1st Qtr 2019 : Dividend and Portfolio Update

image credit to Izquotes.com

Time flies, 1^st quarter 2019 just passed in the blink of an eye, I am sure most of us have a good return on your investment as STI has achieved +4.9% returns YTD.

My portfolio managed to outperform STI with returns of 9.7% YTD, thanks to most of the REITs and some other counters like Global Investment and Comfort DelGro.

 Top-10 Holding

Top-10 YTD Return

Portfolio as 1-Mar 2019

Total holding reduced by one to 46 with 4- Out and 3- In since the last update. I hope to reduce my total holding to 40 counters by the end of this year as to reduce those counters with less than 1% to overall portfolio value.

I am now a property agent as I have added PropNex after APAC Realty into my latest holding...:D, both companies combined control more than 50% of Singapore real estate agencies market share. I am not sure when the property cooling measure will end but I guess people will still buy and sell property although the transaction volume will be lower than the past. From their latest result, the business environment still very challenging and not expect to recovery anytime soon unless some or part of the cooling measures been removed.

I have also added Cromwell REIT in December 2018 when the price had been beaten down after the announcement of the right issue, same as Kep-KBS REIT sometimes is good to bet on huge correction after the right issues, especially for REITs where you still have a margin of safety by collecting dividend and buying at a lower price after right issues, except for OUE-Comm REIT where the price keeps dropping and didn’t recover till now.

So, which counter will be the next to announce the right issue? First REIT? hahaha…I don't have the crystal ball to tell but just spare some cash and wait for the opportunities …

My blog about REIT's right issue (here )….For investing in REITs for income, we have to accept the reality that the right issue is part and partial of REITs investment. If you can't avoid it, deal with it…

Stocks I have sold …

M1

Sold my last batch of M1 at $2.1 in November 2019 which ended my investment in M1 with a total loss of -$14,226 ( including dividend ). Don’t underestimate the price war once there is a new entrant to oligopoly market. I have a blog about my investment in M1 and regulatory risk (here ).

KSH

I have decided to take profit on this counter as the holding is small and not bad at all with XIRR of 15% in two years.

Mapletree Comm

CDL-H Trust

I have to sell these two REITs as I wanted to maintain the % of REITs in my portfolio to below 50% since I bought more Capital Retail China and added Cromwell REIT into my portfolio in the last quarter.

Both counters had given me good returns especially Mapletree Commercial REIT which I hold it since 2011.  I know both also have strong sponsors and good quality assets although the valuation is on the high side, in term of yield. I will definitely consider adding these two counters in future if opportunities arise.

Dividend Update :

Total dividend and interest to be collected in 1^st Qtr 2019 = $37,038

** which is about 9.6% higher than the same period in 2018.

1^st Qtr is normally “low season” for my dividend income as most of the blue chips will only announce their result in 1st Quarter and payout in next quarter. I hope to maintain my second-quarter dividend income are same as last year at above $60K level.

Cheers! 

“The Power Of Dividend “ (link)

But always remember that not all “dividend are created equal “, beware of some of the “ Value Trap “ …

Do rising interest rates matter to dividend-paying stocks?

This is the question I often been asked as dividend income investor and my answer is yes or no. Rising interest rate means the economy is good and central is expecting some kind of inflation. Some business like finance and banks will be benefited in a rising interest environment and some might be able to pass the cost to the consumer like alcoholic beverages. While some might be affected due to higher interest cost on loan or CAPEX like REIT / Property developer or even Telco....but even among the REITs, if those are in a good location and high demand sectors, it might still enjoy a positive rental reversion to mitigate the cost of the rising interest rate. 

The key is to have a more diversified portfolio ...when interest rate may have a different impact on different sectors." You gain some, you lose some "

STE's Portfolio Breakdown by Sectors:

Quote of The Day :

“We have almost certainly not conquered the business cycle. We may not even have tamed it.” By Philip Fisher