Friday, February 12, 2021

Feb 2021 - Portfolio & Transaction Updates

No.

 Counters

No. of Shares

Market Price (SGD)

Total Value (SGD) based on the market price

Allocation %

Category

1.

Lendlease Reit

  85,000

S$0.79

     67,150.00

20.0%

Dividend

2.

Manulife Reit

  60,000

US$0.72

     58,000.00

17.0%

Dividend

3.

Starhill Reit

  90,000

S$0.52

     46,800.00

14.0%

Dividend

4.

Ascendas Reit

  12,000

S$3.07

     36,840.00

11.0%

Dividend

5.

Prime US Reit

  30,100

US$0.81

     32,260.00

10.0%

Dividend

6.

Netlink Trust

  20,000

S$0.95

     19,000.00

6.0%

Dividend

7.

Comfortdelgro

  10,000

S$1.57

     15,700.00

5.0%

Recovery

8.

Hotung

    9,000

S$1.70

     15,300.00

5.0%

Dividend

9.

Ho Bee Land

       300

S$2.40

          720.00

1.0%

Leftover

10.

Options (IBKR/Tigers)

          -

-

     50,000.00

16.0%

 

 

 

 

 

 

 

 

Total

 

 

 

   341,770.00

100%

100%

It's the month of February and I am using the long CNY weekend to slide in some updates on the portfolio before I will commence my new job.

I tendered my resignation not too long ago and am in the midst of serving my notice period at my current company. It has been a great learning experience since I've been in the company pre-covid days and I wanted to take on a slightly different set of challenges in the role hence the move. With a heavy heart, I will be leaving some of the really good working colleagues and culture but at the same time excited to be joining a new adventure ahead.


In the past few weeks, we've seen a lot of dramas in the stock market.

Just when I thought Mr. Market Trump has left the office and we'll be back to boring days in 2021, the market never ceased to surprise me as the short saga surrounding the Gamestop and AMC caught the world's attention and has provided me with many days of entertainment the past couple of nights.

Contrary to the many out there who were "punting" about the next move on GME, and are likely losing sleep, I am taking this opportunity to boost a couple of dollars into the portfolio through options that I sold for these plays. I documented this opportunity a couple of weeks ago here if you are interested to read it. Below are some of my plays for GME which has still open dates.

Given how frothy is some of the valuations in the overall market out there I actually consider this one of my safest plays at the moment.


Separately, I have also written an article on one of Tiger's new products last week on global mutual funds - "Fund Mall" -> Here. Do check it out if you are curious about it.

3Fs "Fund Mall" Account

Portfolio Updates

Ok, quick portfolio updates for this month.

Basically, I took the opportunity to sell out a couple of my holdings and positions in the portfolio given how frothy and bullish the overall market is at the moment. Even though most of the bullish play is concentrated in the crypto and spacs, we can see just how easy it is to make money in the stock market these days that it feels very predictable. Furthermore, we've seen a lot of new entrants into the market and media covering how a 10 or 12 years old kid can make multi-returns in the past few months.

I think these are all signs that signal to me something and I wanted to be a little more cautious on my position such that I have tampered down on all my CFD positions to empty at the moment.

Most of my major REITs positions have announced results in the past few days so I am expecting a good amount of dividend to be paid out in the next few weeks. This will be a good welcome to boost the portfolio and to enjoy some dividend income.

I am not seeing too much opportunity in the market out there for a straight long position but am recently bullish on the freight and container companies out there which are seeing good demand and rates have increased pretty decently since Q4. I have some small position of play in a US company that is exposed to this sector.

Networth Updates

The equity portfolio continues to climb up slowly this month to $341,770, which is up from the previous month of $322,015.


While the goal is to continue pushing the portfolio upwards over time, I wanted to exercise caution so as not to get caught out when the eventual turn comes. That will just mean the portfolio return is likely to trail the others while I continue to look for some safe plays on the options side.

Meanwhile, if you are looking for a brokerage and research platform you may want to check out my experience using ShareInvestor WebPro and Tiger Brokers. These are my most commonly used platform for research ideas and transact platform.

