Letter To Shareholders (18) - Performance Review 2020H1

Economy Commentary
2020 has been so insane that I don't even know where to begin.

From Covid initial discovery in China, lockdown of Wuhan, first case in Singapore, us first being hail as the gold standard, the global pandemic, outburst in dormitories, the Circuit Breaker and now "on the road to recovery".

Everything happened so fast and it's been one hell of a rollercoaster - the market saw it fastest collapse in history where it took a mere 16 days to reach Bear Market. I could not believe my eyes when I saw blue chip companies and REITs with strong fundamentals (capitaland, mapletree) collapsed >10% overnight.

The crash was so dramatic it shook me to the core - at one point I almost capitulated emotionally (I had to ignore all daily portfolio updates). At its trough, I was down almost $80K. Thankfully, logic won in the end and I manage to persevere. As of end June, I've recovered $50K. Still, this thing is far from over and theres no telling if my portfolio can recover fully or plummet back beyond March's level.

It is always easy in hindsight to make comments like "you're so lucky to encounter a crash of a lifetime and buy big". Well, after this episode, I'll say someone deserve it if he has the guts to.

No amount of fancy charts and complicated tables assuring me that since 1939, the markets always recovered after dropping a single day of 10% can help you. No amount of Warren Buffett quotes that the markets always recover, belief in innate humanity in each of us to work towards a better tomorrow, etc... can hep you.

You must  have that unwavering conviction. All the logic can do is only appease the mind, but not the the heart when your portfolios is tanking. 

"All I could think of was my portfolio going to zero and getting a margin call from the broker to tell me that I had wiped out my account. There can’t be a recovery, if there is nothing left in the pot."

This is why I neverinvest with borrowed money.

In 6 months, we've seen numerous bankruptcies and layoffs, plus the fraud of Luckin Coffee ($50 to $3 in months), the collapse of Wirecard (once the pride of Germany), how Hertz stock can go up 300% after filing for bankruptcy. 

Closer to home, I suffered badly at the hands of Eagle Hospitality Trust (painful and valuable lesson, that the integrity of management matters more than whatever assets value they show on balance sheet). We also see blue chips like Comfort Delgro, SATS and SIA being decimated by the Circuit Breaker.

Performance Review Highlights / Acquisitions & Developments
We took massive action during the crash, dollar cost averaging 4 times into STI (spending over $40,000). brought Capital Comm Trust (at an insanely cheap price, partly to avoid odd lots after merger), DBS (long-term holding), and Accordia Golf Trust (on news of acquisition, which is now confirmed).

The 2 biggest event in our portfolio was the suspension of EHT (managers and sponsor are now accusing each other of all sorts of shenanigans, facepalm) and the demerger of SCI and SCM. 

SCI, EHT and Kimly now stands as the 3 biggest bleed in my portfolio. 

On reflection, what would I have done differently and what mistakes did I make?

SCI: If I have to think of an excuse, it would be a combination of bad luck and blind faith. I still believe the utilities business is defensive, but who would have thought oil would crash to $20 and at one point of time even went negative? I also had faith on its status as a Temasek backed company, but SCI could have easily been Keppel. In all, Temasek-backed only "ensure" the company doesn't go broke, but it doesn't mean you won't lose money (they can always issue cheap rights and have Temasek underwrite it).

Kimly: Greed. Over-focus on its "defensive" business as a coffee shop, not realizing that it's still subject to market forces (competition from food court, increasing cost of foreign labour). And of course, as a smaller cap, there is always the chance of governance issues.

EHT: I already knew it was largely gambling and speculation when I first brought into it. I knew insiders were selling cheap even at 50cents and the problems of Queen Mary - but the dirt went far deeper than I thought, to the point of outright fraud. Covid was the last straw which broke the camel back. We really need to stick with reputable companies

There were little chance I could have avoided these 3 companies. What I could do better is to manage my asset allocation so I did not invest as much in speculative positions.

