10 Traits of Top Stocks

Came across an old issue of "Money" magazine (I think it's a Aussie edition) with an article titled "10 Traits of Top Stocks". The 10 traits connect well with my thoughts on what constitutes factors for a good stock to invest in, when it is at the right price.

[Note: 10 traits are from the article, but comments are mine.]

1. Rising earnings. It's been making more and more money. Provided it's real and not fraudulent accounting!

2. Profits cover dividend payout. It's not paying out dividends from borrowings/debts, so the dividend is sustainable.

3. Capital raising aren't needed. Doesn't collect money from shareholder - i.e. the reverse of dividends! REITs tend not to do well in this regard when times are bad though.

4. Debt is minimal. I take that to be debt-to-equity at less than 40% (<0.4) - i.e. not overly leveraged.

5. Plenty of cash for interest bill. Has the cash flow to pay the interests on their debts - i.e. wouldn't default.

6. Profits are rising. Suggests an ability to price a premium in its product and services. Either that or it is increasingly more efficient.

7. Profitability strong and rising. Makes good use of its equity.

8. Cash flow exceeds profits. Cash is king! Best is a business that doesn't require a lot of capital expenditure.

9. Value has been rising. Has a business that has been of value.

10. Value will keep rising. Has a business that will continue to provide value. The boring stuff that provides bread and butter products and services that everybody require all the time are my favorite.

[Reference: "10 Traits of Top Stocks", Money magazine, by Vanessa Gilbert.]

To Toto, or to Toto not?

So I speculated over Chinese New Year (see What is it with Chinese New Year?), throwing good money over the wall, hoping to strike a million or two. Of course, I came away empty handed, again. Even with a couple of System-7 bets, I came away with only 3 pairs of hits. Not even the lowest of lowest prize. "Phooi". As an old friend would have said, "Ka na sai!"

Oops, not supposed to say such things on Chinese New Year eh? If it's any consolation, nobody came away a millionaire on Chinese New Year either. But that's just equal misery. Not helpful.

The prize money has snowballed into a $7 million affair for the next draw on Thursday. Looks like another series of long snaking queues at Toto shops over the next few days. Shall I? Bad for productivity.

Just out of curiosity, where do all the profits from Singapore Pools go to anyway? I don't have certainty but it looks like it ends up with the Tote Board. As do all those casino levies and Turf Club and such. Tote Board then donates to numerous social beneficiaries, such as the arts, sports, education, health and communities. Sounds like a good thing, worthy causes. Guess we're contributing to social good.

Oh, my earlier bet was $35. Guess I could have had a good high tea instead?

Related:
What is it with Chinese New Year?

What is it with Chinese New Year?

What is it about Chinese New Year that I will most certainly lose my inhibitions and gladly pass my hard earned money through a window to a stranger in return for a piece of paper with a couple of numbers on it?

We know when such things happen, it's called a fool's transaction. Indeed it is. It's a disease. It's called Toto. But I can't help it. I have to do it. Hard to say no to the potential of a few million $$$.

Years ago in an office far far away, my boss told me, "If you guys are buying, count me in. I don't want to come back to an office to find that everybody's won the first prize and I'm the only person left working when that happens!"

Toto has evolved over the years. I have a funny feeling I might have thrown away a winning ticket or two in recent years. Seems like 3 numbers is all that's required to win a prize ($10). I used to think we needed 4. I'm out of touch.

The Rules to Toto are available online. It's not long. But it's complicated enough. They even facilitate by having Group Toto. How about that? Clean out the whole office. Naw. The more people that pool together, the less per share. They'll continue working. But maybe they'll be taking more leave for that dream holiday?

The latest draw on Lunar New Year (today!) is estimated at $4 million. And the upcoming annual Hong Bao Draw is Worth $12 million. Attractive right? Rare it is for a single winner. Chances are, there will be several millionaires.

I wonder what happened to all those overnight millionaires? Did they live a meaningful life of contentment and fulfillment? Or did the sudden rich became quickly poor?

Anyways, I couldn't help but dream of what to do if I hit a million or two. Would I 'retire' from work? A million, maybe. Two millions, most certainly. What does $2 million get me? About $100,000 of perpetual income per annum by my estimate.

And how do I achieve that? Perhaps:
- $750,000 in bonds or perpetual bonds (from Bondsupermart.com) @ 4-6%
- $1,000,000 in shares @ 3-4% dividends and 4-6% growth potential
- $200,000 as cash reserves for 2 years' income
- $50,000 to pay off outstanding liabilities

How about you?

p/s: Toto tickets ain't free! There's an opportunity cost involved.

Related:
10 daily purchases that hurt your budget

Boredom Amidst a Dreary Market

Boredom, that perhaps describe how I feel. For some, it must be heart-wrenching, watching the drop day after day? But I go with "Boredom".

Drop, drop, drop. For me, it has been a "Buy!" opportunity. It didn't take very long for me to empty all my cash hoard to buy more shares as they dropped more with each passing day.

I soon used up the cash holdings in the trading account.

Then I emptied the reserves sitting in a money market fund. That was soon used up.

Then I received some bonus due to pay adjustments. Lucky me. That was invested. Gone.

Then I received a year-end bonus. That was invested. Gone.

Then I reduced my excess cash in my savings accounts and placed them into the trading account. [Excess being that beyond Emergency Fund holdings. I'm not going to mess with that!] That was invested. Gone.

Then I cashed out one of my insurance policy. It was planned for, so it wasn't an impulsive action. That is being invested. Will soon be gone.