Till then, stay safe, and continue to exercise prudence and caution out there.


Thanks for reading.

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Tuesday, February 9, 2021

Invest Like a Pro During This Year With ShareInvestor WebPro

Putting myself in the shoes of someone who has just started investing, it can be overwhelming to know where and how to start given the abundance of information we have on the internet to choose from. 

Because of this, there is often information that was published that we were unsure if the source provided is correct, and this can be vital especially if you are relying on the information to make a key important decision to put your money on.

WebPro - is a one-stop web-based comprehensive information developed by ShareInvestor to consolidate all of this information into one single platform.

As an investor myself who spent countless hours each day browsing through the financials and information on the company, I can totally see the benefits of using WebPro in terms of efficiency and productivity.

These are some of the key features of WebPro which I personally find useful and interesting:

Fundamental Analysis

Webpro features a comprehensive profile on the company's fundamental and financial information that would please a fundamental investor's desire to deep-dive into the analysis.

The table appended below shows how the Profit & Loss, Balance Sheet, and Cash-Flow information are presented in a single chart, which provides an easy quick glance for investors to make an informed decision.




The Financial Ratios chart is also very useful because it embedded very comprehensive lists of ratios that would be important in an analysis such as the Price/Free Cash-Flow, Cash Conversion Cycle, Inventory Turnover Ratio, Debt to Equity, Cash Ratio, and many more.

The platform also allows investors to compare the performance of up to 10 stocks at a single time.

This could be particularly useful if you are trying to compare the financial metrics of different companies in a sector (e.g banks).



Insider Trades

According to SGX Listing Rules, companies are required to disclose material information pertaining to substantial shareholder's buy or sell trades once the shareholder's stake exceeds the 5% threshold. This will allow minority investors to have a transparent view of what is happening and make key important decisions to their stakes.

To find out this information, investors may head to the SGX website, go to "Securities", and then under the announcement select "Disclosures / Change of Interests".


While the SGX website is able to allow investors to view this information openly, investors can alternatively use the Webpro feature to view this consolidated information easily.

To view the insider trades, go to "Fundamental", then select "Insider Trades".

For instance, in the table appended below, Yangzijiang (BS6:SI) has insider trades on the 7th January 2021 this year, while the previous one before that was on the 2nd March 2020.

Investors may view insider's trades as positively or negatively depending on the decision and number of shares the trade was made.


Seasonality Monthly Chart

One thing I particularly like about the Webpro feature is the Seasonality Chart which breaks down the historical return of a company by each month for the past 10 years. The Seasonality Charts returns are calculated using the adjusted historical data - which means the adjustment would have taken into account the likes of any rights issue, bonus issuance, share splits, and dividends paid out.

This is important for some industries because certain parts of the year might be more cyclical than others (e.g: retail, e-commerce). Some companies may also return better during the period before they report for their full-year earnings, so these are small clues and patterns which you can investigate further.

For instance, Jardine Cycle & Carriage tends to perform better historically in the months of April and December as compared to the other months. This could be because it coincides with the peak season sales of their automotive industry in December and also upon the announcement of their full-year earnings in early March which they will usually announce also a dividend declared.



C2 Chart

The C2 Chart is an interactive charting tool for technical analysis that allows traders to plot indicators such as Moving Average (MA), Average True Range (ATR), and Donchian Channel Indicator.

The ATR14 is an indicator commonly used to track the level volatility in a particular stock. It is taken by taking the greatest of the current high less the current low, the absolute value of the current high less the previous close, and the absolute value of the current low less the previous close. Simply put, a stock with a higher level of volatility spread will have a higher ATR, and a lower level of volatility stock has a lower ATR.

For instance, you might notice that DBS tends to have a higher ATR than its peers such as OCBC.

When the market is bullish, DBS is exhibiting a higher ATR14 than OCBC, and the same characteristics vice versa when the market is going down. This suggests that investors who are invested in DBS will experience a larger spread price movement than its counterpart in OCBC.