Operating Highlights - Income
Income grew around 15% due to higher bonus (record high) and higher salary (unexpected promotion). Dividends were largely in-line with last year.

Received a decent amount of "SG Package" which was used to offset certification exam.

Operating Highlights - Expenses
Expenses were much, much lower (from $9800 to $7100) especially in Q2 thanks to the Circuit Breaker. That's $2700 lesser than less year!

No big expense except for a Mayday concert ticket (which was postponed to next year)

Operating Updates
With the massive cuts to interest rates, banks deposits are no longer attractive (you can only get the same if you satisfy the difficult conditions of DBS Multiplier).

We decided to move out from CIMB (0.5%) to Singlife (2.5% for first $10k, 1% for subsequent).

Passive income from bank interests will be greatly reduced this year and fall even more next year once my CancerCare plan hits 12 months.


Outlook
The good news this term is the launch of several low cost brokers - Tiger Broker and IBKR (Singapore). I figured once the DBS Multipler 3 tier interests is up at year end, I will start diverisfying into overseas stocks. Singapore old economies will no longer do.

I will most likely tap on IBKR (Singapore) for IWDA and certain China stocks like Tecent if I could not find a good diversified China ETF then.

Humanity’s progress has never been smooth. There are always things to worry about. But tomorrow will be a brighter day.

Circuit Breaker Games

Apps & Games

- Bench

- 全民 Party

- Airconsole

- Houseparty

- Board Game Arena

- https://netgames.io/games/

- https://www.pokernow.club/ 

Covid19 Black Swan - A Repeat of History & Lessons

If this market event is a repeat of history, then those with strong holding power who can farm their salary into the financial markets without breaking a sweat will be almost assured a straight path to becoming a millionaire when all this is over.

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"You don’t need conservatism, caution, risk control, discipline, patience, or selectivity. You need (to have) money and the nerve to spend it." Are you daring enough to make the move, and wait patiently for the recovery to come?

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I heard many people commenting that they expect the stock market to fall even more or that it will be a long time before stocks can recover from this shock.

These are not amateur investors, these are fairly good and experienced investors, many of whom often preach the mantra "don't time the market", but suddenly they all become market-timers and predictors of the stock markets.

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Why you should never leverage: now that I have a 100% leveraged portfolio, I have a very real problem. In this market crash, my unrealised losses were dropping at twice the speed of the market. In other words, I was stepping on the gas, while speeding into the abyss.

No amount of fancy charts and complicated tables assuring me that since 1939, the markets always recovered after dropping a single day of 10%, bla bla, every made it in the fog. All I could think of was my portfolio going to zero and getting a margin call from the broker to tell me that I had wiped out my accountThere can’t be a recovery, if there is nothing left in the pot.

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If you ask me where the market would be 10 years out, which is really the minimum timeframe for anyone in 100% equities, I can tell you with a high degree of confidence that your nest egg will be better off than it looks on paper today.

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This is data-evidenced: the stock market always recovers and go up over the long term. We are almost -30% from highs in a bear market. That is a very rare event. The COVID-19 virus is very challenging economically, some governments will do better than others, some countries will take longer than others. But none of this changes the fundamentals of the economic or financial system, which is why the stock market always goes up in the long term. Anchor your goals on that.

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Fast forward to today, my entries are gradually becoming more hesitant and also smaller in size. It’s not because there’s too many things to buy. I am just worried about finishing my precious cash fast and sinking deeper into the red with each coming day.

The reality is not as simple as the theory so kudos to those that made their pots of gold then.

This is like watching a football match and cursing the player when he makes a poor decision. It’s not easy performing good decisions live, in the thick of the action. We are mere mortals.