How long more is this "Bear" going to last? I'm going to run out of cash hoard soon. *wail*

Bore. Meanwhile, let's celebrate Chinese New Year! Happy New Year!

The Gahmen Gives Away Money

Kids grow up real fast. It seemed like it wasn't so long ago that I witnessed the little one being pulled out from wifey, all bloody and blueish looking. I didn't faint. Guess I'm a steady father?

And now she's already 16 and done with the GCE 'O' levels. Sheesh. Time flies.

Unfortunately for wifey and me, my daughter was born long before the introduction of the Child Development Account (CDA) where the government matches contributions, up to a certain limit. Missed the boat. The newborns are so lucky.

Over time, there's also the Edusave Account. These provide various top-ups and subsidies that really help offset the cost of bringing up the kids, up through secondary (and Junior College) education.

Recently, I came to realise there's something else called Post Secondary Education Acount (PSEA). Actually, I've been receiving letters from MOE on these accounts for my kids for some time, but I had not bothered to read and thought they were the usual EduSave updates. Dah. *roll eyes*

Apparently, the CDA account gets rolled over into the PSEA, and if the top-up limit to CDA had not been met yet, parents can continue to top-up into the PSEA and receive the matching contributions by the Government.

The PSEA can be used to pay for education in local tertiary institutions (e.g. Polytechnics and Universities).

I checked with the MOE helpdesk. No luck. My kids are not entitled to CDA. So I couldn't make any voluntary contributions to increase the PSEA funds.

By the way, these accounts earn the prevailing CPF-OA interest rate.

Related:
Interest free student loan for tertiary education
Building kids education funds with Unit Trust
Endowment plans for child education
Kids education revisited

The Gahmen is Always Wrong?

Once in a while the Gahmen pushes out a post on retirement planning and some basic guidelines, to encourage citizens to work out a viable financial future. Unfortunately, once posted on Facebook, all they're going to get is a lot of brickbats. Lots of random eggs go flying. The comments kind of irritates me quite a bit.

"Give me back my CPF and I would be fine"

How? Because the individual can do a better job of investing it? Sure, then use your CPF-OA to do so and prove it. Beat the 4-6% annualised over a time span. The ones who succeed probably don't need to depend on their CPF.

"Set a minimum wage"

Well, one company in the US did this. Ends up those who got squeezed in between became highly de-motivated as they found themselves being paid the same as those who used to be a lot less. Overall, it would mean an increase in cost to the business owner. Potentially, they could go out of business? Then no more job? But some could argue that it's a "scare tactic". I say it is very real. The less productive companies will die very quickly. And then there goes that job.

"Set my pay in pace with inflation"

Sure. But why say this to the Gahmen? Unless you're a public servant, they ain't the one paying your salary. If your boss ain't paying you right, time to leave. Else, it's really your fault. Either you suck (at what you do), or you suck (for hanging around).

"Gahmen should top up my pay"

Sure. They already do so through transfers to those who are typically poor or aged or in need of help. But perhaps it doesn't benefit everyone, so it's not felt across the board. Somebody has to pay for all these by the way. The Gahmen doesn't generate revenue from nowhere. Guess who's going to pay?

"Just give me my CPF when I reach 55"

Anything above the Basic Retirement Sum in CPF-SA and the minimum CPF-MA amounts can be drawn out then. So if one doesn't even have the minimum to provide that margin of safety, I'm not sure what's there to talk about. It's not about feeling rich and living like no tomorrow then. It's about the risk of living too long. Could be a happy problem, or a very unhappy one if health and happiness don't work out well. Don't know, haven't reached that point yet.

"I'm 85, it's too late"

My sympathy to the pioneer generation. That generation often have many kids. More kids is a diversification. But sometimes things don't work out well over time - parent's fault, children's fault, etc. If they never got married and have kids, that would be a zero. In addition, their education level was typically lower then. So job opportunities and the pay to go with it would have been a challenge. Help them.

Epilogue

The one that irks me the most was a remark that the cost of living has been going up (it's called "inflation" I think), especially beer. Oh please, stop wasting money and your health quaffing large intakes of beer. Drink green tea lah. It's called living within your means. WTF.

If you're living day-to-day, you will live poor, everyday. Fail to plan, or plan to fail? Having no game plan is just gaming away. Try Toto, might do better, if so.

More Tales from Taiwan Trip II

Tale One

In a recent trip to Taiwan, wifey had an interesting encounter at breakfast. Actually, the exact word she used was, "Disgusting!"

There was a big China tour group at the breakfast place in the hotel as the breakfast came with the room package. One gentleman from this group, presumably a Chinese national therefore, walked over to the toilet at the restaurant. Guess he was searching for a door to the gents. But he couldn't figure it out, even though there was a symbol on the door. To be fair, the door wasn't particularly obvious as there was no door knob. You had to give it a push to enter. At that point, the gentleman must have decided that he could revert to his hometown custom, doing what apparently they do in certain parts of China. He proceeded to unzip his fly and prepared to pee against the wall! Good grief. Wifey happened to see this happening and shouted at him, showing him where the door was. Maybe she should have just walked away and let it happen?

I'm not one who is particularly keen in taking breakfast at hotels when overseas on holidays. It gets a bit too overwhelming as I would then tend to overeat. In addition, that's one less meal that I can go round experiencing the local fare for more variety. I guess with parties like this, it's another reason to avoid breakfast!? Yikes.

Tale Two

At another location near Yehliu, famous for its rock formations, I went to find a toilet to relieve myself. The doorway had a sign that basically said that it was a toilet and there were guys standing all along the urinal peeing. So it seemed to be the right spot. Lo behold, with my zip down and fluid release in progress, I then noticed a line of ladies walking by me heading to the cubicles! Oh geez, was I in the wrong toilet? Apparently not. The cubicles were unisex. Apparently, such a toilet design was not uncommon in Taiwan. Very liberal.

