Portfolio Update Nov 2021

It is the last day of November 2021 and it is time to review my investment portfolios.

Generally the global stock markets started correction in recent days due to fears and uncertainty about the new Omicron virus strain. Whatever goes up will come down and the stock market will not rise in a straight line. It is pretty normal that every now and then, there will be "noises" that cause the stock markets to "crash". Will this time be another crisis or opportunity?

My SGX Income Portfolio value plummets to $264.9k from $277.6k last month.

My US Growth Portfolio value increases slightly to US$3.8k from US$3.5k. Besides selling put options to collect premium, I have initiated a small position in Palantir.

My SRS Ultra Long-Term Portfolio value drops to $88.3k from $92.2k. I have deployed my idle SRS funds to initiate a small position in Wilmar, an agriculture conglomerate. I have yet to contribute the full $15.3k to my SRS for 2021. I intend to top up another $10k to my SRS in Dec, after which I will leverage on opportunities to invest my fresh SRS monies.

I have collected more than $1k of dividends this month, built war chest for subscription of Mapletree Logistics Trust preferential offering shares and will be applying for Digital Core Reit IPO.

Portfolio Actions

1. Sold 18,000 shares of Sembcorp Marine to Temasek at price of $0.08.

2. Bought 1,500 shares of Wilmar at price of $4.33 in SRS account.

3. Sold 2 units of Palantir, PLTR211210 put option with $22 strike price at US$0.62.

Portfolio Dividends

1. Received $114 from Savings Bonds on 1 Nov.

2. Received $139.16 of dividends from Capitaland China Trust on 8 Nov.

3. Received $43.60 of dividends from Ascott Reit on 9 Nov.

4. Received $270 of dividends from Guocoland on 25 Nov.

5. Received $182.67 of dividends from Frasers Centrepoint Trust on 29 Nov.

6. Received $111.60 of dividends from Suntec Reit on 29 Nov.

7. Received $482.90 of dividends from Mapletree Commercial Trust on 30 Nov.

SGX Income Portfolio

S$264.8k

US Growth Portfolio

US$3.8k

SRS Ultra Long-Term Portfolio

S$88.3k

Thanks for reading, As always, stay safe and remain strong.

With love & peace, 

Qiongster

5 Reasons Why I Would Apply For Digital Core Reit IPO

Digital Core Reit, a pure Data Centre Reit sponsored by US listed Digital Realty Trust, has lodged its prospectus today on 29 Nov 2021 for an initial public offering (IPO) in SGX.

13.4 million units are allocated for the public and 253.7 million units are reserved for the institutional placements.

The price is US$0.88 and converted to S$1.21 per unit as determined by the manager.

Application has actually commenced from today 9pm and will end on 2 Dec, 12pm.

Digital Core Reit will be listed on 6 Dec 2021, 2pm on SGX.

Let me share on 5 reasons why I would apply for this IPO.

1. Pure Data Centre Play

Digital Core Reit will be the only pure data centre Reit on SGX because the likes of Mapletree Industrial Trust, Ascendas Reit and Keppel DC Reit which recently invested in mobile and fibre assets, do not purely own just data centres.

A data centre is a facility hosting digital infrastructure and provides a secure and reliable environment to host servers, network equipments and data storage equipments. 

Data centres are a unique property asset class which commands long weighted average lease expiry (WALE), compared to commercial, hospitality and industrial properties which tend to have much shorter rental agreements. 

2. Gain Foothold into Proliferation of Cloud Computing and Metaverse

The exploding data due to Internet of Things, applications, games and social media will drive strong  demand for data centres and such needs will only set to grow exponentially due to proliferation of cloud computing adoption by companies and the advent of Metaverse.

By owning the land and the facilities which host the digital infrastucture and computing equipments powering the IT applications in the world and the Metaverse, we can safely and peacefully make money while we sleep.