DBS Chart


OCBC Chart

The C2 chart also features popular break-out indicators such as the Donchian Channel strategy.

The Donchian Channel indicator is a strategy play that tracks the upper and lower band of a particular stock movement that provides a signal on potential breakout or breakdown movement.

The Donchian Channel has 3 parts:
i.) Upper Band: 20-Day High
ii.) Middle Band: Average of the Upper and Lower Band
iii.) Lower Band: 20-Day Low

The default setting for the Donchian channel is 20 days but you can change it to 50 days if you like slightly mid to longer term.

To identify breakouts, look out for intraday movement of the stock that crosses the band of the Donchian upper band, as indicated in the charts below.

This yields a better result if you have a higher volume and lower ATR than the normal trading period.

As you can see in the Micro-Mechanics example below, the stock gave a couple of potential breakout signals in Jul, Sep, Oct, and early January this year before the big run-up.


Screener

One of my favorite features in WebPro (apart from the C2 chart), is the ability to screen for companies.

You can do this by screening bottoms-up where you filter for certain criteria that you like such as dividend yield > 5%, ROE > 10%, Debt/Equity < 30%, and then the screen will filter out for you.

What I particularly like as part of the portfolio series in screening is that they have already pre-selected the metrics for you depending on the style of investing you are as an investor.

For example, if I am a trader and a momentum follower (which I am mostly for overseas stocks), I would be interested in selecting the trend following metrics.

The screen will then filter based on the few key metrics such as RSI, ADX Trend, Bullish ADX, and Moving Average and return lists of stocks that meet this criterion.




The screener also has very specific pre-selected defined templates based on the requirement you want to generate the lists of stocks you desire. I have so far tried out bullish reversal stocks, so I'll be looking to try out the rest in due time.


Final Thoughts

WebPro is a very useful platform that I tend to use on a daily basis when I am searching for information and doing chart analysis.

The great thing about the platform is it covers a wide array of overseas stock markets as well as on top of the local Singapore market. So if you are someone who is keen on investing in the overseas market (my wife is interested in the Indonesian market), she is able to also use the chart and information on WebPro.

If you are keen on trying out some of the features themselves, do head down to the sign-up link here Membership Subscription - ShareInvestor.com with a 3F Coupon Code / Promo Code (SG3FFF) that will allow you to enjoy a $10 rebate, so don't forget to use it when you check out.

After the $10 rebate off using my promo code, you are now entitled to only pay $221.80 when you sign-up for the 12-month subscription service. This is only equivalent to about 60 cents per day (which is like a cup of coffee that you order from your neighbourhood hawker these days).


So have a go and try it. You might get savvier in your investment this year.

Disclaimer: This post is a collaboration with ShareInvestor but all opinions stated are purely mine based on my own experience using WebPro.

Monday, February 8, 2021

Manulife REIT - Full Year 2020 Results & Analyst Briefing

Manulife REIT announced its Full Year 2020 Financial Results this morning and at the same time held an analyst briefing to which I was invited.

The setting was nicely done - it was in a large conference room where there are ample seats for social distancing and a clear view of the presentation.


All of the attendees were given a box of pineapple tarts as well as red packets to commemorate the upcoming Chinese New Year ahead. Thank you to the team for the surprise gifts.


Jill kicked off to give a presentation before the Q&A open floor session.

I'll try to provide more colors on what was discussed during the briefing as detailed as I could.


Like many investors, I am somewhat disappointed when I found out that DPU for Q4 was down by a massive 11.3% as compared to the previous year despite having higher GR, NPI, and DI for the quarter and the year due to the acquisitions made.

The drop in Q4 was mainly due to i.) Lower Carpark Income, ii.) Lower Rental Income due to the higher vacancies in Michelson and Peachtree, and iii.) Provision for credit losses.

On the provision for credit losses, the CFO mentioned that they are being prudent by provisioning for a one-off but these are not actual losses and could be reversed in the upcoming quarters. He then shared an update that just last week one of the tenants that they have provisioned for has paid all the rent in arrears so they would be reversing in the upcoming quarter.

