Just some updates on my portfolio.
I have not been very active in investing so far this year. Nevertheless, I have been an avid reader of news, while at the same time doing some minor adjustments to my portfolio.
I guess sometimes, the best thing to do, is to do nothing.
If there are no opportunities to my liking, it is best to just wait it out.
The little Snowball of Dividend income
I find StocksCafe very useful in tracking dividend income, given that I have many counters, which can get too tedious and confusing to track. If you have not signed up for an account, you can use my referral code: apenquotes, to sign up. 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
You can also follow me at StocksCafe, via my StocksCafe profile page.
I am anticipating around $3,283 dividend/interest for the month of Sept 2022.
Overall, the projected monthly dividend for the year 2022 would be around $2,500+. It is an improvement of around $500 from last year’s monthly figure.
I guess that is my way of giving myself a ‘raise’ hahaha…It is tough waiting for any chance of pay increment (from active income) these days.
Recently, I purchased the Sept 2022 Singapore Saving bonds, International Housewares Retail Co Ltd (1373.HK), ST Engineering (S63.SI) and Hong Leong Finance (S41.SI).
I have been setting price alerts using StocksCafe, for stocks that I am looking to add more into. (Eg. been setting lower and lower prices).
‘Tools’ I used to track my dividend & bond interest income (read here)
Step by Step guide on how to screen for SG Reits with low debt/equity ratios, high interest coverages, and high dividend yields using StocksCafe (read here)
Income from selling Options
Given the relatively depressed market sentiments and side-way price movements, I have also sold a small number of covered call options recently using my growth stocks holdings, namely Alphabet, Pinduoduo and Tencent. So far results have been alright. However, I would fall short of calling them passive incomes.
Personally, I would consider myself an ad-hoc recreational option seller. I do not regularly sell options, and probably have not set up a routine (or made it into a habit yet)… shall see.
No doubt, given that the majority of options expire worthless (70% to 80%), selling options might appear to be a high probability way of generating some small premiums on the side. However, there is always the possibility of the options being assigned.
The recent sudden upswing in Pinduoduo share prices (eg. approx 20%) in one day, due to their stellar quarterly results is one such example. The stock price almost reached the strike price for my covered call option prior to the expiration date. The worst case is that the option get assigned and I would have to re-purchase my holdings (or sell cash secured puts), hopefully at a lower price. In retrospect, among the growth stocks in my portfolio, only Pinduoduo registered significant gains in Aug 2022.
Lesson learnt: Ensure earning announcement date do not fall within option duration.
Still, these are typically small bets with far-out strike prices, which do not set the adrenaline pumping. Slow way of getting some side cash. No chance of striking big… but I guess that this is the nature of writing covered call (or cash secured put) stock options unless one venture into futures options which I do not intend to. I prefer to keep it slow and simple.
Actually, from a long-term perspective, a falling market is not really a bad thing. I reckon if I do hold companies with strong fundamentals, eventually, stock prices will recover (well at least to their intrinsic values). It might actually be a good opportunity to load up on more shares of my current holdings. Well at least to make them into lots of 100 shares (for my growth stock holdings), so as to facilitate the selling of covered calls. After all, I do have more stocks than I have cash relatively speaking, hence the preference for selling covered calls over cash secured puts.
I reckon with more cash or more stock holdings, I would be able to sell more lots (of options) with more far-out strike prices, hence increasing the premiums while reducing the risks. Essentially using the time (decay) on my side and high probability to my advantage. This would take time… nothing hard and fast. I reckon this would only appeal to certain types of investors.
I don’t typically track the Options which I have sold. As I have mentioned earlier, I do not really perceive them as steady passive incomes, more like bets (playing with odds). For the month of Aug 2022, I reckon I received around SGD 102 of premium (yeah.. small amount).
For selling Options, I use Tiger Brokers. If you intend to sign up for an account, you can use my referral code.
Tiger Broker Referral Code:: GPE59H
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Step by step guide to selling Put Options using Tiger Brokers (Desktop version) (read here)
Singapore Saving Bonds
As mentioned earlier, I kind of lumped the bond interest together with my dividend income.
Nevertheless, I am glad to have some dry powder on the side, which is yielding some interest as well. These can be liquidated into cash for deployment into stocks when opportunities come knocking.
I always felt that the concept of having a substantial warchest in the overall investment strategy is somewhat underrated. I reckon it is because it is often referred to as being held in cash (earning little or no interest). Hence, SSB is a welcome relief.
It is good that I can also track their interest payout (actual and projected) in StocksCafe.
Alternatively, I can head to MAS website for Singapore Saving Bonds to track my holdings. The rising interest rates make these bonds more attractive, although the yield for the Oct bonds seems somewhat disappointing compared to the previous month’s (Sept) offering. (Eg. (Average return over 10 years of 2.75% vs 2.80%)
Others: I have basically converted my small holdings in crypto (DAI) to cash.
With the coming September school holiday around the corner, I will be taking a couple of days’ leave to spend time with my family.
For the past couple of weeks, my wife and daughter have been sick. Hope they will be well enough for a short visit to an urban farm in Singapore next week.
Thank you for reading.
FYI I find StocksCafe useful for the tracking of my own portfolio, and 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.
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Typically I use FSMOne.com to invest in funds & ETFs (including money market funds).
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Its nice isnt it, getting passiveincome every month? And as you aptly mentioned, the passive income is like an increment to your salary! I could not agree more.
I have been investing for passive income since 2011 with the main objective of having the passive income eventually covering our annual expenses. Well, it has been almost 12 years already and I am happy to say that we achieved our objective in 2016! In that year our passive income was about $150,000 about the same as our annual expenses. The 12 year journey has not always been smooth as you are aware. There were many “bears” along the way which quickly brought to focus the unreliability of dividend income investing. One cannot go into retirement with an unreliable source of passive income.
To create a reliable source of passive income, we have gone big in bulking up our CPF. We refunded the money we took out from OA for housing, we did voluntary contribution when we could and topped up our RA to the fullest..The humble CPF will pay us a combined interest of nearly $100K this year. This is a stable source of passive income that can possibly last a lifetime if you dont touch the capital.
In conclusion, having passive income is really a nice. What is important is to establish reliable sources of passive income. And the CPF can be such a source. Do not neglect it.
Thank you for highlighting this.
I will keep that in mind (not to neglect my CPF).
Agree that CPF is stable, however, the low yield is kind of a put-off given the rising interest rate environment. CPF OA’s yield is even lower than Singapore Saving Bond’s yield. (And SSB/SGS bonds are also very stable)
So far only sporadically refunded the amount used for the housing loan in CPF (a tiny amount) …
Perhaps CPF would probably have the added advantage of compounding (further interest on earned interest).
I’m Meixian from the investor relations team of Manulife US REIT. Could I get your email or contact number to clarify something regarding this article please? You can contact me via email.
Appreciate it, thank you.
I’ve replied to your email, thanks!