3. 100% Freehold

Digital Core Reit owns 10 100% freehold, mission-critical, institutional quality data centres located in key strategic markets across the US and Canada. Occupany is 100% in all 10 data centres. 4 are located in Silicon Valley, a fertile ground where many tech firms are built up. 2 in Los Angeles, the entertainment capital of the world, 1 in Toronto, the business and financial capital of Canada and 3 in Northern Virgina which is the largest data centre market in the world.

4. Inflation beating Triple Net Lease with rental escalations

This Reit promised a yield of 4.85% for 2022 and 5% for 2023.By having triple net lease for the lease of its data centres, the tenants will liable to pay for all the expenses of the data centres. This help to reduce operating costs and thereby ensuring that our DPU remains sustainable. Coupled with the 1% to 3% rental escalations, the DPU is set to increase slowly and steadily to beat inflation if we have the patience to hold this Reit for the long-term horizon.

5. Attractive Valuation

Last but not least, we need to ensure we get the best bang for our buck. The net asset value is US$0.84. By paying US$0.88, it is 1.05x NAV only, compared to around 2x for Keppel DC Reit and around 6x for Equinix, which is the largest data centre Reit in the world. I believe this is a steal.

In conclusion, I would be trying my luck for this largest IPO in SGX of 2021, hopefully to get a slice of this data centre pie to gain a foothold in the digital economy and Metaverse.

Thanks for reading, As always, stay safe and remain strong.

With love & peace, 

Qiongster

Mapletree Logistics Trust Shopping Spree!

After the previous preferential offering by Mapletree Logistics Trust (SGX:M44U) in Nov 2020, it is time for another round of equity fund raising.

Actually, I have been quietly anticipating for any of the Mapletree Reits to announce acquisitions and equity fund raising throughout the months and it has finally arrived. I like preferential offerings because it is a seamless and fuss-free way to add shares to increase investments in high quality income-producing Reit without incurring commissions and trading fees. Usually when such acquisition news are released, the price of the Reit will take a beating and undergo some weakness for a period of time, presenting opportunity to also add shares from the market.

On 23 Nov 2021 today, MLT has announced a proposed acquisition of 17 grade-A logistics properties in China (13), Vietnam (3) and Japan (1) for $1.4 billion. The 13 China properties will be acquired for 1.15 billion yuan (S$243.6 million) in cash, while the remaining amount will be inter-company loans worth 1.77 billion yuan that MLT will pay through cash and new units, as well as 1.24 billion in bank loans. The Vietnam properties will be paid US$14.4 million in cash with the rest via inter-company loans. The Japanese property will be paid fully in cash at 1.7% discount to the independent valuation.

An equity fund raising will raise around $700 million. The fund raising comprises of a private placement of between 209.3 million and 215.1 million new units at an issue price of between S$1.86 and S$1.91 per new unit to raise around S$400 million. A non-renounceable preferential offering of up to 163.4 million new units to existing unit holders at between S$1.82 and S$1.87 per new unit will raise about S$300 million.

What is my take?

As of time of writing, details on the preferential offering for existing unitholders are not released yet.

There is an advanced payment of between S$0.0145 and $0.0147 on 12 Jan 2023 in lieu of the enlarged unitholdings after the private placement exercise, which will be a test bed for the institutional investors on the popularity of this equity fund raising to determine the exact unit price for the non-renounceable preferential offering.

I will participate in this equity fund raising of preferential offering as I believe in the riding on the waves of booming e-commerce underpinned by Asian thriving logistics hubs of China and Vietnam for the long-term. Mapletree Logistics Trust has a great track record of rewarding unit holders with consistent, increasing income through aggressive expansion of its footprint in the Asian logistics markets. This time will be no different.

Thanks for reading, As always, stay safe and remain strong.

With love & peace, 

Qiongster

Net Worth Update Nov 2021 | Surpassed SGD 1.15m

 

S$1.152m

My net worth increases $5k from mid Oct 2021 to cross S$1.15m.

