst Performing Hong Kong Reit

I came across this article by the Fifth Person titled, “Top 3 Hong Kong REITs that made you money if you invested from their IPOs (Updated 2024)”, read here.

To quote the article: ” …since the protests in 2019, investing in Hong Kong’s stock market has proven challenging. Hong Kong Real Estate Investment Trusts (HK-REITs) have suffered in particular and the sector has been on a downward trend since. However, those who invested in these REITs from their initial public offerings might find themselves pleasantly surprised by the outcomes.”

The article talks about David (a fictional character) who invests HK$10,000 in each Hong Kong REIT from the day it listed. Since David is a hard-core income investor, he doesn’t want to come out with any more money to subscribe to rights (if any) and is prepared for any share dilution. Let’s also assume that he neglects to sell his nil-paid rights from which he can make a profit from.

The top 3 performing Reits are Link Reit, Fortune Reit, and Sunlight Reit if David has invested since they were listed.

However, that was not what caught my attention. What caught my attention was Hui Xian Reit which IPO-ed in April 2011. And despite the past almost 13 years, the investor (David) still did not manage to make a profit even after considering dividends.

Perhaps it is the contrarian part of my mind at work, but I am always interested in the ‘fallen’ stocks, although I am well aware that not all fallen stocks will turn around. I typically leave stocks that are performing well alone, but I tend to read more into stocks that are laggards. Nevertheless, there are often deep structural issues with the business models – these, I tend to avoid.

The other reason why I am intrigued is because I am indirectly vested in Hui Xian Reit via one of my holdings – CK Asset Holdings Limited. CK Asset owns 34% of Hui Xian Reit, and the latter contributed HK $55 million in profit to CK Asset in 2023. CK Asset’s total profit contribution in 2023 is HK $1,525 million. So though Hui Xian Reit’s contribution is not a small amount, percentage-wise it is not that significant especially compared to the contributions from Fortune Reit and Prosperity Reit (to CK Asset’s revenue).

Hui Xian Reit appears to be a vehicle for Li Ka Shing to unload his Chinese properties. It is also a real estate investment trust demerged from Cheung Kong Holdings. Perhaps that explains the relatively high percentage holding by CK Asset.

LI KA-SHING SELLS CHONGQING COMPLEX TO OWN REIT FOR $638M (read here)

I have mentioned earlier a list of my stocks with recent YoY declining dividend payout. CK Asset is one of them. Other blue-chip HK property peers in my portfolio such as Sun Hung Kai Property and Link Reit have done better (dividends are increasing). Also, Mapletree Logistics Trust with about 19% of its assets in China, managed to eke out higher DPU recently for its fiscal 2024’s third quarter (3Q FY2024) ending 30 September 2023.

So yes, I am intrigued.

Hui Xian REIT is the first RMB-denominated REIT listed in Hong Kong. Its portfolio spans across retail, office, serviced apartment, and hotel businesses. The properties are all situated in China. i.e. Beijing Oriental Plaza, Chongqing Metropolitan Oriental Plaza, The Westin Shenyang, Hyatt Regency Metropolitan Chongqing, and Sheraton Chengdu Lido Hotel.

It is common knowledge that since the second half of 2022, with the increase of interest rates by the Federal Reserve and subsequently by major banks, one of the hardest hit sectors is the REIT sector due to the elevated borrowing costs.

Just to give some examples from what I have read:

In its 7 Feb 2024 presentation, MPACT stated that the decrease in distribution was due to “Higher net finance costs due to increased interest rates on SGD and HKD borrowings; and Release of a one-off cross currency interest rate swap (“CCIRS”) gain in 3Q FY22/23 that was absent in 3Q FY23/24″.

On 1 Feb 2024, Digital Core Reit mentioned that “they delivered a full-year distribution per unit of 3.70 U.S. cents, down just seven percent year-over-year, as they managed to offset a significant portion of the much higher-than-expected interest expense through accretive investments and proactive cost containment.”

And with regards to the rising interest rates, amongst the REITs, perhaps the hardest hit are REITs such as Hui Xian Reit whereby the revenue is in RMB but the debts are denominated in HKD. Since April 2022 Chinese Yuan Renminbi has been steadily dropping against the Hong Kong dollar.

As the HKD tracks the USD, Hong Kong central bank has to let the interest rates track the moves of the US Federal Reserve (i.e. keeping rates high). While China banks are cutting rates to boost its ailing property sector.

China’s Loan Prime Rate is at 3.45%, compared to 3.45% last month and 3.65% last year. This is lower than the long-term average of 3.77%.

On the other hand, the US  federal funds target rate has remained at 5.25% to 5.5% since summer 2023, the highest it’s been in over 20 years. The Fed raised the rate 11 times between March 2022 and July 2023 to combat ongoing inflation.

Hong Kong central bank leaves interest rate unchanged, tracks Fed (read here)

China’s Rate Cuts to Pressure Bank Profits, Provide Slight Economic Boost (read here)

China cuts key interest rate in the latest move to boost its ailing property sector (read here)

Meanwhile the Chinese Yuan has been sliding against the USD and the HKD.

China’s yuan slides near 16-year low as economy struggles (read here)

Hence, despite the YoY increase in Net Property Income to the tune of 68 RMB Million (or +5.3%) by Hui Xian Reit, it is nevertheless, negated by the the increase in interest expenses and a realized exchange loss, leading to a YoY reduction in 2023’s distribution. In the end, amount available for distribution tanked 60.5% YoY.

I am just wondering what the REIT management would be thinking… after all the hard work to turn this around and the hotel portfolio rebounded, actual performance (amount available for distribution) still dropped around 60% YoY and share prices tanked.

The below presentations are extracts from Hui Xian Reit’s Annual Results Presentation for the Period from 1 Jan 2023 to 31 Dec 2023 issued on 8 March 2024.

So in simple terms, their loan interests remain high (or keep increasing), while their profit although technically increases YoY, when converted from RMB to HKD, the increase is diminished.

When the tide changes…

‘My mistake was the complacency to think that this will last forever.’ Joseph Schooling

I am sure there are more factors to consider than just interest rates when evaluating the future prospects of stocks and REITs. However, the general consensus out there is that lower interest rates are good for stocks, be it growth or value stocks. And especially for debt instruments like REITs.

The Federal Reserve has six more chances to cut rates in 2024, starting with its next meeting at the end of April. The Fed sees three rate cuts in 2024. When it happens, all kinds of borrowing will be easier for the average American… and for the Reits, over the long term it will help with the borrowing cost and in some cases reduce the exchange losses although the effect will not be immediate as rates will still stay elevated for some time.

Fed officials say three rate cuts a reasonable baseline for 2024 (read here)

As mentioned earlier, a rising tide raises all boats, but for some, it will rise higher.

Hui Xian Reit is an extreme case. It is literally in the wrong place at the wrong time; like a tiny boat in a perfect storm. Most REITs in my holdings are more diversified with assets in various countries. Yes, there are advantages to diversification when it comes to my own portfolio.

