What a crazy ride 2018 was for the stock market! Since the massive bull run in 2017, Mr Market has decided to be humble and come back down to Planet Earth. My portfolio has also under-performed the STI by some margin.
I pulled out some numbers from my blog to do a comparison:
January: STI ETF @ 4.14% V.S. Time weighted returns @ 4.88%
February: STI ETF @ 3.56% V.S. Time weighted returns @ -0.87%
March: STI ETF @ 0.91% V.S. Time weighted returns @ -2.29%
April: STI ETF @ 7% V.S. Time weighted returns @ 1.56%
May: STI ETF @ 2.97% V.S. Time weighted returns @ -0.51%
June: STI ETF @ -2.3% V.S. Time weighted returns @ -7%
2018 XIRR: -13.95% with a loss of -$39.53
As you can see, I’m slipping by 4.7% below the STI ETF for practically the whole year of 2018.
With uncertainty in the market and the increase volatility, I took the opportunity to only perform 2 trades.
- Buy in Valuetronics
- Sell in Indofood Agri
Lessons Learnt with Indofood Agri
It is important to invest prudently and with caution. Even though I was confident with my buy in Indofood Agri, I had to accept the fact that my own analysis could be wrong. My decision to cut loss would seem to have paid off now since the price of Indofood Agri decreased even more to 42% of my initial buying price, versus my materialized loss of 30%.
Who knows, but perhaps the future of Indofood Agri still looks too unpredictable to me. Since the fundamentals of the company are no longer in my favour, I will be putting this stock aside for now and keep others in priority.
Valuetronics on familiar ground
As an engineer, I would understand the business of Valuetronics. Well, maybe not fully but to a relatively reasonable level. Although their services require a good amount of PP&E, it is interesting that their balance sheet reflects otherwise despite having net profit margin of only 7%. In fact, the amount of cash that Valuetronics is holding is 3 times of Net PP&E alone. Other than that, they hold no long term debt and give out about 46.1% of their earnings as dividends. Income investors could take a look at their numbers too.
Of course, that is not sufficient enough to say that Valuetronics is undervalued. I actually think that Valuetronic’s moat is not as wide as I wish it to be, and competition is massive, especially in China. It is more of their balance sheet numbers and some of the points that I’ve mentioned above that really attracted me in the first place.
Valuetronics’s current price is 63.5 cents with a paper loss of -6.68% in my portfolio. It has dropped by down to a similar price just one year ago, but only with stronger financials. I will monitor this stock closely and wait for another opportunity to come along.
Pleasant ride with Comfortdelgro
With competition like Uber exiting Singapore, Comfortdelgro’s moat remains almost as strong as before. I treat my stocks in Comfortdelgro as a long, long, long term investment if fundamentals stay the same. In addition, it also provides me a good dividend yield at 4.45% of my investment. Thumbs up for both value and income investing!
I wonder if there will be any other (significant) competition trying to infiltrate our country again… Hmm..
REITs placed aside
REITs will no longer be one of the investment instruments that I will be monitoring closely – for now.
It would seem that the other stocks that we have bought (including small caps like Keong Hong and Tat Seng) had better yields. In our portfolio, REITs have also yielded the lowest returns. However, that is not a reason why I am not buying REITs. I have not been keeping up with them quite often these days, since there are a lot of other stocks that I am monitoring. They do not meet my investing objectives for now.
Perhaps in the future.
Dividends collected (based on Ex-Date):
Keong Hong – 1.03% ($52)
Upcoming dividends in July:
Nikko AM STI ETF – 1.63% ($147.18)
Valuetronics – TBD
YTD Dividends collected: $1331.29