Investment Portfolios Updates (26 July 2024) - Net S$620K and Projected Annualised Passive Income of S$42K.

The recent SREIT rally has finally put a brake on the non-stop downward spiralling in market prices. There is a much anticipated worldwide expectation of a US rate cut in September 2024. Based on US inflation reports and moderate job growth data, it seems chances of a rate cut is indeed high. Keeping my fingers crossed that the recent rally in price is permanent with more to come. However, Geopolitics such as the upcoming US Presidential Election (Trump appears to be the favourite to win now after his assassination) and also escalating Middle East conflicts between Israel and Iran back military groups are causing much uncertainty in global economies. There is also the very controversial Allianz offer that affects my current share-holdings in Income Insurance Ltd- please see further remarks under Portfolio 4 section below.

1. Portfolio 1- Stocks held in SGX Central Depository 
(Note: This portfolio is designed to provide immediate dividends for use as it is under my own CDP account and the dividends credited goes directly to my bank account.)

I have given up on Capitaland Investment Limited and sold off all my holdings in it. The proceeds were used to purchase additional units of Keppel Ltd stocks at S$6.62 per unit.

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 have took profit and sold off all my Ping An Insurance shares. Have used the proceeds to purchase Link REIT as well as to pare down on expensive margin loan. Margin loan thus went down from S$291K to S$281K. 

Also took a small speculative 5000 units trade in Mapletree Industrial Trust when its price plummeted to S$2.10 per unit and took profit 2 weeks later @S$2.29 per unit after the SREIT rally. 

3. Portfolio 3 (with Tiger Brokers and MooMoo) 

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

I have took profit and sold off all my Ping An Insurance shares. The proceeds were used to purchase additional Link REIT units when its price plunged to below HK$30 range (HK$29.80) per unit. Also opened up a small position in a penny stock, Oceanus, which had seen continued strong growth in its food distribution business in China. 

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

I have continued to build up my bond funds investment via Endowus platform. 

Guess the only news-worthy update here is that my NTUC Income shares market value will go up from S$1,060 to S$4,300 if the controversial Allianz offer gets approved by local regulator and shareholders. The 2 formers CEOs of NTUC Income Co-operative have come out to speak out against the deal as they do not want the insurance group to lose track of its social goal to provide cheap insurance to the lower income of Singapore society. 

Yummy Toast Box is Back!

It has been a while since Toast Box moved out of this neighbourhood shopping mall near my home. I was delighted with the management of Toast Box for re-opening their outlet recently. So lonely Ya Kun Kaya Toast now finally has some companionship at the mall…..haha. 

After my morning jog, I thought that I should support Toast Box and so went there for my breakfast. Originally have a craving for fried bee hoon and wanted to order the set. But I was flabbergasted when I saw the S$9.70 price tag for bee hoon with egg and chicken wing plus a drink. I thought that the last time the set was valued at S$6 plus. So inflation must have hit Toast Box extremely hard perhaps over the past few years?   

Disappointing Q1 June 2024 Results for Mapletree Logistics Trust But Not All Is Doom and Gloom!

What a disappointing set of Q1 2024 results released from Mapletree Logistics Trust ("MLT") with its DPU dropping by a substantial <-8.9%>. However, not all is doom and gloom for MLT. With worldwide interest rate cuts as well as the near completion of its 51 Benoi Road warehouse facility at Western part of Singapore near Joo Koon MRT (approximately 850,000 sqft  lettable space after Asset Enhancement & Improvement) that will TOP by May 2025, I think that MLT unit price will eventually recover. 

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SGX Stock Which Increased Dividends by 33% and EPS Increases But Market Price Nose Dived Over the Years.

This is one of the weirdest local stock I seen on SGX. While its Earnings Per Share improve over the past 3 years and increased dividends by 33%, its market price kept nose diving and never regain its former glorious form. I have added on to my minor stake into this stock for diversification into my current REIT centric portfolio.

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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.

Do note that since the announcement of this deal, ex-CEOs of NTUC Income Co-operative have came out expressing their opposition to the sales of shares by controlling shareholder NTUC Enterprise. Even the influential Prof Tommy Koh (ambassador-at-large at the Ministry of Foreign Affairs, a position he has held since 1990, and a professor of law at the National University of Singapore) is now challenging NTUC Enterprise Chairman Lim Boon Heng’s justification for selling away their majority stake in Income.

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.

Keppel DC REIT Back On Its Growth Path!

Good news from the management team of Keppel DC REIT!  

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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.

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! :)

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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