Some thoughts

Yield gap between China and US widens to highest since 2007 after surprise rate cut (read here)

To quote the above article dated 16 Aug 2023: “China remains an outlier among global central banks as it has loosened monetary policy to shore up a stalling recovery whereas others, particularly the United States, have been in tightening cycles as they battle high inflation.”

Firstly, I do not think I am great at anticipating swings in the stock markets, sectors, or individual stock prices. In addition, I am not a policymaker or an economist. I can’t predict how policies in the US or China (especially) will change. Given the recent years’ experience, I would not be surprised by sudden policy changes in China (again). Nor will I be able to predict the shifts in the fundamentals of the domestic economies that will in turn affect (inflation and) interest rates. There are many factors affecting interest rates, factors which I as a small retail investor cannot comprehend or anticipate.

If there is one thing I am certain about the stock market – it is that nothing is certain.

However, I like to use the analogy of probabilities when it comes to the stock market. Like how Howard Marks would describe – opportunities in the stock market i.e. the chances of profiting get better when markets tank lower.

Given that the yield gap between these 2 major economies (the United States and China) is the biggest since 2007, what are the odds of it becoming even bigger?

Is it possible that it will become bigger? Sure.

Is it probable that it will become even bigger? What is the odd to that?

And if the yield gap is getting smaller – how can I profit?

How will it affect stock prices? Well, it is hard to predict stock prices, but earning-wise we can make some calculated guesses.

I always felt that share prices are harder to predict than dividends (especially dividends from REITs since real estate trusts must distribute 90% of their taxable earnings to existing shareholders). This is especially so if we are talking about actual cash returns to shareholders. We could be right about the earnings prediction for multiple quarters or years, but “the stock is not the company, and the company is not the stock” and stock prices may not reflect good earnings performance. In other words, I could be right but still fail. Dealing with multiple factors here and I need to get them all correct at the same time – Tough.

However, when it comes to dividends from a REIT, it is a different story (compared to share prices of REITs).

Jeff Bezos Emphasizes The Core Of Investment Wisdom: ‘The Stock Is Not The Company, And The Company Is Not The Stock’ — Insights From The Amazon Founder On Navigating Market Perceptions  (read here)

Yield gap narrowing: For cash-rich tech companies like the magnificent 7, this might not mean much… as compared to REITs such as Hui Xian Reit.

I am just sharing my thoughts. The yield gaps might remain wide for many many years. Please DYODD, before doing any investing.

Ultimately, what do you believe in? Are you more of a growth investor, or a true blue value investor who strongly believes that the focus is on the business fundamentals and not affected by geopolitics/government policies, the economy, interest rates, forex volatilities, etc…

Ray Dalio says now is the time to buy ‘cheap’ Chinese stocks as Beijing works to revive the economy (read here)

Thank you for reading.

 

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

 

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

 

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

 

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

 

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

 

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

 

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

Rethinking my financial targets for 2024

I was scrolling through my Instagram feeds, and noticed that some of the financial influencers are showing short posts of their financial targets for this year. Typically, it could be their targets for passive income, or new goals in savings or investment amounts for the year 2024.

First and foremost, I am all for setting New Year’s resolutions. These are goals we set for ourselves that make the most of the fresh start that the New Year brings. They are often related to examining our habits and whether they benefit us or not. For example, you may make a resolution to go on more nature walks or resolve to eat more vegetables or exercise more. This is why there is often a spike in the number visiting the gyms, running tracks, or swimming pools at the start of the year.

Hence, I thought it was good to set some sort of financial goals for myself. Well, my active income salary is sort of fixed, excluding the bonuses or variable components.

One area that I am interested in exploring is how to further increase my passive income, which comprises dividends from my stocks, interests from the bonds, and premiums from my selling options.

Background

So let’s start with a bit of the background.

For the dividends + bond interests, so far for the past few years, I have been averaging around S$500 monthly increment after each year (read here).

I have only started selling options in 2021 and have subsequently been sporadically on and off selling options. I was not that disciplined or focused when it comes to selling options. It requires more effort and time as compared to the more passive dividend investing. There are more activities in 2023, where I managed to generate income each month.

However, as you can see, the amount fluctuates… a lot.

Well, it ranges from a low of $66.60 (in May 2023) to a high of $818.95 (in Oct 2023). I was not really aiming for a consistent payout anyway and was not really disciplined in consistently selling options. Hey, it helps to cover my lunches at work during the weekdays, and on a good month, I don’t have to think twice about treating my colleagues to a round of tea/coffee at the hawker center or coffee shops.

However, I did become familiar with selling options (currently using Tiger Brokers).

Step by step guide to selling Put Options using Tiger Brokers (Desktop version) (read here)

Thoughts on the income strategy (Selling Options) (read here)

2024 ‘Targets’

So early this month (Feb 2024), I thought to myself, maybe I need to examine my habits, set aside some time, and set a financial target. I recently changed my job, however, salary-wise, there was not much increment (yet).

For dividend/interest passive income, I initially thought to aim for a target of $1000 increment per month for 2024. However, in hindsight, since I have been consistently getting an increment of $500 monthly for the past few years, I will still stick to another monthly increment of $500 for 2024 (or in total $6,000 more for the year 2024 as compared to the amount received in 2023). Well, I will still try to do my regular DCA into dividend stocks (eg. SG-listed or HK-listed stocks) and not so much into growth stocks (well at least for the US markets since valuations are rather high at the moment). Of course, there will be factors beyond my control. For instance, I was pleasantly surprised by the recent news on DBS’s proposed 1-for-10 bonus issue and higher dividend (read here); while many REITs are hit by the higher interest rates environment and currency exchange headwinds, eg. MPACT reported a lower distributable income of S$115.3 million (read here).

For option premiums, it was rather tricky. As mentioned earlier, my 2023 performance was, for lack of a better word, rather volatile. My best month’s income was more than $800 while the income for many months hovers around $100. I decided perhaps with more active actions I could aim for $800 per month.

The below (initial) bar chart is based on a $1,000 monthly increment for the dividend/interest target and a $800 monthly option premiums target.

Issues in retrospect

Well, so far, the results are encouraging for the option premiums.

As you can see below, on a month-to-month comparison basis, the premiums appear to be improving. FYI, the below amounts are all expired option premiums excluding March 2024 amount.

However, for me personally, the mentality behind selling options is a bit different from investing in dividend stocks. As much as I would like to adapt it or ‘mold’ it to conform to the passive long-term income strategy, there are many differences between the two.

Duration

For one, it is duration.

Well, I see selling options as short-term trading. Even that, in my case, it would appear long to many option traders. I typically sell options that would expire minimally 1 month (or more). My preferred period is around 1.5 months or more to get the full effect of the time value declines aka time decay, which accelerates as the expiration date gets closer. I get uncomfortable with shorter durations as I would have to enter into riskier positions to get premiums which would minimally cover the fees.

In comparison, the holding period for my dividend stocks is typically in years. For me, it is difficult to sell stocks as compared to buying stocks. In most cases, I would either hold or add more.

In addition, there are certain periods whereby I would avoid having option positions as much as possible, eg. during the FOMC meeting periods (read here) or when the underlying company announces its earnings. In the former, there is a possibility of the Fed cutting interest rates resulting in a spike in market prices (or vice versa), and in the latter, there will be unexpected volatility in share prices if earnings are not within expectations (or much better than anticipated).

