Investment Portfolios Updates (9 May 2025) - Net Investment of S$723K and Projected Annualised Passive Income of S$47K.

Wow, it has been a long 3 weeks since my last post. I had been super busy for the past weeks with entertainment of overseas clients and execution of a major project at workplace. Finally have some moment now to catch my breath and also do a quick post. I don't think things are fine at all albeit Donald Trump claiming that US and China having a "total reset" of their acrimonious relationship during the Geneva negotiation over the weekend. Since the "Liberation Day" trade tariff announcement by Donald Trump on April 2, 2025, stock markets worldwide plummeted. Despite the subsequent pull back of the reciprocal tariff by 90 days (except for China) by Trump a few days later, the damage has been done. My gross portfolios were not spared and fell to below S$1Mil while overall net investment after netting off margin loan hovers around S$723K.

1. Portfolio 1- Stocks Held in SGX Central Depository 

Not much changes here while waiting for the storm to stabilise. May'25 and June'25 have a couple of dividends payment. Haw Par Corp also paying out its usual dividends plus a special dividend totalling S$1 per share on May 21, 2025.

2. Portfolio 2- Margin Purchased Securities

(Note: My margin purchased securities has grown to a sufficient scale to sustain itself and can pay off annual financing charges as well as to gradually pay down the margin loan through dividends generated.) 

I closed off my ICBC China banking stock of 12,000 shares at 13% profit to reduce leverage. Also, sold off all my rights issue (2,000 units) from Frasers Centrepoint Trust to lock in the small profit. Margin loan has been reduced from S$291K to S$273k in view of the gloomy marco-economic outlook.

3. Portfolio 3 (with Tiger Brokers and MooMoo) 

(Venture into higher risk as well as capital growth stocks here)

Interestingly, Link REIT, Alibaba and Bank of China rallied after the recent emergency meeting by the Chinese government. There are plans to include Link REIT to stock-connect-the inclusion of real estate investment trusts (Reits) in the China-Hong Kong Stock Connect mechanism will expand the investor base, increase the trading liquidity and attract more listings of these collective investment schemes to Hong Kong, analysts said.

4. Portfolio 4 (Endowus Unit Trusts & Other Investments)

I have reduced the equties funds (Fidelity Global Dividend Fund & Franklin Templeton) exposure and switched them over to the PIMCO Income bond fund which is offering an attractive annual yield of 6%.

Parting Thoughts

I do not think that Trump is going to drop the China Tariff by a lot. The Chinese government are in a stronger position and it benefits China to drag on the current standoff as it is obvious that Trump has screwed himself and is in hot soup over the lack of goods in retail stores and lack of China containers coming into US ports. 

Updates as at 12 May 2025: Speaking after talks with Chinese officials in Geneva, US Treasury Secretary Scott Bessent told reporters the two sides had reached a deal for a 90 day pause on measures and that reciprocal tariffs would come down by 115 per cent.

Donald Trump Scores Own Goal And Destroy Worldwide Stock Markets- The King of Mayhem.

Wow Bian, I woke up this morning to the astounding news that President Trump has decided to do a U-turn to “exempt” smart phones, chips, computers from the China tariff of 145%. Then why impose the 145% China import tariff in the first place which ends up with China retaliatory tariffs against US exports that hurts its own people? Not sure what Donald Trump gains from his “negotiation strategy” which is nothing short of an own goal. No wonder Elon Musk asserts that Donald’s top trade advisor is “dumber than a sack of bricks” and a moron.

What to do during this stock market crash?

1. I have been reserving some of my limited cash in event that the stock markets tank further. There maybe a few dead cat bounce given that business sentiment across the world have been really bad and bruised from the US tariff that is causing disruption and chaos everywhere. We maybe already in a recessionary environment. So be wary not to enter fully into the equity markets but to spread the entry over a few tranches.

2. At the same time, it seems a too good opportunity to be missed after the recent crash. There are a lot of companies out there now trading at a further discount of over 10%. I have added the following over the last week:

(i）Alibaba (9988) at HKD99-cash 

I nibbled away at a tiny 100 shares since Alibaba already got so much cash on its balance sheet and also a big discount off its past few months of rallied price. I like its e-commerce and AI investment.