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At the extreme moments of fear and greed, the power of the daily price momentum and the mood and passions of ‘the crowd’ are tremendously important psychological influences on you. It takes a strong, self confident, emotionally mature person to stand firm against disdain, mockery, and repudiation when the market itself seems to be absolutely confirming that you are both mad and wrong. Also, be obsessive in making sure your facts are right and that you haven’t missed or misunderstood something.

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Meanwhile, innovators are still innovating all over the world. People are staying up late working in labs, vaccines are being tested, genes are being sequenced and the current virus will end up beaten and then written up as a very significant chapter in the history books.


But apart from all of this, there is still way more going on out there, which just isn’t making it to the headlines. Engineers and scientists are still inventing things that will drastically improve the future. Solar panels are still streaming out by the trainload and being installed worldwide. Better and better batteries which will eventually displace all fossil fuel use are evolving. The most efficient factories in history are being built. Gene therapies are advancing which will eventually make a mockery of all of our current health conditions. Internet connectivity and education is becoming more widely available and cheaper which is allowing the next generation of brilliant kids to to grow up and learn faster and do more than you or I could have even dreamed. And all this will happen regardless of the course of the current pandemic.

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Let me repeat. If you can help it. DO. NOT. SELL. PERIOD. Investing during a crash can be scary.


However, the worst thing you can do in a stock market crash like this is to make your paper loss into a real one.

If I was an emotional investor, most likely:

“SH*T!!! I sold right at the bottom! The U.S. stimulus and all the government intervention finally worked! I better get in before it shoots up even more and I miss the rise!”

Then I would have bought it higher than when I sold… as the market begin to come back down again. If I sell, any market movement up will cause me to stress about “Is it the bottom THIS time?” and “What if I will miss the bottom and buy in too late?”

It will become a never-ending cycle of panic buying and selling. Only losers play this game.


Stay invested, save yourself from anxiety and sleepless nights.

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if you buy now and continue buying with funds that you can afford to keep invested over 10-30 years, you are guaranteed to come out ahead


At the moment everything is on sale. Yes maybe it will be on a deeper sale in a few months. But if you’re still working and investing your income over time, the difference that a few months will make will be insignificant in the long term. What’s important is to be invested and continue adding to your investments.

Sitting out and never jumping in is the biggest risk you can take. If you’re still nervous, you can read the story about the world’s worst market timer again.

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Regardless of what the Oracle ends up buying, Buffett can’t time the bottom any better than you or I. He’s made plenty of opportune investments over the years but that doesn’t mean his success hinges on nailing the absolute nadir of the market.

It’s easy to become obsessed with predicting the bottom during a market crash. Positive outcomes during down markets have more to do with your time horizon as an investor than your ability to call the bottom.

When the stock market took a nosedive in the 1960s, one of Buffett’s clients called to warn him that stocks would surely fall further. Buffett responded with two questions:

- If you knew in February that the Dow was going to 865 in May, why didn’t you let me know it then?

- And if you didn’t know what was going to happen during the ensuing three months back in February, how do you know in May?


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It is somewhat laughable to suggest that the current situation will derail the FIRE movement, like what I’ve seen on Twitter-land.

In all honesty, the FIRE community is the best-positioned people on Earth who can weather this storm. We have what it takes to rein in expenses. To craft multiple sources of income. To protect our assets. The resources to ration with. The will to survive with the bare minimum. The mind to plan for emergencies. The perseverance to hunker down for the cold winter.


Not too far in the future, people would be writing about running a Covid simulation against your portfolio to see if it will survive, like it is “normal thing” to do. The FIRE community will be even more resilient than it ever was when this episode is over.

2008 Panic Selldown

Current panic sell off is quite similar to 2008 GFC. Investors are fearful that Reit may not able to refinance. In my opinion, Interest Cover ratio > 4X and low gearing are very important. Read on...

An exerpt from Bobby Jayararam REIT. book....

Panic sell-down (2008-early 2009).