Less Volatile stocks

Higher premiums are typically allocated to more volatile stocks. However, I tend to prefer more liquid and less volatile big-chip growth stocks when selling options. Eg. Alphabet, Mastercard, or Tencent, although I also sell options of Pinduoduo or Trade Desk stocks (They offer better premiums as they are more volatile; and since I am vested in their stocks…).

Sufficient stocks and cash

This is one of my biggest headaches. To generate higher premiums while adhering to the idea of longer duration and less volatile stocks, I would really need a ready (big) war chest of cash (for selling cash-secured put options) or a lot of stocks (for selling covered call options). This comes with time, and I need to slowly build this up. I only sell OTM options and not ITM options (headache thinking about the maths).

In many cases, we peg success to results. After all, we often see clickbait posts on Youtube, Instagram, and TikTok from people boasting of how much they can make per month and those who do not achieve those targets as losers.

When I was trying to generate more premiums to hit the targets, there were several things that I did. For instance, I would perhaps sell more options that expire within that month but with strike prices nearer to the current stock prices (eg. with resulting shorter durations), sell options of more volatile stocks, or sell naked options. Although, generally, the strike prices are far from the current stock prices (and may not be such a bad thing if the prices suddenly collapse or spike up all of sudden beyond the strike prices).

And yes, so in terms of results, it did indeed get better. Much better than the 2023 monthly amount, kind of like on steroids. However, more risks are involved. My original ideals of longer expiration duration options with more far-out strike prices, less volatile stock options, and having sufficient assets (cash or stocks) behind the options are sometimes disregarded.

I was actually reminded that results aren’t the true gauge of success… by a video on calisthenics workouts.

In one part of the video (fast forward to 2:00), the trainer was explaining how to do push-ups the proper way. Eg. all the way down, and all the way up with arms straightened and shoulders down, and utilizing the core and not just the upper body up.

He mentioned, that a lot of people are too overly concerned about hitting the numbers, how many push-ups, and how many repetitions, and forget about the form and posture. In the end, they did not train the right muscles, ended up injuring themselves, or did not progress to get stronger over time. The focus ought to be on the right technique, posture, and form.

Ultimately, Nobody is counting (for you).

Yup, it is something as mundane as doing a push-up correctly.

Recalibration

As mentioned at the start of the post, I believe it is important to examine our habits and set targets. Nevertheless, I also realized that targets aren’t everything. It is also important to set realistic targets, and not be too overly concerned about hitting the targets. After all, the journey is more important than the destination.

By focusing too much on the target and forgetting about the risks involved, I may end up ‘injuring’ my financial portfolios.

Moving forward, in retrospect, given the nature of option selling, the FOMC calendar, and the company earnings dates… it is difficult to achieve consistent premium amounts unless I start to take unnecessary risks. The target of $800 per month is also rather high. A more achievable and realistic target would be in the range of $200 to $400. A target that I am comfortable with.

For dividend investing, as much as I want to adhere to the DCA principle, I tend to wait when markets are overly pessimistic to add more to my positions. Let’s hope I meet my yearly target this year.

As much as I want to be proactive about it, when it comes to the stock market, many things are just beyond my control. Why rush it? When it comes to investing, being too proactive may not be a good thing.

So while the financial targets are there, they are more of a ‘guideline’.

I just changed my job, but have yet to see the full effect of the pay rise subject to the variable component/bonus payout. Nevertheless, so far, the yearly increments in passive income beat what I can achieve in active income… My assets sure ‘work’ harder than me. :p

Thank you for reading.

 

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Tiger Brokers

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Post-Pandemic, what happened to the Worst COVID-19 pandemic hit S-REITs?

I reckon we are now in a post-pandemic world. On 5 May 2023, more than three years since COVID-19 was designated as a pandemic, the World Health Organization (WHO) declared an end to the global Public Health Emergency (PHE) for COVID-19. 

I don’t know about you, but I always felt that when it comes to the stock market, crises are opportunities. Well, sometimes this may not be true, but the probability is high.

So now that we are out of the woods (pandemic-wise), what happened to these S-REITs? However, perhaps the first question would be which are these S-REITs in the first place?

Well, these days most of the attention is on the US office S-REITs.

Headwinds expected to persist for US office S-Reits despite sharp year-end rally (read here)

However, in the early part of the pandemic, in the Singapore market, hospitality REITs bore the brunt of the sell-off (followed by retail REITs). Perhaps, these are the most obvious ‘casualties’ of the lockdowns. Since we do not know how long the Covid-19 situation will persist, in the short term, the bottom lines of the hospitality sector and then the retail sector will be the initial sectors to be affected. Both the hospitality and retail REITs were literally at the epicenter of the pandemic-induced market crisis. 

Worst COVID-19 pandemic hit S-REITs and where are they now? (read here)

In 2020, for the first time, S-REITs dropped 367.98 points which translates to a huge 37.91% collapse as the FSTE REIT Index crashed from 970.62 on 19 Feb 2020 (Wed) to 602.64 on 23 March 2020 (Mon), over a period of just 22 market days. This ferocious sell-down was the worst ever in S-REIT history.

Consequently, there was a big drop in the Price to Book Ratio and a big spike in the dividend yield for the FSTE ST REIT Index during the Feb – Mar 2020 period. Please see below.

Worst performing S-REITs

Please see below for the top 9 worst-performing REITs in the 1Q2020 list, and all 5 hospitality REITs listed on the SGX (see below) were in the list.

The 5 hospitality REITs are ARA US Hospitality Trust, CapitaLand Ascott Trust, CDL Hospitality Trusts, Far East Hospitality Trust, and Frasers Hospitality Trust. 6 hospitality REITs if we include Eagle Hospitality Trust, which filed for Chapter 11 bankruptcy in the US in Jan 2021.

Note: On 27 September 2022, Ascott Residence Trust was renamed CapitaLand Ascott Trust (CLAS).

The other 3 REITS are:

• Lippo Malls Indonesia Retail Trust, a Retail REIT.
• Lendlease Global Commercial REIT is a diversified REIT with commercial and retail properties.
• ESR-LOGOS REIT, the lone Industrial REIT.

Note: Following the successful merger with ARA LOGOS Logistics Trust (ALOG) on 28 April 2022, ESR REIT was renamed ESR-LOGOS REIT (EREIT).

 

Stock Price Performance

S-REITs’ 37.91% fall on 23 March 2020 is the 2nd largest fall in S-REITs’ 19-year history since the S-REIT market started in 2002.

So where are they now from the low share price on 22 / 23 March 2020?

For comparison, during the period from 22/23 March 2020 to 23 Feb 2024, the iEdge S-REIT Index increased from 948.144 to 1,055.82, an 11.4% rise.

Note: The iEdge S-REIT Index is regarded as Singapore’s S-REIT Benchmark. It is a free-float market capitalization weighted index that measures the performance of real estate investment trusts in Singapore.

While the STI Index increased from 2,528.76 to 3,184.91, a 25.9% rise. Among the S-REITs listed above, only Far East Hospitality Trust’s share price rise is higher.