(ii) Nikko AM REIT index (“CFA”)

CPF OA. REITs are at a 52 week if not 5 years low. I am seriously wondering how low can REITs go at this juncture and willing to take some risk with my CPF OA. Added a further 28,000 units over the week. Please also see my post in March 2025 on this CFA index fund- basically, it enables one to use 100% of CPF OA without the usual 35% restriction on investable amount above S$20K.  

(iii) rights issue for Frasers Centrepoint Trust (Cash + Margin).

Now, this one is a tough one for me. I was initially thinking of utilizing the cash for buying into 1 of the 3 Mapletree REITs as the distribution yield for these have been over 7% with the recent crash whereas FCT has a so much lower distribution yield of around 5.8%. But decided to invest into something that is fully vested in Singapore neighborhood shopping malls that has more predictable rental income streams. Took up my allotted rights of around 1,000 units and subscribed for excess of another 1,000 units.  

Parting Thoughts

Nothing much to say…..I am speechless over the antics of the King of Mayhem that single-handedly erased around US$10 trillion dollars from global stock markets in a few days. So much wealth vaporized overnight is simply shocking.

Beware of US Bonds Also Declining in Trade War- No Asset Class Safe.

Interestingly, I noticed that my PIMCO Bond funds purchased via Endowus have been declining recently. Rising interest rates on bonds seems to be due mainly to sell off by worldwide investors who are losing confidence hence US bond value has declined. Apparently, the ripples from Donald Trump's trade wars have sent US government bond prices down sharply last Wednesday, driving up yields in a paradoxical development as the global economy faces a recession. A key safe-haven asset, US Treasuries usually offer lower yields when investors seek shelter from volatility but has now been viewed as a risky asset class with a higher yield. What a strange twist this has turned out.

So do look out to ensure broad diversification in terms of asset class as well as geographically in one’s investment portfolio. 

The Tragic Fate of SREITs- Battered Down Time and Time Again Over Past 5 Years.

This is just a short post to ramble on SREITs which have always made up the bulk of my investment portfolios. The SREITs journey over the past 5 years have been nothing short of a major disaster. Since the 2020 COVID crisis, REITS prices have been hammered down non-stop. After COVID, too much money printing worldwide lead to inflation getting out of control and the US Federal Reserve started increasing interest rates which led to sudden spike in financing cost and borrowings/leverage ratio soaring. 

Just when everyone thought that the global inflation is under control and interest rates finally coming down, the megalomaniac and narcissitic Donald Trump kicked off the tariff war swhich seems to be the onset triggering off of a global recession. Many SREITs such as my favoruite Mapletree Industrial Trust ("MIT") is already at its 5 year low as at 8th April 2025. I am wondering how much will SREITs be further dropping this week given that China will be announcing its retaliatory measures to Trump's additional 50% tariff hike as China has mentioned that it will not be blackmailed into submission and will fight US tariffs to the very end. 

How does Donald Trump plan to make America great again when using artifical tariffs simply erodes America's industrial competitiveness? Also, for much of the products being manufactured, US does not have the competitive advantage. Today's news report that Trump's wishlist of moving back iPhone production to US will mean the cost of iphone going up from US$1,000 to US$3,500 per phone. Even if the tariff is now 100%, it will still be cheaper to import them. Consequentially, consumers back in US will still be bearing the brunt of the tariff being imposed. Focusing on US competitive advantage in its tech and financial services maybe better in the long term I thought. 

Fear of Black Monday from Trade War To Be a Self-Fufilling Prophecy?

Just be careful when many folks are shouting out Black Monday for today's trading......we may just witness the self-fufilling prophecy theory in motion with everyone rushing for the exit and much panic selling. In a recession (which is starting to look like a Global Depression if worldwide trading volume drop substantially), even if interest rates are cut, SREITS will also not escape unscathed. Not sure whether Frasers Centrepoint Trust ("FCT") rights issue at this juncture will go through smoothly- assuming a global market bloodbath this week, if unit price of FCT drops below S$2.05 per unit, then the rights issue will be a gone case. So don't be the first one to rush in to subscribe for the rights. Wait till the end of subscription period to assess further.  