By late 2007, the sub-prime crisis in the United States had started and tremors were being felt across the world. The capital markets where companies go to raise financing were frozen as no one wanted to lend; everyone’s focus was on conserving cash. Enough has been written about this financial crisis and I will not spend time rehashing all the events. What is important though is to understand that the financial panic had a particularly strong effect on leveraged investments such as REITs. Let us understand why.

The lifeblood of a REIT is the ability to produce financing at reasonable cost. Hence, any turbulence in the credit market will have a strong impact on the financing ability of REITs and in a worst case scenario (if the liquidation value of its properties is unable to cover the loan cost) may lead to bankruptcy.
Singapore REITs had also made heavy use of CMBS loans during the boom period from 2005 to 2007.

This market virtually shut down during the crisis, and the REITs had to approach banks to refinance the maturing CMBS loans.

Other than the financing issue, the financial crisis was gradually starting to affect the real economy and lead to a full-blown recession. People were starting to spend less, companies were downsizing and manufacturers were slowing production. All of this directly affected the business of REITs. If customers shop less in a mall, the shops will have difficulty paying their rentals and retail REITs such CMT and FCT would face an increase in bad debts when tenants are not able to pay their rentals on time. If companies downsize heavily, there will be fewer tenants for office space and office REITs such as CCT will face high vacancy rates.

To sum up, REITs were facing the perfect storm. They were confronted with the risk of not being able to refinance their loans on maturity plus the likelihood of slowing revenues from their properties which would put at risk the REITs’ ability to service their debts and pay dividends t unit holders. There were no precedents for such market conditions and panicky investors were starting to question the fundamental business model of REITs and whether they would survive the crisis.

By early 2009, the market was pricing in a bankruptcy for many REITs and investors were taking action by hitting the “sell” button hard! The “great Singapore REIT sale” had begun with many excellent REITs selling at double-digit yields (the lower the share price, the higher the yield).

The sale was, however, short-lived. By mid-2009, instead of the bankruptcies bad debts and fire sales of assets predicted by doomsayers, the REITs actually mounted a fierce rally! S-REITs proved much more resilient than was initially thought. During the crisis, not a single major S-REIT suspended it dividend payments (SaizenREIT, a Japan-focused REIT did temporarily suspend its dividend payments). There were no forced liquidations or bankruptcies rather. Why?

The most important factor was simply the quality of the assets. Many REITs had high-quality properties in good locations that had a proven ability to generate cash through good and bad times. Mall, office and industrial tenants had experienced several booms and bust cycles and knew the right measured to take to weather the crisis. The REITs were also highly proactive in supporting their tenants with appropriate marketing efforts. As a result, no tenant defaulted on rentals, nor were there high vacancy rates or premature lease cancellations.

Secondly, the REITs had acted swiftly to shore up their balance sheets and reduce gearing. This was done through raising equity via right issues and bank loans. Many investors were not happy with the dilutive nature of some of these issues but immediate disaster was averted.

The market had also underestimated the ability of the REITs to refinance their loans at reasonable interest rates during the crisis. CCT and CDL, two REITs heavily exposed to the deteriorating economic conditions, refinanced $580 million and $350 million on reasonable terms in the first quarter of 2009, during the depths of the financial crisis. The banks appreciated the resilient earnings power of the REITs’ assets and the strong sponsors of these REITs provided additional assurance.

All of the above meant that while many REITs lost more than 70% of their market value during the sell-down, their businesses were running pretty much as usual. Occupancies were stable and tenants were paying their rentals on time. Hospitality REITs such as CDL suffered from temporary reduced tourist arrivals but had no issues servicing their debt (they generated enough cash from their businesses to make interest payments to the banks or bond holders). Most importantly for investors, all REITs continued to pay dividends on time.

This indeed speaks to the strength of the assets of most REITs. Other than having to undertake dilutive right issues, the REITs came through the severe crisis in fairly good condition. Their share prices had been hit, but not their operating earnings and ability to pay dividends. Investors should do well to remember this.