 

Distribution Per Stapled Security (DPS) Performance

As we can see, only Far East Hospitality Trust and Frasers Hospitality Trust managed to increase their DPS. For the rest of the REITs, their DPS have declined and have yet to reach the 2020 level. In particular, Lippo Malls Indonesia Retail Trust has stopped paying dividends since FY 2023, while its share price has crashed by more than 85%.

 

Latest Performance and Outlook

1) ARA US Hospitality Trust

Outlook:

In its Financial Statements And Related Announcement – Full Yearly Results issued on 22 Feb 2024, ARA H-Trust highlighted the following:

The United States (“U.S.”) lodging market continued its recovery in the last quarter of 2023. While economic sentiments have improved, concerns over a potential slowdown in Gross Domestic Product (“GDP”) growth due to the impact of elevated interest rates on business and consumer spending remains.
Lodging demand has stayed resilient and continues its recovery trajectory, supported by recent gains in group and business travel demand. The growing trend of hybrid work arrangements also contributed to an increase in “bleisure” demand, where guests extended travel days beyond weekdays to combine business and leisure travel.
While occupancy rates have yet to fully return to pre-pandemic levels due to lagging business travel demand, strong average daily room rate (“ADR”) growth has boosted revenue per available room (“RevPAR”) growth. In FY 2023, ARA H-Trust’s portfolio recorded an average occupancy rate and ADR of 69.3% and US$138, respectively, achieving a RevPAR of US$96 for the year.
Mr. Lee Jin Yong, CEO of the Managers said, “Amidst the challenges posed by the impact of elevated interest rates, economic uncertainties, and geopolitical tensions, our well-diversified portfolio of upscale, select service hotels have continued to demonstrate resilience on the back of proactive portfolio management. Riding on the tailwinds of the recovery of the U.S. lodging sector, we are pleased to report that we have outperformed year-on-year across all key performance indicators in 2023 and continue to deliver healthy returns to all Stapled Securityholders. Since there is no immediate refinancing risk, we plan to focus on organic growth through hands-on asset management, portfolio optimization, and disciplined capital deployment.”

 

2) CapitaLand Ascott Trust

Outlook:

Extract below from its 2023 Full Year Unaudited Financial Statements issued on 29 January 2024:

Mr Bob Tan, Chairman of CapitaLand Ascott Trust Management Limited and CapitaLand Ascott Business Trust Management Pte. Ltd. (the Managers of CLAS), said: “CLAS continued to deliver strong performance. Our balanced portfolio of stable and growth income streams enables CLAS to capture growth opportunities while remaining resilient amidst uncertainties.

As part of CLAS’ active portfolio reconstitution strategy, we completed 18 yield-accretive acquisitions in the past two years, boosting CLAS’ income. In the last seven months, we also announced the divestment of nine mature properties4 at a premium to book value. Our strengthened financial position will enable us to redeploy capital towards more optimal uses such as investments into higher-yielding assets, funding our asset enhancement initiatives (AEI) or paring down debt. We remain committed to delivering sustainable returns to Stapled Securityholders.”

Ms Serena Teo, Chief Executive Officer of the Managers of CLAS, said: “Through our active portfolio reconstitution and AEI, we are enhancing the quality of our portfolio to create further value for Stapled Securityholders. We have eight properties undergoing or will undergo AEI. The AEI is expected to uplift the value of the properties post completion. Looking ahead, the diversification of CLAS’ portfolio across geographies, lodging asset classes and contract types will continue to provide income stability.”

 

3) CDL Hospitality Trusts

Outlook:

Extract below from its Press Release issued on 30 January 2024, titled “CDL Hospitality Trusts Registers 1.2% YoY Increase In DPS To 5.70 Cents For FY 2023“:

Mr Vincent Yeo, Chief Executive Officer of CDLHT’s managers, said, “While international travellers from China have yet to fully return, global travel continued to recover in 2023. In Singapore, our core market, the hospitality sector witnessed remarkable growth in the first three quarters of 2023, building on the momentum of the strong rebound in 2022. In the final quarter, the pent-up demand that fuelled the industry’s resurgence began to normalise, in contrast to the fervour experienced in 2022.”
Over the past year, the Managers have implemented asset enhancement initiatives to augment its hotels’ competitive standing in the respective markets. In 3Q 2023, enhancements to W Hotel’s ballroom, lobby and restaurant were completed, elevating guest experience and reinforcing the hotel’s positioning as a leading luxury hotel in Sentosa. At Grand Copthorne Waterfront Hotel, an extensive enhancement of meeting facilities and full renovation of 549 rooms were completed in July 2023 and August 2023 respectively. In addition, at Grand Millennium Auckland, a refurbishment of the all-day dining restaurant and the lobby lounge was completed in November 2023 and December 2023 respectively. Works are also commencing for Grand Millennium Auckland’s ballroom renovation, which will be completed in phases.
Mr Yeo added, “In a year where acquisitions were difficult because of high borrowing costs, we executed strategic asset enhancement opportunities to fortify the competitive edge of our hotels, positioning them for continued success.”

 

4) Far East Hospitality Trust

Outlook:

Extract below from its Press Release issued on 14 February 2024, titled “Far East Hospitality Trust Achieves 27.3% Growth In Income Available For Distribution For FY 2023“:

In 2023, international tourism recovered to 88%5 of pre-pandemic levels. In Singapore, visitor arrivals reached 71% of pre-pandemic levels. For 2024, the United Nations Tourism (“UN Tourism”) expects a full recovery of international tourism, supported by remaining pent-up demand, increased air connectivity and a stronger recovery of Asian markets and destinations. For Singapore, STB expects 15 million to 16 million visitor arrivals by the end of 2024. While lower than 2019, it still represents an increase from the 13.6 million arrivals recorded in 2023.
Economic growth in 2024 is expected to drive the recovery in travel and hospitality, especially in corporate travel. Global economic growth for 2024 is projected to reach 3.1%, while China and the ASEAN-5 (Indonesia, Malaysia, Philippines, Singapore, Thailand) region are also expected to grow at a higher rate of 4.6%7 and 4.7% respectively. The International Monetary Fund also expects the Federal Reserve, the European Central Bank and the Bank of England to hold policy rates steady until the second half of the year.
Notwithstanding the above, recovery may be moderated by geopolitical tensions and a slower rebound in visitor arrivals from some key markets. In addition, leisure inbound into Singapore may also be affected by the relative strength of the Singapore dollar.
In summary, the REIT Manager remains optimistic for the year ahead, underpinned by a healthy pipeline of MICE (Meetings, incentives, conferences and exhibitions) events, large-scale performances, and positive policy changes such as further expansion of air services into Singapore and the 30-day visa-waiver for Chinese travellers (Singapore’s largest source market of tourists in 2019).

