Wednesday 17 July 2024

Loyal Shareholders of Income Insurance Ltd See Jaw Dropping 400% Returns From Potential Bidder’s Market Valuation.

Congrats to all Income Insurance Ltd shareholders! The former NTUC Income Co-operative- which has just recently completed its corporatisation in September 2022- announced that German financial services giant Allianz plans to acquire 51% of its share at S$40.58 per share. Considering the fact that many shareholders got their share at S$10 par value (plus the 5%+ dividends over 20 yrs) and considering recent transaction on an exchange setup by Phillips Securities is at around S$20 per share, the S$40.58 offer is a whopping +400% and +100% to cost price and recent transacted price respectively. 
What happens next?
First and foremost, the above offer must be approved by our local regulator. Next, the offer needs to be approved by shareholders of Income Insurance and an EGM thus needs to be convened. The major shareholder of Income Insurance, NTUC Enterprise Co-operative has undertaken to sell part of its shares should the sales of shares by minority retail shareholders falls below the 51% required by Allianz. So, we can tell that the management of Income Insurance has given priority to minority shareholders who would want to exit. More details should be announced soon.

Parting thoughts
During late May’24 portfolio review and update, I have stated that I will be keeping my small holding of 106 shares of Income Insurance as a souvenir as the amount is extremely small and then live with its 5%-6% yearly dividend yield. However, with a S$40.58 offer, this paltry investment has suddenly grown from a mere S$1,060 to S$4,300. I guess I will definitely sell if off and then reinvest the proceeds into the Endowus bond funds.

Saturday 13 July 2024

Keppel DC REIT Back On Its Growth Path!

Good news from the management team of Keppel DC REIT!  

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Thursday 11 July 2024

SREITS and Banks Strong Rally Today (11 July 2024) After Powell Show Power!

I thought my eyes were playing tricks on me when I checked on  the SREITs market today. Not just SREITs but local bank stocks also went up. Looks like the market like Jerome Powell's message on potential interest rate cut which may happen earlier rather than sinking into recession: “You don't want to wait until inflation gets all the way down to 2%, because inflation has a certain momentum,” Powell said. “If you waited that long, you’ve probably waited too long, because inflation will be moving downward and will go well below 2%, which we don't want.” 

I am surprised but delighted to see the surge of 2.86% to 4.76% today for Mapletree Industrial Trust and Mapletree Logistics Trust respectively. I am heavily vested in the Mapletree family of REITs. Let's hope that there will be a sustained rally in price after the long drought.

Saturday 6 July 2024

Why I Am Not Taking Part In the Guaranteed Interest Rate Product Offered by Chocolate Finance?

Wow, the recent talk of the town seems to be Chocolate Finance. Recently, I kept receiving Wat's App messages from friends or seeing online posts with regard to the super attractive S$20K guaranteed 4.2% interest income product by Chocolate Finance. To be honest, the old adage of if something sounds too good to be true, then it probably is. Personally, I am staying far far away from Chocolate Finance due to the following reasons:
Guarantee by Chocolate Finance Mgt Team


1. Product doomed for failure in event of sudden global interest rate drop to fight recession
I think that it is very irresponsible for financial product designer these days to use "guaranteed high interest rate" for a certain duration to attract investments. No matter what, there is still a lead time between actual collection of funds from investment subscription to deployment into the various auv-component funds constituting Chocolate Finance latest product offering. If interest rates were to suddenly plunge, Chocolate Finance will be dipping into its shareholder fund to compensate investors. Where got business take on excessive risk like that? 

2. It is a fallacy that many folks believe that as long as the legal title of their investments is being held by 3rd party custodian, this means that one's money is safe even if Chocolate Finance goes bankrupt.
The thing is that if Chocolate Finance business model collapses, investors will no longer be able to withdraw their funds immediately. During the chaos transition while regulator take-over, there maybe loss of electronic records from system, or even fraudulent collusion by senior management and their IT team in sending of electronic records to the custodian that is holding on to all assets separately as required by the Monetary Authority of Singapore ("MAS"). I can easily think of a few more scenarios that may happen to cause months of delay in ascertaining ownership of respective individual's investments as well as the completeness of records. 

