About This Blog

The main purpose of this blog is to share my experience in the journey to get rich happily!

I will regularly post important news and share my thoughts on the economy, markets and companies in my
watchlist or portfolio. I will also recommend investment books, finance apps and online resources that I use regularly or come across.

Another purpose is to get to know like-minded investors to share their knowledge and experience. Your comments and advice will certainly help to improve my skills and reduce my mistakes. Let’s prosper together as a community! Huat ah!

My Portfolio Allocation – Apr 2014

I sold some of my Singapore shares in April and have yet to re-deploy the cash, which was why my cash allocation spiked up to 40%. The overall return in April was +1.8%, which was pretty decent considering my sizable cash position, STI return of +1.7% and S&P500 return of -0.1%. It was boosted by my US portfolio which returned 4.2% because most of the options trade went the right way.

My Portfolio 201404

SG Portfolio 201404

Going forward, I am likely to maintain my Singapore shares allocation or reallocate some of the excess cash into blue chips or O&G sector if there is any significant dip.

See related posts:

My Trades On The Week of 28 Apr 2014

I made the following trades this week:

  • Sold Sabana REIT (M1GU.SI) at 1.025 – 1.03: Sabana REIT announced its earnings report which was below expectations. I sold my entire stake in the company because I feel that the management has not been as strong as other industrial REITs in managing the asset portfolio. I have held my shares for several years and it has returned more than 10% p.a. including dividends. But there are many better options around today.
  • Sold SingPost (S08.SI) at 1.415: SingPost has been a steady performer for the past few years, delivering consistent dividends and capital gains. But valuation is not attractive relative to its growth prospects.
  • Bought Yangzijiang Shipping (BS6.SI) at 1.1: A couple of research reports on the oil and gas sector caught my attention. The sector is generally trading at an attractive valuation. YZJ is trading at less than 8x PER and forward PER, P/BV less than 1.5 with a respectable dividend yield of 4%.

Six Life Lessons from Warren Buffett

I received an e-mail newsletter from iBillionaire on “Six Life Lessons from Warren Buffett”. I would like to share it to remind us of the fundamentals in life and investing. Happy Labour Day!

Here are six lessons gleaned from Buffett quotes that are worth taking to heart:

1. Good Things Come to Those Who Wait

Someone’s sitting in the shade today because someone planted a tree a long time ago.

No matter how great the talent or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant.

2. Good People are Important

You can’t make a good deal with a bad person.

Honesty is a very expensive gift, Don’t expect it from cheap people.

3. Take Care of Yourself

When forced to choose, I will not trade even a night’s sleep for the chance of extra profits.

Money will not change how healthy you are or how many people love you.

4. Things Can Change Fast

It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.

You only find out who is swimming naked when the tide goes out.

5. Sometimes, It’s Just Not That Complicated

You only have to do a very few things right in your life so long as you don’t do too many things wrong.

The most important thing to do if you find yourself in a hole is to stop digging.

6. You Can’t Take It With You

It’s nice to have a lot of money, but you know, you don’t want to keep it around forever. I prefer buying things. Otherwise, it’s a little like saving sex for your old age.

There comes a time when you ought to start doing what you want. Take a job that you love. You will jump out of bed in the morning. I think you are out of your mind if you keep taking jobs that you don’t like because you think it will look good on your resume.

DBS Multiplier Programme – Savings Interest Rate Up to 2.08% p.a.

 

In the current low-interest rate environment, banks offering decent interest rates on your hard-earned savings deserves some special attention. After OCBC has re-launched the 360 Account offering up to 3.05% p.a. interest rate on your savings account, DBS has launched the DBS Multiplier Program which offers up to 2.08% p.a. depending on your monthly cash flow in the account (see table below).

dbs_multiplier_201404
My first observation is that the DBS program is targeted at high-income earners with housing loan. It is difficult to qualify even for the minimum monthly cash flow of $7,500 and only a very small percentage of people will have a cash flow of more than $20,000 and above to qualify for the maximum interest rate of 2.08% p.a. For both programmes, the higher interest rate is paid on the first $50,000 only. Under most situations, OCBC seems to be offering a better deal than DBS. The links are included below for your comparison to decide which one is more suitable for you.

Click here to go to the OCBC 360 Account official page.

Click here to go to the DBS Multiplier Account official page.

 

Keppel Corporation 1QFY14 Earnings Announcement

Keppel Corporation released its Q1FY14 financial results. Key highlights as follows:

  • 8.6% YoY rise in revenue to S$3b and a 5.1% fall in net profit to S$338.7m in Q1FY14. Excluding one-off gains, net profit in Q1FY14 was largely in line with that in Q1FY13.
  • Operating margins of 14.6% in Q1FY14, or about 14.2% excluding the sale of its stake in its associate. This is close to the 14.1% margin seen in Q1FY13.
  • The O&M division secured S$1.9b of new orders in Q1FY14, of which five are jack-up rigs. This is evident of a still strong market for the jack-up rig segment, which is seeing utilization rates close to 100%.
  • The net orderbook stood at a record S$14.4b with deliveries till 2019

The key financial ratios are listed in the following table.

kep_key_ratio_201404
The fundamentals and prospects seem to be intact for the next 2 years. No strong reason to buy or sell my current holdings. However, I am looking at other smaller companies in the oil and gas sector with lower valuations and strong growth prospects.

Click here to view research report by OCBC Research

Click here to view research report by CIMB Research

OCBC Bank – Bonus Interest Rate of Up to 3.05%

CNA published an article on competition for deposits among banks in Singapore. The bonus interest rate of 3.05% p.a. caught my attention because it is way higher than current interest rates. I did a search on Google and found the following media release from OCBC:

Earn up to 3.05% p.a. with enhanced OCBC 360 Account by crediting salary to the account, paying 3 bills through the account, and by using OCBC Credit Cards.

Here’s how it works: On top of a base interest rate paid on the account balance, there are three separate ways to earn bonus interest – Salary Bonus Interest, Payment Bonus Interest and Credit Card Spend Bonus Interest – that would apply to the first S$50,000 of the account balance.

A young professional should easily qualify for the 1% p.a. Salary Bonus Interest since you need only credit a salary amount of S$2,000 or more each month to the enhanced OCBC 360 Account. To earn the other kinds of bonus interest each month, you simply pay any three bills using that account (1% p.a. Payment Bonus achieved) and charge S$400 to OCBC Credit Cards (1% p.a. Credit Card Spend Interest reaped). The Bonuses are not tied together in any way, so you can choose which Bonuses to qualify for.

It certainly sounds interesting for young working adults who can meet all the listed criteria. Of course, the main objective of OCBC is to get customers to switch banks. The attractive rates may only last for a very limited period but it is still good news for those looking for a decent return for their hard-earned money.

Click here to see the media release by OCBC.

 

 

Oil & Gas Sector – DMG & Partners Securities

DMG published a report on the oil & gas sector. The report has a table summarizing the valuations of the main companies in the region. The table on the Singapore companies is found below for your convenience.

oil_gas_dmg_201403

We can observe quite a few companies which are attractively valued, such as Yangzijiang Shipbuilding (BS6.SI), Ezion Holdings (5ME.SI) and Nam Cheong (N4E.SI). The sector is very cyclical in nature which may partly explain the modest valuation. However, the sector outlook for the next 2 to 3 years is positive, barring any recession or crisis. I was quite slow to notice the report which was published on 11 March 2014. Nevertheless, I will definitely be taking a closer look at some of the attractively-valued companies. Currently I have Keppel Corp and Vard Holdings in my portfolio. The report can be found at My Gateway on the SGX website. You could also click here to view the report.