 

5) Frasers Hospitality Trust

Outlook:

Extract from the Minutes of the Annual General Meeting of Frasers Hospitality Trust issued on 22 Feb 2024:

Firstly, the CEO emphasised that the Managers would continue to pursue a growth strategy encompassing both organic and inorganic growth. Referring to his Presentation, the CEO highlighted that FHT has been undertaking organic growth strategies and initiatives, and the Managers intend to continue doing this moving forward. The CEO noted that the asset management team would continue to work with property operators to run operations more effectively and efficiently and continuously look out for opportunities to further enhance and create value within the existing portfolio for FHT, such as through asset enhancement initiatives (“AEIs”) to further improve its assets’ operating performance in the future. In relation to inorganic growth, the CEO noted that the current interest rate environment may not be conducive, with the exception of Japan which is a location the Managers are interested to explore due to the relatively good asset yield spread in comparison to the cost of borrowing. The CEO emphasized however, that the Managers remain judicious in how to best utilise FHT’s limited resources.

Secondly, the CEO noted that capital is required for inorganic growth and one option would be to recycle capital by maximising and optimising the valuations of all existing properties in FHT’s portfolio (for example, through AEIs) so that the properties can be sold at an optimum price when the right opportunity arises. While the CEO also noted that equity fund raising would be a good option to support inorganic growth, the current market environment and trading price of the Stapled Securities might not be conducive for fund raising. The CEO acknowledged the concerns raised by the Stapled Securityholder in his/her question that FHT was trading at a discount of approximately 20% of
its net asset value (“NAV”) per Stapled Security and observed that, on a comparable basis as of 30 September 2023, all other hospitality S-REITs1 were trading at a discount to NAV of between 10% and 60%. Having said that, the CEO referred Stapled Securityholders to a recent Business Times article2 and highlighted that FHT was ranked amongst the top five S-REITs and delivered total returns of 16.9% for 2023. The CEO assured Stapled Securityholders that the Managers will continue to do their best.

The Chairman also informed Stapled Securityholders that the new Board members have raised questions and conducted strategic reviews of the markets that are core to FHT. The Chairman commented that as there are many uncertainties in the global economy, the Managers will remain cautious and will seek ways to protect the value of FHT’s assets and scale up FHT’s portfolio.
While it remains difficult for the Managers to raise capital, the Chairman informed Stapled Securityholders that the Managers will explore opportunities to bring the right benefits to Stapled Securityholders

 

6) Lippo Malls Indonesia Retail Trust

3Q 2023 Results Presentation

Extract below from its Press Release issued on 23 November 2023, titled “LMIR Trust reports stable 3Q 2023 NPI of S$30.6 million despite ongoing macroeconomic challenges“:

October’s inflation rate in Indonesia inched up to 2.56% from September’s inflation rate of 2.28%. This was largely driven by El Nino weather conditions that has triggered an increase in food prices. Meanwhile, core inflation continued to ease to 1.98% from 2.00% in the previous month, marking the lowest figure in 21 consecutive months.

Despite some easing in inflation, the Indonesian Rupiah (“IDR”) continued to weaken to its lowest level at 15,871 against the US dollar since 2020. This triggered the raising of its key rate by 25 basis points to 6.00% by Bank Indonesia (“BI”) to strengthen stabilisation measures for the currency against the impact of increasing global uncertainty. The key rate is now at its highest level since June 2019. Further weakness in the IDR may trigger more rate hikes. Nevertheless, Indonesia’s economic growth forecast remains at 4.5% to 5.3% for 2023.

 

7) Lendlease Global Commercial REIT

Outlook:

Extract below from the article titled: “Lendlease Global Commercial REIT (LREIT SP) – Growing
Through a Sustainable Global Lens” dated 22 January 2024:

The overall Singapore commercial retail market has made a strong postpandemic recovery, driven by domestic demand and a recovery in tourism, with 12.4m tourist arrivals by the end of November and is expected to reach 13m by year-end but still well below the 2019 peak of 19m. New occupier demand has come from new-to-market brands and existing brands building more physical stores. Areas of strong demand include F&B, Athleisure apparel, and luxury retail. There was a tight supply situation in 3Q2023 with vacancy rates continuing to fall with the closure of JCube with the rejuvenation of projects and tourism driving occupier demand along with more workforce footfall, with more conferences, and exhibitions.

 

8) ESR-LOGOS REIT

Outlook:

Extract below from the article titled: “ESR-LOGOS REIT Delivers FY2023 DPU of 2.564 Cents; FY2023 Revenue & NPI Grew 12.6% and 11.8% Respectively; Well Positioned for Growth with Low Gearing“:

Mr. Adrian Chui, Chief Executive Officer and Executive Director of the Manager. (ESR-LOGOS Funds Management (S) Limited, as manager of ESRLOGOS REIT (the “Manager”)).

Mr. Adrian Chui added, “Entering FY2024 with a robust balance sheet, the timing of the anticipated interest rate cuts augurs well for both distribution and NAV growth potential. Despite the challenges posed by inflation on property expenses, E-LOG remains resilient, with c.90% of its utility costs on a pass-through basis, ensuring proactive management of inflationary pressures. The successful initiatives undertaken in FY2023 to Recapitalise via the equity fund raising, Recycle via the divestment of non-core assets and Rejuvenate via AEIs and redevelopments, have fortified our balance sheet and portfolio, and we now stand well positioned to capture growth opportunities amidst the stabilising interest rate environment.”

 

In gist

Clearly, many of these REITs are not out of the woods yet. Their share price performance is still lagging that of the STI Index and DPS has not recovered back to the 2020 level. With less risky and relatively high-yield products available (bonds, T-bills, fixed deposits, etc) and the persistently high-interest rates, it might not be any time soon.

 

Thank you for reading.

 

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When it is nice to read earning reports again…

I don’t know about you, I know it is important to keep up to date on the companies, in which I am invested. However, sometimes I am just too busy or just too lazy to read them. They aren’t the most interesting ‘literature’ available, and more often I will just glance through the financial highlights.

Well, in lieu of the ‘dull’ earning reports, there is always Netflix, Prime,  Disney+ or YouTube.

In addition, the past couple of years have not been kind to many companies, as the pandemic affected them negatively. So it can be rather disheartening to read through the long list of woes and cautious outlooks. Perhaps it is my mind mentally avoiding all the negative information… which is why I having been reading these reports as much.

In my previous post (see below), I mentioned about two stocks in my portfolio that have improving outlooks or earnings. Namely, CapitaLand Ascott Trust & Straco Corporation Ltd.

“Recovery” stocks in my portfolio – Will the rainbow finally be here? (read here)

While going through the other companies’ filings which I am vested in, it is good to know that more companies are starting to turn the corner after years of declining profits. Of course, there are other solid companies that continue to do well (very well)… eg. Mastercard, Alphabet, DBS, and ParkwayLife Reit….to name a few.

For the former group, although their earnings have started to improve, it appears that the stock prices have yet to ‘catch’ up. Then again, the stock is not the company and it might finally reflect the value after the long term. It can be argued that these are not the top-tier growth stocks, but I do believe they have their strengths. I have a substantial percentage of my portfolio in Hong Kong-listed stocks and quite a number of these stocks are Hong Kong-listed.

PDD Holdings Inc

I find PDD’s earnings rather erratic (esp. for the free cash flow). See below. Still, I can see it is improving overall (eg. EPS).