Point number 2 actually also applies for other robo advisory platforms such as Endowus. But difference here is the strength of the shareholders of Endowus relative to Chocolate Finance. Endowus shareholders include UBS, MUFG, Singtel, Samsung, Prosus (largest shareholder of Tencent) and Softbank etc.

3. The guarantee is only for up to S$20K and until 31 December 2024.
It is a waste of time and efforts to move funds whenever another Fund Management Company come out with same pattern as Chocolate Finance to call itself having the best deal in town. I will rather spend the time concentrating on my career or spending time with my family. There are already many good products out there on Endowus (Cash Smart) ,MooMoo or Tiger Brokers that have good decent money market funds offering 3.5% to 4.6% return per annum and being able to withdraw on demand. It does not make sense for one to keep going after a newer product that professes to be the "best" in the market for a 4.2% return that is not much of a difference to other similar products in the market. 

Parting thoughts
Anyway, above are just my personal thoughts and views. This is a free world. For those who likes the thrill of constantly shifting their cash around for a better deal, do go for it! :)

Monday 1 July 2024

Can Keppel DC REIT Extricate Itself Out of Its Guangdong Data Centres Misery?

Will Keppel DC REIT be able to extricate itself out of its Master Tenant default saga at Guangdong Data Centres?

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Monday 24 June 2024

Invest SREITs at all-time low or better to go into Bond Investment Instead?

I am having a headache recently with regard to my upcoming regular month end of additional capital injection into the investment portfolios. On one hand, SREITs have tanked again to near their 52 weeks low and now seems the best time to invest. Saying that, in particularly for the past few months, whenever I thought that the SREITs prices have bottomed and accumulated more units, their price just dropped further. On the other hand, my investment forage into bond unit trusts over the past 1 year has been stable thus far especially with global inflation under control- interest income which I had received is around 6% return per annum and capital price of the bond fund held their ground well. Moreover, there is also potential further capital appreciation once interest rate cuts by the US Federal Reserve is announced.

1. Invest SREITs at all-time low or better to go into Bond Investment Instead? 
I think that I will probably add on to the bond unit trusts for June 2024 month end as I have previously in May 2024 already invested approximately S$10K into both United Hampshire US REIT and Frasers Logistics & Commercial Trust  (unfortunately, both SREIT's unit price declined further after my respective purchases).

2. A close friend asked me whether Equities or Money Market Funds is the best investment in view of current market?
I thought that my friend asked me a very interesting question. My personal thoughts are that for risk averse folks who find equities and bonds extremely risky, then maybe buying into the Money Market Funds is well worth it. Singapore Saving Bonds or T-bills are also good options. 

The thing is that over the years, I have decided to just keep my real thoughts to myself whenever risk averse close friends asked me such question. I will at most just share my thoughts on the above financial instruments since their risk profile is extreme prudence and they generally ask for the sake of affirming their own beliefs (if you say something else, then it gets into a heated debate). However, the fact remains that returns from such investments will barely keep up with inflation. I think that some risks need to be undertaken in order to exit the rat race earlier.

Ok, that's all for today's post, have a great week ahead folks!   

Friday 14 June 2024

SREIT With Lowest Gearing Ratio and Attractive Distribution Yield of over 7%.

Hi Folks, today, I will be looking into this S-REIT that has one of the lowest gearing ratio among the top REITs in Singapore as well as its very attractive distribution yield of over 7%. 

Please see below for my latest video on YouTube channel. Going forward, I will be posting various exclusive investment contents onto my YouTube channel only. Please subscribe to my YouTube channel also to get the latest content for sharing.