Tale Three

With such contrasting tales of toilet behaviour and practices, I was pretty resigned to a certain standard of toilets in Taiwan. Surprisingly, at another hotel, I discovered to my delight that it had those designs I normally see only in Japan. You know, the kind where you can press to auto-spray water to clean your posterior, and could even keep the toilet seat warm. Mmmm...

Concluding Remarks

It's a strange country with contrasts. Making a link to investment, I draw a corny lesson learnt as thus:

When you're in an unfamiliar space, it's better to scout around and find out more. We may not understand the practices and make the wrong assumptions. Ask if need be, before investing into something we don't understand. The mistake could be more than just an embarrassment. Besides, not all companies in the same industry are necessarily the same in terms of quality. Deeper examination is needed.

Related:

A Tale from Taiwan Trip

The Market is a Bloody Mess!

So the headlines are now all gloom and doom.

What is Yuan may not be round

China devalues its Yuan and the rest of the world suffers a cold. As if Winter isn't cold enough for them. They need to export their cold to the rest of the world too.

Does it mean the Sing dollar will strengthen against the regional dollars? If so, then it's a good time to exploit the stronger exchange rate to go on holidays. I know, I know. Holidays are expenses. But what's life if we can't spend on gaining positive experiences discovering the wider world beyond our 700 sq km? Within limits of course.

At the same time, it's going to be bad for most local business as Singapore companies are often dependent on exports (Qian Hu). So that end of it doesn't look bright. I'd hate to be an exporter right now. Worse if you're an employee in a shaky company. Thy job is at stake too. Troubling.

What is zero can only go up

US Fed interest rate hike has taken the first step uphill and I'm sure the rest of the world will gradually follow suit. With interest rates going up, that means new bonds issues will be pegged at higher interest rates too? Sounds exciting for new bonds issue, especially since new rules are expected to be introduced soon to ease the issue of "seasoned" retail bonds in Singapore. I look forward to subscribing to new retail bonds.

The banks (OCBC, UOB, DBS) are suffering from heart attacks and are at incredulously low Price-Earning (PE) ratios. Is that a Big Singapore Sale going on here? Or are there more heart attacks to come? I think they are worth a close look. Very close. I'm suffering from irregular heartbeats from excitement.

What is going down must hit a bottom somewhere

The oil and gas, and consequently the marine industry (Keppel, SembCorp) have yet to pan out. The price of oil is now at a historical low. But the Saudi strategy of creating a glut to kill off its competition seems to be a long drawn process. It's bleeding oil until a turning point can be reached. The Saudis are patient people. Guess they have a lot of oil to spill.

How come the air tickets are still so expensive, and likewise the price of petrol at the petrol kiosks!? There's a de-sync somewhere. Somebody is making the money. And it ain't the consumer who are benefiting from the low price of oil (ExxonMobil, Chevron).

What is shiny may yet shine brighter

Amidst all these, we have a friend who has significantly faded in recent years - Gold. Is it now glittering brighter yet again? I'm not betting on it, but will keep watch. I might yet be blinded. Eventually.

Overall, as the Brits might say, "It's a bloody mess!"

Portfolio of 8 Singapore Stocks - 31 Dec 2015

On 28 Aug 2015, I started exploring a portfolio of 8 Singapore stocks with a value of ~$100,000 (Portfolio of 8 Singapore Stocks). Although the actual value would have been $99,126, I am assuming for simplicity it would be $100,000 after accounting for transaction costs.

How has it fared? It's been four months and here's how it looked like on 31 Dec 2015:

Stock	No. of  Shares	28 Aug 2015	31 Dec 2015	Value
OCBC	1,300	$9.280	$8.800	$11,440
Keppel	1,700	$7.200	$6.510	$11,067
M1	4,200	$2.920	$2.720	$11,424
Boustead	14,600	$0.855	$0.835	$12,191
Kingsmen	15,200	$0.820	$0.670	$10,184
VICOM	2,100	$6.000	$6.020	$12,642
HourGlass	17,000	$0.735	$0.785	$13,345
GKGoh	14,900	$0.840	$0.810	$12,069

The portfolio is now $94,362 (dividends not considered) and overall deeply in the red after 4 months. Obviously not making any money. The split is now 2-6 in favour of the losers. HourGlass continues to hold the fort positively alongside VICOM. But everyone else is underwater.

Market sentiments continue to be bleak, so I don't think it's going to see daylight anytime soon. But perhaps it is a good time for more fishing when pessimism is most severe?

It is the new year. So I'll stretch my neck out with a prediction: that the portfolio will be positive by the end of 2016.

Disclaimer: I have not bought such a portfolio on those dates. I am only doing this exploration for fun. But it is true that I do have all these stocks in my holdings and did buy more of some of them during Aug-Sep 2015. And I am certainly not clairvoyant, so I can't predict the future!

Related:
8 SGX Companies to Keep Watch On

An After Note on Ip Man 3

After watching Ip Man 3 (The IT folks prefer to call it "I-P-Man"), I can understand why it overtook Star Wars VII at the local cinemas.

The plot is simple. The characters are largely familiar to build upon. The new villians are introduced gradually. The action sequences are great.

But I can't understand the attempt at mandarin by our boxer man though. He's as bad as Sylvester Stallone at english, let alone mandarin. Interesting distraction nonetheless.

And who can say anything against that great punchline: that in the end, the only thing important are the people close to you? Awww, definitely a handkerchief moment.