After the terrible earnings report in Q12022, earnings seem to be getting better. Its shopping app continues gaining in popularity while China continues to shed more light on its potential stimulus plans, which may have “big impact. PDD’s Temu app has pretty much gone viral in the U.S. Indeed, consumer appetite for incredibly low-cost discretionary goods could stay strong as inflation and macro headwinds continue to impair our ability to spend on nice-to-have goods. 

For 3Q2023:

1) Total revenues in the quarter were RMB68,840.4 million (US$19,435.4 million), an increase of 94% from RMB35,504.3 million in the same quarter of 2022.
2) Operating profit in the quarter was RMB16,656.0 million (US$2,282.9 million), an increase of 60% from RMB10,436.6 million in the same quarter of 2022.
3) Net income attributable to ordinary shareholders in the quarter was RMB15,537.1 million (US$2,129.5 million), an increase of 47% from RMB10,588.6 million in the same quarter of 2022.

The share price is up almost 320% from the lows in March 2022. Its P/E Ratio at 30.79 is rathe high though. Well, the earnings is much better compared to Alibaba’s recent earnings (and Tencent March 2023 earnings).

Lam Soon (Hong Kong) Ltd

The EPS chart of Lam Soon has not been pretty. See below.

Annual profit has been trending down since 2019.

As stated by the Chairman in its 2023 Annual Report (emphasis mine): “FY22/23 marked a challenging year for the Group, as the negative impact of global geopolitical tensions and Covid-19 policies in our core markets reverberated across all of our businesses. Despite the diversified nature of our Group, we were not completely immune to raw material cost pressures and dampened market demand.
The Group posted a profit of HK$85 million against revenues of HK$5,119 million during the financial year, representing declines of 67% and 16% respectively against last year.“

However, there has been an uptick in the free cash flow in the recent quarter.

In addition, the company made an announcement on 2 Feb 2024 titled “POSITIVE PROFIT ALERT“, and to quote (emphasis mine):

“The Board of Directors (the “Board”) of the Company wishes to inform the shareholders of the Company and potential investors that, based on the preliminary review of the unaudited consolidated management accounts of the Group for the six months ended 31 December 2023 and the information currently available to the Board, the Group is expected to record a net profit in a range of approximately HK$120 million to HK$140 million for the six months ended 31 December 2023, as compared to the net profit of HK$42 million for the previous corresponding period.
The increase in net profit for the six months ended 31 December 2023 as compared to the previous corresponding period was mainly attributable to favourable wheat costs and edible oil raw material costs resulting from stabilised global supply, and sales volume growth and product mix improvement.
The Company is still in the process of finalising its interim results for the six months ended 31 December 2023.”

The share price has been beaten down over the years and has only slightly improved. It is down more than 46% from the Nov 2021 level.

Link Real Estate Investment Trust

In its 1H 2023/2024 Interim Presentation in Nov 2023, revenue and NPI have increased YOY while gearning is down YOY.

For the Hong Kong Retail segment, it has maintained 98% occupancy and achieved 8.7% rental reversion. The average unit rent has also surpassed pre-Covid level.

The Hong Kong Car Parks and Related Business segment, revenue is up 5.2% YOY, income is up 5.3% YOY.

Its investment in Singapore Retail has 99.3% occupancy.

Australia Retail has 98.1% occupancy.

Other segments like International Office, Mainland China Retail, Mainland China Logistics are also recovering and doing well.

The share price is still depressed, down almost 50% from its June 2021 level.

Well, I am still slowly reading up on some of the other earning reports of the companies which I am vested in. It is a welcome change for some when situations start getting better.

Trade Desk

Fourth Quarter and Fiscal Year 2023 Financial Results

Jeff Green, founder and CEO of The Trade Desk (emphasis mine): “Once again The Trade Desk outpaced nearly all areas of digital advertising in 2023, with $1.95 billion of revenue representing 23% growth year over year and a record $9.6 billion of spend on our platform. At the same time, we continue to generate significant profitability and cash flow, which allows us to remain at the bleeding edge of our industry, with innovations such as Kokai. Our results are testament to the growing value that advertisers are placing on the open internet versus the limitations of walled gardens,”

Financial Guidance:

First Quarter 2024 outlook summary:

• Revenue at least $478 million
• Adjusted EBITDA of approximately $130 million

Trade Desk Jumps As Internet TV Drives Strong Revenue Outlook (read here)

The share price is up almost 100% form the Dec 2022 level. However, with a P/E ratio of almost 302$ it maybe too expensive for me.

Thank you for reading.

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

“Recovery” stocks in my portfolio – Will the rainbow finally be here?

I am not really into comeback/recovery stocks. However, I reckon this month will probably be the month whereby I think more into some of these recovery stocks. 2 of these being in my dividend portfolio, namely CapitaLand Ascott Trust (SGX: HMN) and Straco Corporation Ltd (SGX: S85).

These ‘recovery’ stocks are not new, and I have been occasionally adding to my positions in these 2 stocks. Nevertheless, their growth stories in recent months have gotten better with the world in general recovering from the past pandemic. In short, their stories just keep getting better.

CapitaLand Ascott Trust

On 29 January 2024, in its 2H / FY 2023 Financial Results update, the following was reported:

• 1) DPS increased 16% y-o-y in FY 2023 (Excluding one-off items, adjusted DPS increased 14% y-o-y);
• 2) Revenue per Available Unit (RevPAU) rose 23% y-o-y in FY 2023 to pre-Covid levels.

Financial and liquidity position:

• 1) Healthy gearing of 37.9%;
• 2) Low average cost of debt of 2.4% p.a.;
• 3) 81% of total debt on fixed rates;
• 4) Robust interest cover of 4.0X

FY2023 results (see below):

FY2019 results (see below):

In comparison to FY2019 financial results which were prior to the pandemic, for FY2023, the revenue, gross profit, and total distribution all have improved.

However, there is room for improvement. For instance the all important DPS (Distribution per Stapled Security) has not recovered to FY2019’s level. Gearing has increased from 33.6% to 37.9%. The average cost of debt increased from from 2% p.a. to 2.4% p.a., but is still low. Weighted average debt to maturity increased from 3.4 years to 3.7 years which is good in this high interest rate environment, with 81% of total debt on fixed rates (86% in FY 2019).

• Revenue:
• FY2023: S$744.5 mil
• FY2019: S$514.9 mil

• Gross Profit:
• FY2023: S$338.2 mil
• FY2019: S$252.6 mil

• Total Distribution:
• FY2023: S$237.0 mil
• FY2019: S$165.6 mil

• DPS (Distribution per Stapled Security):
• FY2023: 6.57 cents
• FY2019: 7.61 cents

• Gearing:
• FY2023: 37.9%
• FY2019: 33.6%

In the news release dated 29 Jan 2024 (emphasis mine), management stated that the total distribution for FY 2023 rose 25% y-o-y to S$237.0 million. The rise was due to stronger operating performance and contributions from 18 new acquisitions. CapitaLand Ascott Trust (CLAS) properties saw strong demand as international travel continued to recover. CLAS’ revenue per available unit (REVPAU2) in 2H 2023 reached 103% of pre-pandemic levels in 2H 2019 on a pro forma basis, increasing by 10% y-o-y to S$157. REVPAU also rose 23% y-o-y to S$148 for FY 2023. In 4Q 2023, majority of CLAS’ key markets such as China, Japan, United States of America (USA) and Vietnam also registered y-o-y REVPAU growth...