This is after the latest round of salary income, dividends passive income and CPF contributions.

I completed the voluntary housing refund using cash back to my CPF OA, which has been used for down-payment of a HDB BTO flat in Jun 2021. The refunded amount includes accrued interest too.

I have started my crypto currency journey this month. Currently the portfolio is valued at around $500 which is too insignificant to be factored into my net worth.

On the investment front,  I have done little to add on to my US portfolio, other than nibbling some Palantir shares using my spoils from selling put options. In my SRS portfolio, I initiated a small position in Wilmar for the long-term.

I believe and hope that my net worth will continue to rise over the months and years by continue to be frugal and stay invested in income-producing businesses and assets. 

I do have a target net worth of SGD 2m before age 40 (financial freedom target age), SGD 3m before age 45 (financial independence target age) and SGD 4m before age 50 (my retirement target age). The magic of compounding shall perform its wonders for my wealth.

Related post: Where are you in the 7 Stages of Financial Life Cycle?

Thanks for reading, As always, stay safe and remain strong.

With love & peace, 

Qiongster

Initiated a small position in an Agricultural Conglomerate in SRS

I nibbled 1,500 shares of Wilmar International Limited (SGX:F34) in my SRS ultra long-term portfolio today.

Wilmar Internation Limited is an agricultural conglomerate that encompasses the entire value chain of the agricultural commodity business, from cultivation and milling of palm oil and sugarcane, to processing, branding and distribution of a wide range of edible products in consumer, medium and bulk packaging, animal feeds and industrial agri-products such as oleochemicals and biodiesel.

It owns more than 500 manufacturing plants and an extensive distribution network covering China, Indonesia, India and some 50 countries and regions. Being the largest raw sugar producer and refiner, it is also the largest manufacturer of bread, spreads and sauces in Australia. In Indonesia, it is the largest producer of branded consumer pack oils. In Russia, it is the largest manufacturer of consumer pack margarine and mayonnaisse.

This is a good enticing piece of business to own. Hence when its share price retraced in recent days from $4.50 to $4.30ish, I have been monitoring and intend to add it into my ultra long-term portfolio.

The opportunity came today when my order got filled.

The company has target prices ranging from $5.80 to $6.67 set by the various broker houses after announcing earnings of US568.7 million for 3Q FY2021, up 6% year-on-year. The analysts predicted that Wilmar could potentially achieve a record year in earnings of up to US$1.7 billion for FY2021 due to improving economy in China and high commodity prices.

The company has also been occasionally buying back its own shares ranging from the highs of $5.38 to $4.33 which was made yesterday. This indicate the confidence by the company that its own share price is below its intrinsic value.

As my investment portfolios are heavy on Reits and property development businesses, it is great to add this piece of agriculture business for diversification. Despite having growth potential, Wilmar offers an attractive dividend yield of around 4.7% based on 20.5 cents paid on in 2021 at share price of $4.35 at time of writing. It also has a track record of paying dividends for the past 14 years.

There are definitely downside risks for investing in such an extensive global agriculture business. High Capex operating costs, geographical and regulation risks are inevitable for operations all over the world. Its ROE is also relatively low due to low profit margins. Nevertheless, I am optimistic for Wilmar and believe that the reward to risk ratio is relatively high and could be rewarding in the long-term.

Thank you for reading. Stay safe and be strong as always. 

With love & peace, 

Qiongster

 

Nibbled Nano and Holo

 

I started my crytocurrency journey days ago.

Today I initiated a buy into nano to test water as its price was retracing. The price continue to drop after I bought.

Nano is a promising altcoin leveraging on direct acrylic graph technology instead of public blockchain. Its advantages are unlimited scalability, instantaneous transactions and no fee due to no mining. It could potentially be the digital currency of the next era but there is no guarantee in its increased adoption rate as bitcoin and ethereum are still largely recognised by the masses in the digital currency world. I decided to initiate a small position in nano to poise for the future and will continue to add more tokens as its price drop.