And we have that rickshaw man who is good, then evil, then schizo but somewhat righteous. There is hope yet with humanity.

And for the cameo lead-in to the next story, we have Bruce Lee being inserted into the story line.

In another universe, Ip Man would have been a Jedi. He could feel the Force. The Force is strong in this one.

For investors, here's the weak attempt at making a connection: Stay the true path of values [investing and saving more than you spend as the one true path to financial independence]. But in the end, the most important thing is still the people who are close to you.

Corny. I know.

p/s: Boxer man is Mike Tyson. I prefer Tyson Chicken. Apologies to the Boxing fraternity and fan clubs.

Related:
An After Note on Star Wars Awakens

An After Note on Star Wars Awakens

This is a spoiler if you have not watched Star Wars VII. You've been warned!

So I bought the Subway keychains. Done.

Bought a Star Wars discounted toy at Changi Airport on the way out of the country for holidays. Done.

Watched Star Wars. Done.

Now I understand why Ip Man has outstripped Star Wars VII locally. It's really hard for newcomers to understand the characters and the plot. There're just too many things going on. It's a space opera that requires understanding from previous episodes.

For somebody like me who has been reading some of the Star Wars storybooks, it is REALLY confusing as it seems like they have changed the characters. Anakin Skywalker Junior is "Ben"? And where are the twins: Jaden and Jacen Skywalker?

On the other hand, it came across as deja vu for me - I've seen it all before, with some juxtaposition!?

Consider:

1. Rey is a scavenger who happens to be a hotshot pilot for the Millenium Falcon.

That's Han Solo, although he was a smug looking smuggler.

2. The evil guy (can't even remember his name in the show) meets his father.

It's another "I'm your father" moment. We saw that before when Luke meets Darth Vader in Episode V. Except that this time, the bad guy slices his father! Ingrate.

3. The good guys has to destroy the killer planet by taking out a single point of vulnerability.

That's what they did to the Death Star, twice (Episodes IV and VI). Although this time, it was more complex.

4. They come out with barely a few fighters surviving.

That's what happened at the end of Episode IV too.
[How would any force survive such high rates of attrition!?]

5. Rey flying off to search for Master Luke Skywalker to start her apprenticeship.

Luke Skywalker did that too when he went to search out Master Yoda likewise.

6. Master Skywalker has gone into retreat after a disastrous wipe out of the new Jedi Temple he established, because a key disciple turned rogue.

Yoda did the same thing after the wipe out of the Jedi Council in Episode III, following the betrayal of Anakin Skywalker (Darth Vader).

Originality sucks in this episode. Conversations wasn't witty enough. Harrison Ford was a saving grace. I like the new Rey character though. That's because she's nice to look at, somehow. Why does Finn give me an impression of a very gay emotional guy? Must be the acting. Action and special effects were good though.

Pick your poison.

Related:
Stock Take for 2015 on To-Do's - The Force Awakens!

A Review of Investments for 2015

2015 has actually turned out to be a horrendous year, or a wonderful year, depending on how you look at it as an investor. Checking against the STI, I realised it has actually suffered a -14.3% dropped compared to this time last year. Taking into account 3% of dividends which the STI index would not have accounted for, that would actually be -11.3% net in terms of total returns.

So if you're sitting on a 11.3% loss, you're pretty much doing market normal. You're normal. On the other hand, if you've been buying throughout the year when the market dropped, it's probably going to turn out great in the longer run. That is, provided you didn't buy a bunch of junk! You had a lot of guts and I wish you success! You're probably abnormal.

My stock investment has returned an IRR of -1.2% for 2015 inclusive dividends reinvested into the portfolio. So I guess I should take some satisfaction that I have outperformed the market for the 6th year running. Can I gloat somewhat?

However, my long term IRR has continued to slide: from ~20% (2012-13, 4-5 years), to 17.3% (2014, 6 years), and now ~12% (2015, 7 years). A case of reversion to mean? Still, 12% over 7 years is not a bad long term performance. I'm consoling myself.

The shares portfolio is taking on a more global outlook as I've started investing into other regional ETFs (esp. Europe, Asia-Pac and Japan) on top of my current holdings of Singapore and US shares. If this was a fund management company, I should probably use some other global benchmarks. But I'm not, so I will continue to reference STI as my benchmark, because that's what my opportunity cost is. I'm only accountable to myself.

Bought:
  Anheuser Busch (US)

  ARA Asset Mgt
  Aspial (bonds)
  Boustead
  Capitacom Trust
  Capitaland
  CIMB Asiapac Div ETF
  Exxon Mobil (US)
  Global Logistic
  HongKong Land
  JMH
  Keppel
  Lyxor Europe10 ETF
  Lyxor Japan10 ETF
  M1
  OCBC
  Second Chance
  The Hour Glass
  Union Pacific
  YZG
  Zagro Asia

Rights Issues Subscribed:
  ARA Asset Mgt

Sold:
  nothing!

Lots of buying, not much selling. To be precise, I've sold nothing throughout the year. I've been a stooge. Gave nothing away.

Dividend income grew marginally to $11,168 for 2015. This would have been higher of course, except that I chose to accept all options offered in the form of scrip dividends (i.e. additional shares in lieu of cash) as per previous year. I'm too lazy to figure out what the exact dividend amount would have been. But I estimate it would likely be in the region of $14,000 for the shares portfolio. That's not enough to live off my lifestyle on, yet.

But from an overall perspective, the total portfolio of shares, unit trust, investment-linked and cash/bonds has finally breached the 7-figure zone. The journey is progressing well. The point of "inflexion" (a.k.a. financial independence) is coming.