He also shared that should these provisions be halved, the DPU would actually be approximately the same as FY2019. 

My thought on this is the company is just being prudent with the policy and if the recoverable plan is done properly, these will just be a matter of timing essence where investors get to reap the benefits of higher DPU due to one-off in FY2021.

With gearing rising to as high as 41% after the financial year ended 31 December 2020, there is naturally a concern among investors and fellow analysts out there.

The management is adamant and believes that their balance sheet remains financially solid and they have further debt room of about $375m before reaching the cap set by MAS. Furthermore, the CAPEX level is expected to remain similar this year and they also had a revolving facility which they can tap on.

Knowing the management practice for quite some time now, they'd look prudently for yield accretive acquisitions which is likely to be funded more by equity.

This brings us next to the topic of acquisitions.

Jill shared that they are looking for potential yield accretive acquisitions from the West all the way to the East Coast, and has also considered Business Park as their next go-to asset class.

One analyst questioned if the diversification into Business Park will make downgrade Manulife and change the company's vision into moving into other types of properties.

The management then shared that the business park in the US is unlike the business park that we have in Singapore, which usually tends to cater more towards industrial and logistics. In the US, the business park occupancy tenant can fill in the likes of financial institutions such as Meryl Lynch, and also tech company with the likes of Google. They may not be necessarily restricted to a particular set of industry classes.

My first thought on this is they must have started looking at this as a means to give them a wider choice of a pipeline, especially given that most of the US properties cap rates are in between 6-7% and Manulife itself is trading at a yield of 7.8%, it will be more difficult to look at Grade A yield accretive acquisitions if you are just limiting yourself to office play. Plus, with the gearing at 41%, it will not be easy to fund the deals with debt, which gives you a lesser choice of play from the management's point of view.



There were a few discussions on the occupancies of some locations but the overall intake that I get from the discussion is that not many tenants are willing to commit to longer-term lease (note rules in the US they cannot break lease), which MUST see it sort of an opportunity because they could then also wait for the pandemic to play out, then secure a better rental reversion once vaccines are rolled out in the 2nd half of the year and outlook looks better.

As an investor myself, I think I was overall pleased with how the management is always trying to remain transparent and provide more value to investors. If I had to be very skeptical about some things, it would be because the external factors such as US Treasury Yield going up is not within their control, and they could catch themselves trying to get potential acquisitions in 2021 venturing into new territories such as the Business Park which many investors in Singapore (including myself) are not familiar with.

The management would nevertheless ensure that any deals made would be value-adding to both the REIT and investors so this is one aspect that I think investors can rely on while keeping a closer look at further development.

Thanks for reading.

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Thursday, February 4, 2021

Fund Mall With Tiger Brokers - Your One Stop Solution For Investing In Global Mutual Funds

Tiger Brokers have been aggressively reaching out to retail investors since launching into Singapore, providing a competitive edge to its investors across the many products and services in their platforms.

If you have missed my previous two articles on some of the features, you may refer to them here and here.

Recently, they have announced the launch of their new product, Fund Mall - a one-stop destination for investing in global mutual funds that allow investors to access more than 100 renowned funds such as money market funds, bond funds, and equity funds.

Account users of Tiger Brokers can do so at the convenience of single account access - which means as long as you have an existing account with Tiger Brokers, you are automatically enrolled which allows you to purchase these globally available mutual funds at your own choice. 


The money that the investors use to subscribe to these mutual funds is strictly supervised by the financial regulators of the country where the fund is registered (e.g US Securities and Commission (SEC) or Monetary Authority of Singapore (MAS)) to ensure the safety of investors' assets.

In order to do this, investors are required to complete a simple Investment Risk Profiling Questionnaire to assess the suitability of the funds.

Investors who wished to purchase the mutual funds are required to transfer their funds from the Tiger Brokerage Prime account to Tiger Broker's Fund Mall account, which is essentially like a sub-account category to the main account.