There is no denying that the crisis was a great learning experience for both investors and the REITs.
Investors that were banking on the stability of REITs versus other equities were shocked to see REITs fall even harder than the rest of the market. Between June 2007 and December 2008, the REITs index fell more than 66%, as opposed to a 50% drop in the STI. A major reason for the severe fall was that in 2007, many REITs had simply become too overvalued (as described in the 2002-2007 bull cycles). Investors also learned to differentiate between different REITs and were awakened to the 21
important of resilient assets, financially strong sponsors and competent REIT managers.

It is hoped that they also learned not to panic in the next crisis. Despite the sharp share price drops, investors who had held on to good REITs and did sell during the crisis sailed through just fine as they collected dividends throughout the crisis period.

Meanwhile, the REIT managers learned their own lessons about leverage, the excessive use of short-term financing and the need to have diverse sources of funding. Once more they were reminded of the need to exercise restraint in a booming property market and not overpay for acquisitions and extrapolate current rentals into the future.

Black Monday

This post is to commenerate the largest single-day drop in portfolio of my investing journey so far, and the largest absolute number single-day decline (-178 pts) in the STI history.

Even though I went through the oil crisis of 2015, my portfolio was relatively small back then. Like maybe 50k. A 20% drop back then was a mere $10k, nothing more than a couple of months of salary.

Not today. My stocks portfolio have since grown immensely and the daily swings are simply insane (plus minus $5k daily). This is really my first bear market, the first real test of my nerves.

A test of whether I have the stomach to stick to my investing principles and every long-term investing knowledge I have learnt. Every investing article, every warren buffet advice, every financial principle - it is useless if I do not execute them and capitulate like the herd. There is no use "fighting war on paper". 

This could be the once-in-lifetime opportunity to buy stocks for very cheap, and I count my blessings that I still have a substantial cash warchest to average down.

People who kept saying that cash is 'wasteful' and 'low returns' have come face to face with a bear before. The "psychological defence" it provides is invaluable and cannot be measured in dollars alone.

Here's what I have to constantly remind myself:

For my various speculative stocks, there is nothing I can do now. I guess it is a lesson learnt and I might just have to write them off if they don't rebound after the crisis.

For most of my holdings I am very sure they are excellent, solid companies. Why do I care if they crash 10, 20 or 30% today? 

I am not selling . I am looking to buy and hold good companies for the next 20 years.

I am STAYING THE COURSE

“Bear Markets: When stocks are in a Bear Market (U.S., International, or both), you will be strongly tempted to sell at least a portion of your stock funds. DON’T DO IT. This is the time when stocks are on sale at lower prices. Sticking with your allocation means you likely will be buying low and selling higher when you rebalance – the opposite direction of the herd. Rebalance by adding to your stock funds until you have again met your desired asset allocation. This is the most difficult (but most important) thing you can do in a Bear Market.”

So...

How much did I lose in ONE SINGLE DAY?

$13,500

Year In Review 2019 - Annual Financial Report

Presenting 2019 Annual Financial Report! (Yes, it's late and Wuhan virus is now wrecking havoc! Neverthless, we are sticking to what to know as of early Jan)


Key Highlights & Notes From CEO

"Work Hard Now, So We Don't Have To Work Hard All Our Lives"

"When you save for the future, you actually allow yourself to live in the moment.

Most people get this completely backwards. They live in the moment, which kills their ability to save for the future (aka YOLO). My plan is to flip that script. By sacrificing a few years when I'm younger, I am building a financial foundation that will last a lifetime."