Despite a tumultuous 2015, here's wishing you a wonderful 2016 next. Happy New Year!

A Tale from Taiwan Trip

It's the year end and so it was time for my usual sojourn to some overseas destination. Fascinatingly, it seems many friends and colleagues also went to the same country - Taiwan! I wonder why? Did the exchange rate dropped and I didn't realise it?

Anyway, we were on the lake cruise at Sun Moon Lake on a bright sunny December day. The cruise (or ferry rather?) made two stopovers, first at a temple where the famous "cha ye tan" (tea-boiled egg) store is, then at a second stop where there are some streets with roadside food stalls and souvenir shops, before looping back to the start point.

The temple was no biggy, though it was a decent walk around and uphill somewhat. Good exercise with all the food binge in Taiwan. The egg was good! So it was worth that exercise.

On the way back for the final leg, we queued up to board the boat as the incoming passengers alighted.  The Captain was loitering along the queue line cracking jokes. As he past our group, he said, "Singapore!" Spot on. Guess our slang and twang was quite inescapable.

Then he passed by one of our party and said, "You're the most beautiful mother I've seen today!" Guess it was quite a compliment. Except, she's a young lady, barely 20 years old. We had a good laugh. He's blind or what? Either that, or it was the most crafty insult?

When the Captain found out his mistake though, he mumbled something to the effect that in that case, he shouldn't miss the chance. He went over to scribble something on a piece of paper and passed the slip to this lady. It was his Line contact. Line is popular in Taiwan.

That's the fastest pick up attempt I've seen. Girl wasn't interested, so I guess he lucked out. No can do.

But the thing is, this guy wasn't shy to test water and then plunge in quickly. Perhaps none too subtle. But he certainly seized his chance when he saw an opportunity.

Is that what entrepreneurial spirit is about?

Is that how we should invest? Test to assess, and if the condition seems good, plunge in?

Hits and Misses - Did I make the right financial choices?

Thinking back to the financial decisions that I had made over a span of 20 years, I wonder if I had made the right financial choices?

My very first home was a 5-room flat bought off the resale market. House hunting was quite an effort of visiting house after house. It's a pretty exhausting exercise. And by the seventh attempt, we pretty much reached a point of fatigue. It was at what would be deemed a ulu (out of the way) area known at Yishun. Whenever I mentioned that I lived in Yishun, the look from friends was one of "kampong" in a far far away land. There were actually goats along the roadside then! And to add to the kick, you get lots of helicopters flying around for novelty. The novelty wore off soon enough, and gets rejuvenated each year before National Day when the chopper with the National flag flew past. It wasn't much of a financial burden as the monthly installment payment was well within the means of a pair of newly weds. I was barely three years into the working market and didn't have much of an income for anything more anyway. So I guess this wasn't a bad decision as I did not overly burdened myself with a high level of debt.

I rate this a "hit" (right choice).

It was more than 12 years later that I decided to "upgrade" to a condominium. When I upgraded to an e-condo, it was another "ulu" out of the way kind of place - Yew Tee. "Where's that?" friends would say with an extreme look of puzzlement. It wasn't an expensive place given it's "ulu"-ness. In addition, I took whatever cash and CPF we had to pay down the principal. Now here's where I have some doubts today. While it certainly reduced the loan capital rapidly to below $100K within a year, I wonder if I should have just lived with the higher level of loan, and use that cash to invest into the market instead? Returns of 6-8% annualised would certainly have outstripped the loan interest of 3%. Plus, I could have refinanced the loan after a few years. But because I had paid down the principal to below $100K, it seems the banks weren't keen to offer refinancing.

I think this was a "miss" (bad choice).

I started investing innocently being a noob in investment. And the very first means was via insurance related means. Compared to not having any form of investment at all, it was a good start. I could rate this a "hit" compared to having no investment whatsoever. But being a bit more tuned in to options today, I would certainly say this has been a "miss". It wasn't the best of returns, though it has given positive returns. Could have done better!

Overall, a "miss".

We stayed off owning a car for several years and relied on public transportation to get around. Thank you LTA! Considering that the car is a depreciating expense, this was probably wise.

I rate this a "hit".

When my second kid was born, my wife and I decided that it was time to get a car. With a maid in tow, five person just wasn't going to fit into a taxi. Our very first car was a second hand Suzuki Swift. It was quite low cost. But you get what you pay for! The car gave us quite of bit of angst when the aircon started to behave like a heater. And one fine day, we started getting steam coming out of the bonnet. Looked like we had bought ourselves a train. Stung by this experience, we went on to buy a brand new Nissan Sunny. On hindsight, I really cannot explain why, but we changed from one Nissan Sunny to another once every three years for the next ten years. Were we crazy or what!? I guess we should plead insanity.

Definitely a "miss".

Our latest car is a Toyota Wish. A family car for a growing family. It has lasted more than six years this time. And with the price of COE in stratospheric levels, it looks like we will continue to operate it for more years to come. It has been a substantively more fuel efficient car than the Nissan Sunnys we owned previously. It has been reliable, with a few incidents of deflated tyres to spice things up. It didn't take too kindly to running over nails I guess? Notwithstanding that it is a depreciating asset, I think overall it has contributed to a certain quality of life.

So I would rate this a "hit".

Housing and cars, two VERY big cost items for Singaporeans. At $12,000 per year for car ownership, that's $184,000 that has gone to Neverland. Seems like a few hits and a few misses for me. How's yours?

Stock Take for 2015 on To-Do's - The Force Awakens!