For instance, you can see that under "My Accounts", I have two categories of funds which is Tiger Account and Fund Mall Account.

The usual buying and selling of stocks will be debited and credited via the Tiger Prime Account but for Fund Mall Account, I have to separately transfer (in my case USD100) them from my Prime Account to the Fund Mall Account.



Type of Funds Available:

There are 3 broad categories of funds that investors can choose from:

i.) Money Market Fund - Investment of monetary instruments denominated in U.S. Dollars, including but not limited to fixed-term deposit, cash equivalent, and short-term bonds.

ii.) Bond Fund - Investment of bonds, including but not limited to investment-grade bonds, emerging market bonds, high-yield bonds, or a combination of the above.

iii.) Equity Fund - Investment of stocks, including but not limited to large-cap stocks, small/middle-cap stocks, technology stocks, emerging market equity, and other stocks ETFs in the U.S. and Asia.

The appended table below shows each of the characteristics of each type of fund and the level of both risks and returns involved.



Tiger also created a curated list of funds in the Fund Mall function which you can see when you click the "Discover" tab in your mobile apps.

The curated list of funds available can be segregated by Sector, Geography, Stock Type, Fund Manager, Balanced or Five Star.


For instance, when you clicked the "Geography" logo, the platform will categorize the available funds under each of the country concentration that you desire. You can also have it categorized by selecting "Fund Manager" for example and the platform will return you some of the world's renowned fund managers and their available funds.




I also like the fact that the platform provides a one-stop Funds Fact sheet for investors to research before making the purchase.

To do this, select the funds you plan to invest, then select the "About" tab on the top, and click the "Funds Fact Sheet" at the bottom.

For instance, I have chosen the "BNP Paribas Energy Transition Classic USD" because it has been performing well over the past year due to its stellar recovery performance and I think the energy sector will continue to do well this year.




Based on the Fund Fact sheet, the fund is a total size of EUR 1.3 billion and has a total of 70 holdings in the portfolio which comprises many different sectors in many different countries.

The fund has a stellar historical performance with a 3-year Annualized performance at 26.2% while last year's performance is at 144.5%.

The management expense fee rate for the fund is at 1.50%.



In addition, Tiger's platform also makes it easy for users to view the portfolio decomposition of the funds selected by the different categories: Asset Type, Local Distribution, and Industry Composition.

This makes the glance very visible, reader-friendly, and easy to understand.




It also shows users the running NAV of the funds as well as the historical performance of the funds.




How Much (Minimum) Is Required?

The minimum amount required by investors to invest is as low as USD100, and the low commission competitive advantage provided by the Tiger Broker platform played a part in keeping the overall costs low for retail investors.

Investors can choose whether they like to subscribe to the funds in one lump sum or through a regular savings plan (RSP).

For RSP, investors can choose the frequency and amount they would like to dollar cost average every week or month so they are consistent with their savings objective.


Also, you may want to take advantage of the 0% commission for a limited period for all the funds available, which means you get to further save more money in your accounts.

Final Thoughts

I find the fund mall relatively a good product for those who appreciate the role of mutual funds and would like to leave their investments under the good hands of a professional.

While there are certain costs associated with mutual funds, such as the expense fee, these are relatively small costs compared to the amount of time and effort you have to put in on your own should you decide to get a globally diversified portfolio of bonds and equities.

If you like what you see and would like to give it a try, do use my exclusive invitation code 4321CP or simply by clicking here. You'd be entitled to a Tiger reward of up to $100 the moment you start depositing and putting your money to work.

Disclaimer: This is a collaboration post with Tiger Brokers and the article contains an affiliate link that will entitle me to a small reward for every successful registration you make. All opinions stated above are based on my own experience navigating the platform and use on my own.

Thanks for reading.

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Wednesday, February 3, 2021

You Can Still Trade GameStop (NYSE: GME) Safely, Yield Great Returns And Come Out A Winner

The past week we have seen the likes of GameStop, AMC, KOSS, and a few others dominating the news headline across the market playing out of the short squeeze thesis.