CLAS achieved a fair value gain of S$156 million, about 2% increase in portfolio valuation due to stronger operating performance and outlook for its portfolio despite higher capitalisation rates and discount rates….

Ms Serena Teo, Chief Executive Officer of the Managers of CLAS, said: “Through our active portfolio reconstitution and AEI, we are enhancing the quality of our portfolio to create further value for Stapled Securityholders. We have eight properties undergoing or will undergo AEI.
The AEI is expected to uplift the value of the properties post completion. Looking ahead, the diversification of CLAS’ portfolio across geographies, lodging asset classes and contract types will continue to provide income stability.”

Stock Price performance (see below):

Although the stock price is currently above the lows in April 2020 (around 25%), the stock price has been pretty much range-bound ever since. The 52-week price range is 0.8400 – 1.1300.

The current dividend yield is at 7.03%, with Price/Book ratio at 0.81.

In Aug 2023, CapitaLand Ascott Trust (CLAS) announced a preferential offering that offered unitholders the right to buy 29 new units for every 1,000 units held, at S$1.025 each.

The theoretical ex-price after the placement, preferential offering, and distributions is between S$1.01407 to S$1.01467 per unit. 

In retrospect, as CLAS’ share price has mostly been trading below this level since Sept 2023, CLAS’ unitholders who were interested in buying additional units then would be better off by just purchasing the shares from the market rather than subscribing to the PO at S$1.025 per unit. 

CapitaLand Ascott Trust’s private placement priced at $1.043, preferential offering at $1.025 apiece (read here)

Straco Corporation Ltd

On 9 Feb 2024, the company issued a Profit Guidance for The Full Year Ended 31 December 2023. It stated that (emphasis mine) based on the preliminary review of the unaudited financial results of the Group for FY2023, the Group is expected to report a substantial net profit for FY2023 due to an overall improvement in business operations as compared to the net loss reported for the corresponding period ended 31 December 2022 (“FY2022”), due mainly to the following reasons:

1) Increase in revenue from the Group’s China attractions in FY2023 as visitor numbers surged following the easing of strict Covid-19 measures since early December 2022 and domestic tourism recovered strongly and continued its advance towards pre-Covid levels.
In comparison, prolonged closures and intermittent lockdowns arising from the zero-Covid policy in FY2022 severely impacted visitor numbers and normal operations;

2) Increase in revenue from Singapore Flyer arising from higher visitor numbers as international tourist arrivals recovered strongly and ride operations gradually resumed to its normal operating hours. In comparison, ride operations were suspended for three months due to a technical issue in FY2022; and

3) Lower exchange losses recorded in FY2023 compared to exchange losses of $5.37 million recorded in FY2022.

FY 2022 has been a very bad year (see below). The company reported a net loss of $10.8 mil, while EPS was negative 1.26 cents.

In the FY2022 annual report, the Chairman highlighted that (emphasis mine) 2022 was to be the final but most challenging year of the pandemic for Straco, as China’s zero-Covid policy precipitated a sharp fall in revenue for our attractions from the preceding year. In Singapore, the gradual easing of Covid measures kick-started our tourism recovery and visitor numbers in Singapore – although the government’s transition to a post-Covid phase also meant the withdrawal of financial support in the form of job support schemes and tourism vouchers. Other factors would be due to the one-off arbitration award to the Group in 2021, as well as exchange losses as the Chinese yuan weakened against the Singapore dollar in the year. For the year ended 31 December 2022, the Group registered net losses of $10.81 million, including exchange losses of $5.37 million; while net operating cash outflow was $2.99 million.

It is worth noting that the group paid out a first and final dividend of S$0.01 in 2022 despite incurring a net loss of S$10.8 million as the pandemic led to the temporary closure of its attractions in China and Singapore.

Based on the past (year) performance and the recent good news in the form of the Profit Guidance in Feb 2024, it appears that Straco is finally beginning to turn the corner.

In comparison, the FY2022 results are way off from the FY2019 results which was before the pandemic (see below). Hence, if we use FY2019 results as a benchmark, it has a lot of grounds to cover. Or to put it in another way, if FY2022 was the base, it is a low base to start off with if FY2019 was the norm.

In fact, for its 3Q 2023 business update, Straco reported that revenue for 9M 2023 more than tripled year on year to S$67.5 million as tourists came flocking back to its attractions. People would probably be expecting the momentum to continue for the full year.

• Revenue:
• FY2022: S$28.2 mil
• FY2019: S$108.8 mil

• Attributable Net Profit:
• FY2022: (S$10.8) mil
• FY2019: S$38 mil

• EPS:
• FY2022: (1.26) cents
• FY2019: 4.41 cents

Stock Price performance:

Although the stock price is currently above the lows in March 2020 (around 16%), the stock price has been pretty much range-bound ever since. The 52-week price range is 0.4000 – 0.5250.

The current dividend yield is at 2.15%, with Price/Book ratio at 1.63.

However, if earnings increase, it is likely that dividend payout will also increase.

However, it is worth mentioning that since the Profit Guidance announced on 9 Feb 2024, the stock price has already increased by approximately 10% to its price today (13 Feb 2024).

In gist.

I have the above-mentioned 2 stocks in my dividend portfolio for the longest time and have been patiently waiting for their recovery. While the world slowly recovers from the pandemic, the actual recovery for the businesses of these 2 companies has not been smooth, eg. increasing interest rates, forex losses, withdrawal of financial supports, slow recovery of tourist numbers, etc…

Will we see better days soon? Your guess is as good as mine.

• CAPITALAND ASCOTT TRUST POSTS 25% DISTRIBUTION JUMP FOR 2023 (read here)
• CapitaLand Ascott Trust increased FY 2023 Distribution per Stapled Security by 16% through stronger operating performance and new acquisitions (read here)
• 7 Singapore Companies That Could Increase Their Dividends in 2024 (read here)
• Straco Corporation expects a ‘substantial’ net profit for FY2023 (read here)

Thank you for reading.

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.

Wealth + Health + Family

I always thought there are more aspects to life than just wealth. The same principles of patience, perseverance/consistency, and positivity can also be applied to the other aspects of my life.

Wealth

Typically before Chinese New Year, I would be low on cash. Basically, this is the time whereby I prepare to give out red packets to my children, nieces and nephews, relatives’ kids, and even my younger brother who is single. I also did a one-time cash transfer to my parents’ CPF retirement account (before the end of the year 2023).

Given the lackluster market performance in my Singapore and Hong Kong stock portfolios, I am also not particularly feeling the flush of ‘unrealized’ profits. In fact, so far, this will probably be the first year so far that the overall value of my portfolio dropped below last year’s overall value. Still, markets are volatile.. numb to that.