It's almost the end of the year. Time to do a bit of stock take.

Fully contributed SRS. Checked.

Made donations to charity. Checked, checked, checked.

Contributed $7,000 to wife's CPF-SA. Checked.

Watched Star Wars.  Oops, not yet.  Time to feel the Force yet again.  The last time I did that, I was sitting in the first row of the cinema after having spent a whole afternoon of footdrill training for National Day Parade (marching contingent). Wasn't a good feeling when the screen goes scrolling with the intro.

As a stop gap, probably should go buy a Subway sandwich and get the freebie Star Wars keychain?

Bread Street Kitchen @ Marina Bay Sands

We've probably all heard his rantings on TV. Often, these were nasty remarks that pierce right to the heart. At times, it looks like he was about to get a stroke. Ah, Gordon Ramsey. Perhaps his bark is louder than his bite. And it was his food that I was more interested in.

He had found it worth his while to set up a restaurant in Singapore. And of course, it has to be at an upmarket location at Marina Bay Sands. His Bread Street Kitchen sits at one corner of the complex. Wonder what's the story behind the name though? Gordon wasn't around to answer that question.

Wifey and I decided to make a visit there on our special day. It was a long walk to the restaurant, a walk filled with much expectations. The restaurant itself seemed pretty innocuous from the outside.

With a view facing the bay though, the restaurant is actually at a very nice spot. Fascinating place for people watching too. Many joggers and tourists went traipsing by as we sat our table. I think the ambiance would probably be even more fantastic at night?

We ordered an appetizer, main course and dessert each.

I had ordered the Black Angus Steak (10 oz). When the waitress asked for my choice of sauce to go with it, I took whatever the first thing it was that she said. I didn't know what it was actually. I was completely clueless. When the dish came, it was some gooey yellowish stuff. But, it was REALLY, REALLY GOOD! Turns out it is "bearnaise". Never heard of it before. But apparently, bearnaise and steak is a match made in heaven. The steak itself was impeccable. Yumz.

My dessert was Monkey Shoulder Cheesecake with Sorbet. I was expecting a cheesecake. What came later looked like a pudding, along with a scoop of sorbet. But the taste, oh the taste! Googling the Internet, I discovered that Monkey Shoulder seems to be a whiskey. The sorbet was of course sour. But when I mixed the two, the sourness wasn't there at all. Most intriguing. The whiskey, cheesecake and sorbet blended together to offer a completely different taste experience. There is a logic to the blending. Here's a case of 1+1 does not equal 2. Yumz once again.

The meal of course didn't come cheap. It cost about $100 per person. They actually have much cheaper set meal options. But no regrets. Well worth the price from my perspective. And to top it off, the bill came discounted. Apparently, Citibank Visa has a 10% discount deal. Cool.

Oh, the service? Simply put, fantastic! I wish all service staff were so attentive, and well informed. Gordon must be paying them well.

Everything came looking great, and more importantly, tasted great! It definitely did not disappoint. Well done Bread Street Kitchen! Thoroughly enjoyed the dining experience.

Boteyju San - satisfying a crave for Japanese food

Tuesday was Deepavali. It was great to have yet another public holiday to take things easy. Zen. Happy Dewali to our friends.

I've yet to satisfy my craving for Japanese food despite having gone for a week's sojourn in Tokyo two months ago. Having no other plans for the day, wifey and I decided to give it a go at a Boteyju San restaurant at Star Vista.

Guess we were early. The restaurant wasn't crowded and we managed to get a table for the three of us. I noticed the restaurant was largely laid out for 2-seaters. Perhaps that's more of their typical clientele. Like many such restaurants, orders were placed using a Tablet (iPad?).

I ordered a mixed set which came with servings of wagyu beef, salmon and chicken, along with some potato and vegetables. Tasty enough, although the beef was a tad overcooked.

My daughter ordered the garlic fried rice. It was really tasty! Fragrant.

Wifey went for the yakisoba. It was quite good as well.

The main feature was probably the okonomiyaki which I believe this restaurant is famous for. It didn't disappoint. Might have been more fun though if we could have done some self cooking for this. Kind of remembered the fun we had when we did this previously in Japan, even if we couldn't communicate a word at all with the Japanese staff then who spoke no english! All we needed was a smartphone with a language translator! A life saver to break down language barriers.

What's this got to do with investment or finance? Not much, except maybe the point that we have to enjoy life even as we save towards a financial future. Ok, ok, that's perhaps a wee bit cheesy?

Actually, there is a link. But it wasn't the reason that led me to patronise this restaurant. It was a discovery after the fact, and therefore totally serendipitous. As I was paying for the meal, I discovered with some glee that this restaurant is actually part of a chain for which I had a discount card. 10% discount is no small amount. Thank you Japan Foods!

As a stock though, Japan Foods hasn't been great for me so far. I guess the food industry is a difficult one as there is much competition. Labour in Singapore is expensive. But I do note that Japan Foods makes use of technology to streamline its operations. Its service staff standard isn't as great though, so there's much room for improvement.

Still, the discount card hasn't been a bad thing. Slurp slurp, munch munch.

Related:
Japan Foods - Ajisen Discount

Discounts on Discounts - Saving to the Last Cents

The number of membership discount cards that we hold these days is simply amazing. Some are even in electronic form.

I couldn't help noticing how I was reaping multiple layers of discounts when I was shopping at a mall recently.

I bought dinner at the Food Junction food court. They now have a discount cash card which you can buy from their drink stall. Aside from using the pre-paid (top-up) cash card to pay for the food at the stalls, the same card offers a discount from those food stalls.