Nonetheless, I do not think I will be adjusting for my cash investment porfolios. Also being vested in the market for the long term rather than playing trading suits me better. No one knows what Donald Trump is playing and maybe he will do a sudden reversal of his tariff threats. I am glad that 1 month ago, I have commenced adjusting my CPF Endowus portfolio configuration from mostly equities focused into a 70% bond and 30% equities. On hindsight, maybe should have just converted 100% of the unit trusts into bond funds. As for my other CPF direct investment into SGX REITs index fund recently, I think I will just leave it for now. Looking forward to deploy rest of my CPF OA into the US market if the S&P 500 crashes to COVID-19 level.

Keep your fingers crossed folks. 

Grab Got 10 Years License For Taxi In Singapore- Strange Venture Into Sunset Industy?

We have already seen the video of rows of empty SMRT taxis being parked long term in public HDB carpark. So it is a somewhat mind boggling to learn that Grab has just joined the fray into the local Singapore taxi service sector. Perhaps, Grab saw their competitive advantage in their popular online booking platform giving priority to their own taxi fleet on top of being able to do stop and pick up along the road. Nevertheless, it has been a bloodbath on the local taxi industy (ComfortDelgro and SMRT taxi arm all in trouble) which has been in the doldrums since the coming of Uber and Grab that disrupted their traditional taxi business model. 

I do hope that Grab management knows what they are getting themselves in and have already done their sums. Nevertheless, I view extra competition as beneficial to consumers. 

Quick Thoughts on Frasers Centre Point Trust Upcoming Rights Issue- Potential Trading Opportunity.

Just penning down some of my quick thoughts for Frasers Centre Point Trust ("FCT") upcoming rights issue to fund the purchase of Northpoint City Southern Wing which is a popular mall in Yishun. This exercise is a no choice election but forced to subscribe to avoid dilution kind...so no need to think too much over it, unless there is a downturn in stock market. Only question is whether one want to subscribe for excess rights. The current market price hovers from S$2.170 per unit to S$2.19 per unit after the announcement. The ex-dividend date is 3rd April 2025 (Thursday) and worth S$0.0615 per unit. So if you own 10K units, you will be getting dividends of S$615 in total. I expect the price range to drop to between S$2.10 per unit to S$2.13 per unit after the ex-dividend record date.

1. Preferential Offering Attractiveness Analysis

The issuance price will be between S$2.030 and S$2.070. Assuming somewhere in between of S$2.050, this will be a discount of only +2.4% to the lower end of the market of S$2.10 per unit. If market price hovers at S$2.13 per unit, then it will be at a higher discount of +3.9% to the upper end market price of S$2.13 per unit. Saying that, if the market price tanks due to the current tariff war and other unforeseen macroeconomic events, then one would have to hold and wait it out for the long term. I will probably be subscribing for some excess rights for speculative purpose in the hope that I can sell them off for a tiny profit to eat egg fried rice with pork chop at Ding Tai Fung.

2. Indicative Timeline For Retail Preferential Offering

For fellow retail investors who are interested in this exercise, please take note that the tenative commencement timeline is 8th April 2025 (Tuesday) for retail tranche offering. This exercise will end in about a week, that is, 16th April 2025 (Wednesday) so do indicate your acceptance by this date.

Parting Thoughts

Personally, I am not extremely excited by this rights issue as FCT has higher potential business risks ahead with the Johor Bahru Rapid Transit System ("RTS") rail project that may take away many shoppers from Woodlands and other suburban malls. In addition, FCT is also in trouble in one of its smaller Mall in Hougang where the government is launching a huge plot of land this year for a mega shopping mall just next to it. Frasers will most likely be bidding aggressively for this intergrated project as a defensive maneuver (similar to what they done for Northpoint City integrated development). But we will have to wait and see what happens next.

(Updated 7 April 2025: This week will be mayhem on the stock markets, not sure whether Frasers Centrepoint Trust ("FCT") rights issue at this juncture will go through smoothly- assuming a global market bloodbath this week, if unit price of FCT drops below S$2.05 per unit, then the rights issue will be a gone case. So don't be the first one to rush in to subscribe for the rights. Wait towards the end of subscription period to assess further.)