This year marks the 3rd into the new job and it could be a good time to move on. We broke some significant financial milestone this time:

Financial Milestone (2019)
1. Passive income enough to cover all basic recurring expenses
2. CPF Met the Full Retirement Sum of 2019

Achievements (2019)
1. Total net asset value grew 21% despite topping up $7000 to CPF-SA
2. Annual saving rate of 78.9% (80.8% in 2018, 80.5% in 2017, 78.2% in 2016)
3. Safety passive income now cover 65% of our recurring expenses
4. Portfolio market value grew 20% (inclusive of capital injection and gains)
5. Portfolio XIRR for 2019 at 14.23%
6. By Pay-Date, distributed over $8300 worth of dividends ($7800 in 2018, $4900 in 2017)

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Income Statement (2019)
Total income was merely 2% higher due to the huge bonus cuts.

Passive income growth was only 7% after selling M1 and Capitamall, and most new dividend stocks were brought later in the year. We also suffered from saving account interest cuts among the various banks.

Expenses were about $3000 higher with the signicant ones being:
1. Higher income taxes
2. Genting Dream Cruise vacation in Feb
3. Taiwan trip in Apr
4. Takeover of all insurance policies
6. Birthday angbao to parents (Same as last year)
5. Samsung Galaxy Note 10

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Balance Sheet (2019)
Survival Burn Rate = Recurring expenses needed for essential survival
LEAN FI Rate = All expenses needed to maintain our current lifestyle
FI Rate = Lifestyle with built-in buffer that we want to achieve in Financial Independence

While the red-line grew significantly, yellow and green line remained flat thanks to much higher discretionary spending.

Our goal remain the same - to exceed 25 years for the yellow line by year 2021.

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Recurring Expenses Breakdown
Categorical expenditures remained pretty much the same as every year. Top expenditures were the essentials - food, travel (transport) and utilities (internet and phone).

Random discovery time!

1. Lottery spending was around $250 (Almost $100 lesser than 2018). Won 1 single Group 6 of $10.

2. I ate fast food 60 times (64 in 2018, 70 in 2017, 81 in 2016), counting only lunch, dinner, supper. Managed to meet my goal (right on the mark!) of cutting down fast food. I think this is as far as I can go for now.

3. I brought 48 (22 in 2018, 11 in 2017, 31 in 2016) cups of Bubble Tea this year, much more than previous years. This is due to... influences from BBT loving colleague. Haha.

4. I brought 17 cups of Cafe drinks (4 last year), similar to reasons above.

5. Visited restaurants 37 times (32 in 2018, 20 in 2017). My most expensive single trip restaurant is $37.

6. Only 5 KTV (10 in 2018) sessions for the entire 2019! (Excluding JB trips)

7. 13 Taxi/Grab trips this year, spending less than $150.

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Portfolio Performance

An exceptional year where we beat the index handily.

This year, we injected almost $40,000 into the stock market (STI, Sembcorp Industries, Eagle, F&N, Capitmall Trust and Accordia Golf Trust).

Year	Portfolio	ES3
2014	-2.94%	7.00%
2015	-8.17%	-10.95%
2016	11.97%	2.69%
2017	22.00%	20.68%
2018	-10.40%	-7.43%
2019	14.01%	8.78%

Our biggest losses remains Kimly and Sembcorp Industries, offset by the insane REIT rally.

Excluding the STI, we have a healthy and diversified portfolio of 12 holdings (up from 11 last year and 10 in 2017).

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Review of 2018 Goals
Missed our goal of hitting $10,000 dividends due to the insane market rally (no chance to buy the good REITs at all!)

Outlook For 2020
We will continue our core strategy of building up a divesified income portfolio backed by index foundation. We are more than 10 year into the bull-run and the music got to stop one day.

Once again, our ammunition have replenished entirely after December, and would fatten even more in March. Hopefully we have opportunities to deploy them before the dividends season come in Q2.

We will be bring forward last year goal to exceed $10,000 worth of dividends - hopefully we get some Great Singapore Sale.

There is a good chance of a income source switch which would definitely have impact on revenue. For now, we would let nature take its course.

Long Term Goals
Our long term roadmap remains the same - And this year marks the year we intend to diversify into more global markets. Although I am personally confident in Singapore, I still could not risk placing all our money in 1 basket. What if we experience a lost decade like Japan?