I must say that this has been one of my main sources of entertainment (I believe the same too for others) in the past week, reading across different sources and scrolling multiple forums, understanding what are others are doing and thinking.


The thesis of the Reddit army holding the line in order to cause a short squeeze and not allowing the short sellers to cover back their positions sounds strong enough and valid. Unfortunately, we are in a game of our ownself look after ownself and when there is a group of FOMO people that starts to go in at the later part of the party, there can only be one ending outcome.

Alright, I know it's extremely hard to resist the temptation when you see a 10-year-old kid or a 25 years old student making hundreds of thousands from the trade and become rich overnight. You think your mind can handle the temptation but as you read about how more and more people are making money, you start to think if this is the real deal and if you should "put a foot out to test the water".

Now, Gamestop has dropped by about 70-80% from the peak to close yesterday at $90.

There are a lot of people out there who are still making money out of Gamestop, given they are the early buyers, and are still sitting at a large margin of safety.

There are also a lot of people out there who were burnt by the experience, given that they must have been the late bloomer to the party that was already crowded. Some of these people still believe that things will rebound from here so they continued to hold on to their losses and kept on their beliefs. None of us would know if tonight they'll be right (they might well be right and their actions will be applauded), but they could also be wrong.

One thing I could be sure of is it looks like a sleepless night for many people who were involved in this saga.

For those who are looking to participate in the GameStop trade, here's an alternative option that I think is very safe and still yields great returns. You definitely can't be filthy rich with this choice and appear in the newspaper like the 10 years old kid did, but it's still a very respectable ROI return which can boost and increase your net-worth while being able to sleep very soundly at night (isn't this the most important).

Extremely Safe:

I sold 8 put contracts at a strike price of $3 on a $0.5867 premium with an expiry of 19 November 2021.

Okay, I get it. The expiry does look long for an option trader but to be able to obtain a decent amount of a very deep margin of safety for a strike price of $3, I can only play on the timeline.

If you think about the calculation, that is $0.5867 / $3 = 19.5% return in a span of 10+ months. If you annualized this across the full 12 months, that is in excess of 20% XIRR.

For something relatively as safe as this, I'd rather put my money for a 20% return here than putting my money in high-risk Reits such as LMIRT or First Reit at this point.

Note: The premium has now gone down to only $0.40 when the market closed yesterday, so you can only get a premium of $0.40 on a strike price of $3. That is $0.40 / $3 = 13.3% return in a span of 10+ months, which isn't very bad still.


Still Extremely Safe:

Okay, I know that the November expiry might be too long for a liking so I am also experimenting with the earlier expiry in July with the same variable at play.

This is what I get.

Strike price still at $3 (too safe), Premium at $0.3208 (when I bought), and Expiry on 16 July 2021.

The ROI for this option would be $0.3208 / $3 = 10.7% return in a span of 5+ months. If we annualized this, we are going to get in excess of a 25% return.

That I think is still very safe and way too conservative.


Still Safe:

Okay, the $3 strike price might be too conservative and it may not reflect the true intrinsic value of a company that is turning around.

I played around with the strike price and increase it to $5 this time around, which I reckon is still very safe at this point given the fundamentals of the company (assuming no change).

A strike of $5 for a premium of $0.55 for expiry of 16 July 2021 yields a return of $0.55 / $5 = 11% return in a span of 5+ months.

The incremental increase in the ROI is not significant if you compare it to case 2 but you could see that at a $5 strike price it is still pretty conservative.

As you increase the strike price to $10 and $20, you'll start seeing the impact of incremental value in the ROI but your risk will start to increase.


Final Thoughts

I understand we could take a bit more risk here by increasing the strike price for GME, but what I wanted to point out in this article is that you could still come out a winner with a great ROI even though you are taking a relatively lower risk with selling a put option on GME.

This is definitely better than trying to enter GME at $200 or $300 and trying to bottom fish and double down at $100, not knowing where the stock might go next.

Most importantly, you get a very nice sleep at night.

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