I could do likewise for expenses at the Ajisen outlet, where I also have a Japan Foods member discount card for use at Ajisen. The membership card came free when I owned shares of Japan Foods.

And if the payments are made using the Citibank Dividend Card, or POSB Master Card, there are further cash back from the credit cards.

At Popular, I could use my Popular card to buy stuff for my school going teens. On top of which, payments made with with POSB Master Card offers further discount.

Frasers malls (e.g. Causeway Point, Yew Tee Point, etc) have their Frasers Rewards app that allow members to scan in the receipts to get rewards points that are convertible to vouchers after accumulating certain number of points. And if the numerous Frasers mall isn't your kind of place, there're also the CapitaMalls (e.g. Lot One, Plaza Singapura, Bt Panjang Plaza, etc) which have the Capitastar app.

I have on occasion stupidly submitted receipts to the wrong app! Sheesh. It can be a bit tough trying to keep track of which cards and apps to use.

Trivia: How many SGX stocks can you spot related to above?

Considerations in Stock Picking

This is a reminder for myself on the considerations in selecting stocks to invest in ...

I am not a trader, so carrying out technical analysis to decide when to buy and sell by the minute isn't my thing. That is perhaps best left to a full time professional. For a working professional, a value investing approach is probably more appropriate.

Business

Business that lasts, not a flavour of the year thing.
Has products/services that is consumed again and again.
A business that is difficult for competitors to come in is best, less competition.

[I'd rather buy a company that supplies detergent than one that sells washing machines.]

Management

Reliable management, in sync with shareholder interests.
A management that owns and buy even more of their own stocks.
Not overpaying themselves as board members/executives.
Above board business dealings.

[Give me an honest management any day. One that seeks to rewards themselves exorbitantly in times both good and bad is really no different from the gold scam schemers. The only difference is that they 'steal' from investors in broad daylight without having to run away.]

Financials

Viable financials with positive Free Cash Flow (FCF).
Shows growth that is generally growing year on year. Positive earnings (EPS).
Profitable, yet undervalued. Low PE <15, PTB <1.0 (exciting)
Pays sustainable dividends; Dividends (DPS) < Earnings (EPS)

[It's hard to lie with real data. With fraud, something will not balance out, eventually. Unusual increases in Trade Receivables is not a good sign!]

"It's the business, stupid!"

Portfolio of 8 Singapore Stocks - 28 Oct 2015 [updated to correct error]

On 28 Aug 2015, I started exploring a portfolio of 8 Singapore stocks with a value of ~$100,000 (Portfolio of 8 Singapore Stocks). Although the actual value would have been $99,126 (without considering transaction costs), I am assuming $100,000 for simplicity. You could think of the difference as the transaction costs.

How has it fared since? In truth, two months is way too short a time to be meaningful. Nonetheless, here's how it looks:

Stock	No. of  Shares	28 Aug 2015	28 Oct 2015	Value
OCBC	1,300	$9.280	$9.200	$11,960
Keppel	1,700	$7.200	$7.160	$12,172
M1	4,200	$2.92	$2.870	$12,054
Boustead	14,600	$0.855	$0.955	$13,943
Kingsmen	15,200	$0.820	$0.780	$11,856
VICOM	2,100	$6.000	$6.150	$12,915
HourGlass	17,000	$0.735	$0.740	$12,580
GKGoh	14,900	$0.840	$0.825	$12,293

Thanks to CSCCC who highlighted that I had made a mistake with M1's price on 28 Aug 2015, I have adjusted the error as indicated in yellow highlights above.

The portfolio is now $99,723, so it really hasn't moved the needle over the two elapsed months. This valuation does not take into account any dividends. The split is 3-5 between the winners and losers (as indicated in red above). The only significant winner has been Kingsmen.  So it looks pretty flat-line for now and in need of some resuscitation.

Disclaimer: I have not bought such a portfolio on those dates. I am only doing this exploration for fun. But it is true that I do have all these stocks in my holdings and did buy more of some of them during Aug-Sep 2015.

Related:
8 SGX Companies to Keep Watch On

Yawning with the Bears of 2015

In late Aug 2015, I went on a buying spree as the market became a sea of red over several weeks (see Playing with the Bears of 2015). I actually saw my portfolio collapsed by $60,000 during that period. It looked like the year was heading towards negative returns. Not very exciting.

What does $60,000 mean to you? For some, it could well mean two years of salary? For others, it could mean forgoing a few overseas holidays with the family.

I went away for a week of holiday in Sep 2015. I realised I was actually pretty Zen about it. I didn't check my portfolio at all during the week overseas. Instead, I was devouring seafood and other exotica in Japan. Blowfish sashimi anyone?

When I returned from my escapade, I was most pleasantly surprised to discover that the $60,000 'loss' had been reduced to $30,000. I hadn't sold anything. The slow climb to recovery continues.

Even as that is going on, we hear warnings that Singapore could be slipping into a recession and we have to be prepared for it. So will there be more pain ahead?

Times like this, we trust that we have invested into well run companies with sustainable business models that would navigate the challenges and continue to survive. Speculating in penny stocks is likely a gamble not worth risking. In general, I don't anyway. Maybe I'm just risk adverse?

I am sometimes reminded that how well stocks perform do not necessarily correlate with how well the economy performs. While discretionary goods will likely suffer, essential goods and services will continue to be needed. Supermarkets will still be patronised, bread will still be bought for breakfast, cars will continue to go for their required inspections, etc. We will still need to eat and shit. The basics don't go away. We are certainly not returning to the cave age.