I also initiated a small position in Holochain (Hot) tokens.

Holochain is an alternative to blockchain on which bitcoin and ethereum operate on. Their differences are summarised in the table below. Holochain seems to offer an improved solution to blockchain in terms of scalability and efficiency. If it could increase its adoption rate and market share in the future, its price will balloon. Again, there is no guarantee and I believe the reward to risk ratio is great hence I decided to wager small money on it to punt on its potential success.

Thank you for reading. Stay safe and be strong as always. 

With love & peace, 

Qiongster

Dabbled in Cryptocurrencies for the first time

Happy Diwali or Deepavali!

To celebrate the festival of lights, I announced that I have begun my journey into the world of cryptocurrencies.

I have been late into this game but it is better to be now or never.

I am not encouraging everyone to try out cryptocurrencies because I believe it is a form of speculative "investment" aka gambling.

Unlike financial instruments such as  stocks, Reits or bonds, cryptocurrencies do not have underlying fundamentals or assets as collateral backing and are mostly unregulated albeit being a more secured form of digital asset compared to cash and coins. 

However, if we occasionally bought Toto, 4D or other forms of lotteries that are forms of gambling to test our luck, I believe it is of little harm if we only allocate a small percentage of our net worth or liquid cash into Cryptocurrencies to test our luck too.

Afterall, high risks offer high returns at the expense of losing all money.

To begin with buying cryptocurrencies in Singapore, we have to register for a cryptocurrency exchange account first. 

There are many crypto exchange accounts to choose from, of which many are unregulated by MAS. The only regulated crypto exchange by MAS is Independent Reserve. Gemini and Crypto.com are the other popular exchanges which are granted exemption from MAS from holding a license under the Payment Services Act for a specified period of time. Not to mention other popular exchanges such as Coinhako, FTX, Huobi Global that also offer great platforms and low costs but not yet regulated in Singapore.

I decided to open accounts with Crypto.com and Gemini to try out cryptocurrencies. The account opening process was smooth and seamless. For Crypto.com, it was required to take pics of NRIC and for Gemini was using Singpass to retrieve personal info. I managed to get both accounts up within an hour.

The next step will be to fund the accounts. I then realise there is a payment middleman called StraitsX XFER used for digital asset, B2B or C2C forms of payments. So I also opened an XFER account which is to be linked to our bank account. This XFER account can be used to integrate with the crypto exchanges account to transfer funds from bank account using Fast at no fee.

For Crypto.com there is no fee period of 30 days for using credit or debit cards to buy cryptocurrencies upon account opening. I tried adding my Citibank and Stanchart credit cards but the bank rejected the transaction. In the end, DBS credit card was accepted and I tried using it to buy my first crypto coin, which was Cardano (ADA) at $2.76 each.

I then checked my Crypto wallet to see the 10 Cardono coins being deposited there.

Upon sign up of Crypto.com account through referral link, there is a free USD25 in the form of CRO coins paid to both referral and new account holders when the account holder deposit $500 to buy CRO Crypto.com tokens and stake it for 180 days for a debit card. By staking different amounts, we can get cards of various tiers. However, the 111.64 CRO tokens worth USD25 is already reflected in my wallet though yet to be unlocked.

I will continue to monitor other promising cryptocurrencies i.e. XRP, Doge, Holo, Matic and possibly nibble them. I will also purchase and hold $500 of CRO tokens to get the Ruby steel card and unlock USD25 worth of CRO tokens.

For those of you interested to sign up for Crypto.com exchange platform, you may use my referral link here. We both can get USD25 worth of CRO tokens when you stake $500 of CRO tokens for a Ruby card or above.

I am excited to begin this journey into Crypto. The excitement is like stepping into a Casino.

Thank you for reading. Stay safe and be strong as always. 

With love & peace, 

Qiongster