What a way to end 2018! Democrats will takeover the house coming Jan 2019, ending Republican control of both house and senate and doing whatever they wished. Trump forcing a partial government shutdown and blaming on Democrats not giving him the votes to release money to build his wall. USA starting to see the signs of economic strain in Trump's tariff with China with the increased cost passing onto consumers. People worrying about slowing economy as the 2 big economic powers clashing head to head. Oil price has plunged almost 50% from the recent high. S&P 500 has entered bear market (>20% drop from high) with the recent lows while Dow Jones is just a whisker away from the bear market. And of course, Trump's ever volatile temperament with his furious twitter on increasing fed rate (an attempt at making the feds bending to his will) causing drag on USA economy and few more sacking of his team who do not agree with his view. Last but not the least, entered Trump the celebrity day trader, who twittered USA company is in good shape, now is the chance to buy stocks at such an attractive price! Seriously.... I think Trump just don't want his stock value to drop..... what a way to influence the market.
DJI ended at 23327, a drop of 3131 points (-11.83%) compared to 3Q. For Singapore, STI ended 4Q at 3068, a decrease of 189 points (-5.80%) compared to 3Q. DJI decline started in Sep 2018 while STI decline started in May 2018, 4 months earlier than DJI. I believe the current negative sediment will still continue for 2-3 more month, at least until the USA-China trade talks come to a conclusion (Or until Trump decides he cannot force China to Kow Tow to him) in Feb 2019.
As 2018 come to a close, it is time for a review again how do I fare with my 3 year plan (New Investment Strategy 2017 - Growing Passive Income)? It has now passed 2/3 of the journey and below are my result:
Original 2017-2019 plan:
- 50% Equity, 50% Reits/Trusts
- Portfolio Yield to be 1.50% in 2017, 2.50% in 2018, 3.75% in 2019.
End 2018 Snapshot:
- 68.76% Equity, 31.24% Reits/Trusts
- Portfolio Yield at 1.27% in 2017, 1.42% in 2018 (+0.15% from 2017, but miss 2018 2.50% target)
Below is my end 2018 portfolio snapshot:
On a hindsight, what I have been saying for the past 1 year (Since 4Q 2017) has come to pass. The BEAR has arrived and in a quick fashion too! For me, when people starts panic selling, it is time for me to start cherry picking counters that are at attractive prices. Continuing with last quarter practice, I am focus on defensive stocks such as high yielding equity and opportunistic buys as below:
Transaction 1: Bought in a batch of Singtel in December.
Price of Singtel has become attractive again. At $3.00, it provides about 5.8% dividend yield. Certainly a good opportunity hard to pass up.
Transaction 2: Bought in a batch of Sasseur Reit in December.
I usually don't trust China company due to many examples of bad management and shady results (Fraud. bankrupt...etc). For this counter, since it has physical assets and tied to retail, I decided to give it a try. At current price of $0.65, it will provide about 9% dividend yield according to its IPO forecast, guaranteed for 2 years.
Transaction 3: Bought in a batch of Amara in December.
This hotel company is transforming itself to retail and office landlord. I believe they will start increasing their dividend in 2019. At current price, a good chance to average down the high price I paid in 2013.
That is all for now. See you all in Q1 2019 update and thank you for reading this long long post. =)
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