- Open Interactive Brokers Account (Start with DCA and within 2 years grow it to more than $100K USD when we can enjoy $10 platform fee waiver)
- Indexing World ETF via IWDA + EIMI (Can it drop below $50?). Both ETFs automatically reinvest dividends (i.e accumulating units).
- Indexing for China via Heng Seng Index (HK 2800). China growth in the next 20 years should be immense.
- Local portfolio reached substantial size to start lending shares for extra income

5 Year Masterplan:

Year 2020: Start diversifying into global markets.
Year 2021: Reach "25 Years Expense" Networth.
Year 2022: Eligibility to buy HDB.
Year 2023: Passive income completely cover all-expenses. Save 100% of salary annually.
Year 2025: Financial Independence.

Rationalizing Affairs of the Heart

Although this is still painful, I am grateful for this experience - the pain is short term but the lessons learnt are lifetime. I feel that in the long term I would be a much better person because of it. Someone who is more observant and more initiative.

That aisde, my friend have helped a lot in rationalizing all this, and after thinking about it, I have also come to my own reasons to get over this.

And I think it is super important to write this down, to help me get over it now and to remind me of it in the future.

Now, if I really want to stop our friendship forever and cut off all contact, I would rationalize this whole event with the most negative things about that person, like:

1. Fickle-minded
2. Trying to lead people / laying a trap with false signals
3. Attention-seeking / enjoy the feeling of being pursue by many people
4. Something much worser that I cannot even bring myself to write it here (who would do something like that?)

Now, I do not like to think the worst of people, and I genuinely think she is not somone like that (at least at this point of time).

Even I am confused about what I am feeing, what more someone who is so young? So, I prefer to rationalize it as:

1. She is confused about her own feelings (towards me and others)
2. She is immature / trying to fill some kind of void in her life.
3. She legitly felt obliged to keep to her word.

...

Ultimately, does it really matter?

Action speaks louder than words. She may say one thing. She may keep crying. She may say she regret things and claim she has more feeling for you.

But no matter what was said, the choice she made in the end speaks for everything. 

It does not matter how much a person say she likes you. The fact that she did not choose you in the end already says everything.

At worst, the feeling wasn't there in the first place (and she is all the type of person described above). At best, the feeling wasn't strong enough for her to choose you.

So, what more is there to hold on to?

:)

I felt much better after writing this post.

Complex Emotions

Isn't weird how we can confuse feelings of:

- The Love of genuinely liking someone
- The Regret of a missed opportunity / sense of loss
- The Fear of being alone

Yes, emotions are complex - they are not binary and they are not stand-alone. That makes it difficult to evaluate them in a vaccum.

But sometimes it is really a 当局者迷 kind of thing... you really need someone who have been through this to offer a different perspective, especially when you are someone who is not constantly 'in the game'.

Really happy to talk so much with a good friend for an entire evening. Super thankful for his advice and sharing of his own experience.

Felt so much better and relieve.

Somehow I already feel that I am on the way to getting over this.

Killing My Other Self

Sorry I had to ignore your messages, because anything you do for me now will simply make the ZZ that likes you stronger.

He is no longer wanted nor needed in this world, so I had to do what I can to kill him. 

Everything within my power.

Everything I can. 

He is fking strong. So strong. Much stronger than I thought.

He wakes me up in the middle of the night, when I have having lunch, when I am using Whatsapp, when I am at office. When I am doing fking anything.

He is ripping my heart out and shattering it. He is making me cry, making me feel like dying.

Everytime he comes out, I need to stab him without hestiation.

Each time he show himself, I must show him no mercy.

Give him no chance to build momentum. Give him no chance to linger. No chance to grow.

I don't know how long it will take, but I will kill him.

Even if I can't, I would knock him into a coma forever.