Indeed, some goods and services may well have been considered luxuries in the past. But lifestyle changes have turned some of these into 'essentials'. Consider how dependent we are on Internet services, being constantly connected on our mobiles. Times have changed.

My take is that stocks with these consumer demands will thrive. Certainly, the dividend payout provide the additional safety net of an income stream even as we sit and wait. I can be patient.

Investing is a boring affair. Anything else is a gamble. 

Yawn. [Did that make you yawn too? This is so powerful!]

Seafood at factory prices and with discount too - Fassler

Is it possible to get seafood at factory prices and still get a discount? Sounds too good to be true. but Fassler is apparently offering just that.

Fassler Gourmet
46 Woodlands Terrace, Singapore 738459
Opens Mon-Fri 0800-1700H; Sat 0800-1300H
http://www.fasslergourmet.com/

[They have a new outlet at Tiong Bahru as well.]

Having just come back from an overseas holiday, wifey and I decide to drive over to Fassler to stock up our empty fridge. To our delight, they were offering a membership discount scheme.

For a purchase of $50 or more, you can join as a member for a year and get discounts for subsequent buys. Upon signing on at a membership fee of $50, you are given a $60 coupon which can be immediately redeemed. Kind of strange as it is equivalent to saying that you are getting a discount of $10 for free membership.

While it has an online presence where you can also other their products, the membership offer doesn't seem to be offered online. But you can sign up on the spot at their Woodlands Terrace factory/shop.

Wifey and I usually go there to buy their salmon, whether smoked or sashimi grade. It comes as a whole slab. enough for 4 meals x 4 persons. And it's much cheaper than the same item found at Cold Storage. Scallops, clams, various kinds of fish, soup packs, etc.

If you're visiting for the first time and don't know where all the food are, ask the staff. It's in a walk-in refrigerated unit on the right. They provide winter jackets. If you're wearing a pair of bermudas or shorts, you're not going to last very long in there. You've been warned!

For other shops along Woodlands Terrace, see:
A Guide to Woodlands Food Factory Outlets

Staying connected when travelling overseas - Mobile WIFI

It's so hard these days to travel overseas and be disconnected from the Internet. The itch starts to set in to want to stay connected. By day two, it's cold turkey.

In the past, I would subscribe to the Singtel overseas daily plan when needed. This can range from $15 to $30 depending on the country. In some countries, buying a prepaid SIM works out to be a better deal. Set it up on a mobile WIFI device and the whole family can use the connectivity. Unfortunately, it tends to be used up real fast.

At Changi Airport, a service centre has been set up to provide such services for travellers, both inbound and outbound. I paid $8 for 5 days (special rate with a coupon code from a travel fair) for 6 days of use in Japan, as the first day's charge is waived.

Check it out: https://www.changirecommends.com/owifi.aspx

And if you use this link to make a reservation, I get a $5 voucher for the recommendation: https://www.changirecommends.com/owifi.aspx?rc=if0nn88]

The data plans vary across countries. These can range from 400 MB limit per day to unlimited. In some countries, once the limit is reached, throughput is throttled, but still functional. In other countries, the mobile WIFI is completely cut off when that happens! So need to check.

For Japan, the limit was 1 GB daily. 1 GB is a lot for a day. Unless you're surfing video none stop! It sure was handy for my Google Map app on my smartphone as I used it extensively to navigate around in Tokyo and to check which train lines to take and connect to.

I encountered frequent dropped connections on my second day there. Resetting the device seemed to work. I wasn't sure what the reason was. Initially, I thought it occurred whenever there were a lot of strong WIFI signals around. And there are plenty in Tokyo!

But I think the problem was that the battery power drained by the afternoon after several hours of use. Once that happened, it must have gone into a power saving mode. I connected it to a power bank for continuous use. That seemed to work fine thereafter.

Else I would have been completely lost in the maze of Tokyo undergrounds and trains! Happy travels.

Changes to the Citibank Dividend Card

I am one of those people who believe in putting everything I can on credit cards, but I will pay in full when the bills come in. It's so convenient these days where credit cards are accepted everywhere.

Aside from the convenience, more interestingly are the discounts and rebates. Getting money back from your spending, why not? Nothing to lose.

One of the cards I like to use is the Citibank Dividend Visa Card. A few days ago, Citibank circulated a notice that it is making changes to its Citibank Dividend Card. The changes will take effect from 28 Sep 2015.

Merchant Category Amount of cash back earned on the transaction based on that month's statement of account if spend is less than S$888^ if spend is S$888 or more^ Petrol 0.25% 8%* Grocery 0.25% 8%* Dining 0.25% 8%* All others 0.25% 0.25%

The footnote to the table further elaborated that the amount of cashback (dividend) is capped at $25 for each of the first three categories (i.e. petrol, grocery and dining). Effectively, that means that any spending on a category above $312.50 will not earn any further cashback. On the positive side, the dividend will no longer expire.

My monthly expenditure on grocery and dining tends to go way above that. Looks like I should start diverting spending to my other credit cards like DBS/POSB and UOB One cards? Citibank Credit is going to lose some of my credit spending.



No minimum spend is required to earn the cashback. But as indicated in above table, the cashback will be much lower if the total spend that month is less than $888. Huat ah!

It's rather difficult to figure out what the impact is for the individual. I wish they could have provided some indications by using my last few months' credit bills to illustrate how it would have differed from the past.

I hear OCBC has also made changes to their card (The annoying OCBC Frank credit card). Azrael was pretty annoyed by the changes to OCBC's. The banks always maintain an escape clause that allow them to make changes anytime. So it's their prerogative. But it is annoying.

Watch your credits!

Related:
4 credit cards with great cashbacks and discounts