Dividend portfolio: Right now, the current yield for my portfolio stands at 5.06%. My recent stock purchases in Jan 2024 are CK Asset Holdings Ltd, Link Reit, and Mapletree Logistics Trust. The alerts I have set up in StocksCafe have recently been triggered rather frequently with regards to Sun Hung Kai Properties stock; its stock prices have been reaching new lows. Nevertheless, I shall have to miss this one out. Low on cash at the moment as mentioned earlier..

Based on the recent earning announcements by some of the S-Reits, year-on-year DPU performances are not good (generally decreasing). Am also worried about the dropping NAV as well. Nevertheless, solid Reits such as ParkwayLife Reit still shine.

Selling Call and Put options: All the positions that I have sold to close in Jan 2024, before the Fed Reserve announcement at the end of Jan 2024 (which was to Hold Interest Rates Steady) has expired and I have to keep all the premiums. I have started to slowly sell more options which are to expire before the next Fed Reserve announcement on 19-20 March 2024 (and also before the company’s earning announcement). The premiums are not much – a few hundred at best, but I would like to slowly snowball these. I typically sell the options for Hong Kong-listed stocks during my WFH days and selling US-listed stock options are my occasional nighttime activities before I sleep. Somehow, I felt like I was selling insurance when I was selling these options :p.

Health

In my current job, I have 2 work from home days. Also every weekday morning I will send my daughter to school after breakfast and before starting my day at work.

After sending her to work, I will have some time to myself. It is great when my workplace is nearby so I do not have to waste time traveling to work. Instead of lazing around, I try to do some exercise. So far I have been trying to set up a routine to do a 20 to 30-minute full-body workout at home before showering and going to work. In addition to that, I try to swim 3 times a week (depending on the weather) and do some workouts after the swim.

Beyond the exercises, I have also been watching more on what I eat. Breakfast typically consists of either steamed sweet potatoes with avocado and half-boiled eggs when I am working from home (WFH), or overnight oats with chia seeds/flax seeds/sunflower seeds/walnut/almond (all ground to powder and mixed with the rolled oats and soaked in water overnight) with an avocado and half boiled eggs when I am not working from home.

In the office, my morning drink will typically be a cup of hot matcha. Lunch will be with my colleagues at the nearby hawker center or coffee shop (typically cai png or some soup-based meals).

Read somewhere that health is dependent on 70% of what we eat and 30% on exercise. I guess having adequate sleep is also important, Beyond eating well, it is also important to cut down / eliminate what is bad for us eg. processed food, trans-fat, added sugar, fried food, red meat, dairy, carbo (bread/white rice)…

In addition, I have been keeping to my nighttime routine of retinol, vitamin C serum, and glycolic acid (alternate nights)for my face before I sleep. In the morning, I will always apply moisturizer and sunblock. Think the complexion is getting slightly better. Having some purging (small break-outs) due to these acids/serum. Need a longer time to truly see any big changes. Anyway, I have had the worst complexion for the longest time, so I guess nothing to lose hahahahaha….

These days my Facebook Reels are filled with workout moves to train the abs, the right ways to do push-ups or pull-ups, etc. It is like the self-reinforcing algorithm… Anyway, I am not aiming for big muscles or 6/8 packs (no time and energy to upkeep it anyway). I am just aiming for a trim and lean body, and to have more energy.

So far, for the night sessions, I have been doing a minimum of 60 leg raises (up from 180 degrees to vertical with my lower body & legs up supported by my shoulders), a minimum of 30 Russian twists, a minimum of 60 push-ups, a minimum of 6 pull-ups or chin-ups (with hands facing forward or backward), and a minimum of 5 pull-ups with arms by the sides/hands facing inwards. I am aiming to do a minimum of 10 pull-ups. Using only body weight, and I did not use any other weights/dumbbells. So far this is what I can do in one session, some days will be fewer reps, depending on my mood/body.

One thing I learned from this initial stage of exercising is that it teaches us how to view the situation we are in. Typically, we can’t change the situation we are in, but we can change how we view it (eg, to view it positively). For every set of exercises – let’s say I want to train my abs, the first few days will be the worst… but if I try to do it even once or twice a week, I will slowly get better. (same for my work). There will be days when I really suck, despite the consistency… that is just how my body is… there are days my body just aches, but I reckon over the very long term, I should see some results (our muscles heal and become stronger).

Family

It is great to be able to send my daughter to school every morning. She just started primary one. Giving her a kiss on the head, a pat on the back, and saying goodbye early in the morning.

My evening routine includes packing her bag for the next school day. Recently she went for a Covid jab and fell ill after the jab.

My son has been doing better in his studies. Hope he keeps it up.

Recently my wife had a body checkup (sponsored by her company I reckon) and seems that she is a bit overweight. She just recently signed up in a boutique gym and engaged a personal trainer. Initially, her sessions were twice a week, however, thinks her body ached too much after the session, so she requested it to be reduced to once a week (perhaps to build it up slowly). She recently lost 200g over a week.

The family expenses have increased this year. Partly due to the inflation / GST increase here, and more because my daughter has swimming lessons and English phonics tuition; and well, in general, increases in tuition fees year on year for the existing tuitions (for my son). In gist, increase in contribution to the household fund. It is times like this when I am really grateful for the dividend income (and the occasional profits from my options positions), and of course, my job income.

Thank you for reading.

Webull

Sign up for a Webull account via my referral link and get up to $2,500 worth of Tesla shares.

StocksCafe

FYI I find StocksCafe useful for the tracking of my own portfolio, and I especially like to use it to track my portfolio stock dividend/bond interest payouts (projected and due). You can use my referral code: apenquotes. Just click here. Upon signing up using the referral code, you will get to enjoy being a Trial Global Friend of StocksCafe and test out all features for free for one month!

Please follow me at StocksCafe, via my StocksCafe profile page.

Tiger Brokers

For the Singapore market, Tiger Brokers currently waive the minimum fee and only charge a 0.08% trading fee. This drastically reduces your cost as the minimum fee from other brokers (ranging from SGD 8 such as FSMOne and SCB, to SGD 25 for local brokerages) does add up and can eat into your returns.

Tiger Broker Referral Code:: GPE59H

I would like to invite you to start investing with Tiger Brokers so you can claim your welcome bundle.

Sign up here.

FSMOne.com

Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).

If you do not have an account, you can sign up here. Please use my FSMOne referral code: P0031127, when you sign up.

Wise Card

Traveling overseas? The Wise card lets you spend money around the world with low conversion fees and zero transaction fees. Please use my referral link to sign up for one.

Shopee

I have been using Shopee for a while and think you will like it as much as I do.

Get $10.00 off your first purchase using my code DARREB52.
Download Shopee now and enjoy hot deals at the best prices! Click here.

Happy shopping!

Gemini

As stated by MoneySmart on Jan 22, if you’re looking to optimise trading your crypto with relatively low fees, simple-to-grasp expert UI and ease of purchase with Singapore dollars. then the best crypto exchange in Singapore is Gemini,

If you do not have an account, you can sign up here using my referral link. After you have signed up, once you buy or sell US$100 or more (or 100 USD equivalent of your domestic currency) within 30 days of creating your account, your account will be credited US$10 (or 10 USD equivalent of your domestic currency) worth of bitcoin.