Once he is dead, I can look for and bring back the ZZ that is your best friend.

https://www.youtube.com/watch?v=k0GQSJrpVhM

Letter To Shareholders (17) - Performance Review 2019Q4

Operating Updates

The biggest bombshell this quarter was the unexpected amendment to Citibank Maxigain, which took me by surprise. It was a huge blow to my safe passive income as it dropped from "0.8% of SIBOR + 1.2% Bonus" to "0.5% of SIBOR + 0.6% Bonus".

It is atrocious that they dare sent a letter saying all other "features" of Maxigain account remains unchanged. Yes, all the negatives you mean, like "not being able to withdraw". 

I should have seen this coming (though I did not expect such a big change so quickly after the last). I threw the chance to enter SSB when it was at near 2% for 1 year interest and can only regret now, haha... the rate has since plummet to 1.5+% for 1 year and 1.7+% for 10 years.

Nonetheless, closing this account (on 2nd Dec 2019) meant freeing up a huge stash of ammuntion that has nowhere to go. With DBS Multiplier max-ed out and CIMB Fastsaver giving only 1%+... it was a huge headache.

After much deliberation on available options:
1. SSB at 1.5+%, pro-rated interest and withdrawable anytime.
2. CIMB Fixed Deposit at 1.7% for 3 months.
3. Stashaway Simple at 1.9% (projected).

I finally settled on 2 remedial action.

Action 1 - Topping Up CPF
Yes, I finally did it. 

This is something I have been contemplating for the past few years but never had the courage to do. Even up till the point of pressing "transfer", I still have this "sinking" feeling that I am transferring $7000 that I would never see again in my life... Still, logic won over the heart in the end. A huge reason for this is I am single and do not have someone to leave a legacy for in the future. Otherwise, it would be a much easier choice (i.e if i have a kid I would definitely top up).

For the past few years, I had Maxigain which gave me near 2.5% interest, almost as good as CPF-OA. It was a huge 'deterrence' for not making top-ups. Now, a combination of factors made me pulled the trigger.

1. The yield between the "public" risk-free rate and CPF has widened much more.
2. There is a limit cap on those with better interest.
3. Stock market (especially REITs) at all-time high and compressed yields.
4. Accumulated decades of emergency funds and my passive income can now cover all basic expenses. This means much less chance I need to tap on the cash.
5. Basically met FRS, which means I can withdraw the money at age 55. 
6. Might as well earn some tax-relief.

Anyway, the topping-up experience was much smoother than I expected - near instanteous and the contribution appear on my statement immediately! Cool!

*Tip: Top up near the end of the month as CPF interest is calculated based on the lowest balance of the month. It means you get to earn interest elsewhere for that 20+ more days.




Action 2 - Hacking DBS Multipler Using Insurance
Coupling the "1st year 35% discount" promotion and "Insurance only recognized for the 1st year" clause makes advancing to the next tier a no brainer.

The way I see it, I am paying $7+ per month in order to get higher interest for an extra $50K.

Assuming a very conservative 1% higher interst, that is $500 more per year which is $40+ per month. Deducitng $7+, I am still gaining $33 more income per month. And that is "at the very least".

In good months where I can clock the highest tier, it can amount to about $100 more! Which means, 1 good month and I would have more than pay off the entire year of insurance cost.

Yum yum!

(Note: This was written before DBS Multiplier announced change from Feb 2020. We will have to see how to mitigate the impact)

Performance Review Highlights / Acquisitions & Developments
Many actions this month: Averaged down on EHT, brought F&N, Capitamall Trust and Accordia Golf Trust (gambling on its acquistion deal)

Overall, our portfolio recovered strongly (nearly $10K from capital gains alone) thanks largely to Singtel and various REITs. 

Total dividends for Q4 stand at $1100, slightly lower than last year's $1200.

Operating Highlights - Income
Salary and total income took a big hit due to the much reduced bonus (essentially 1 month lesser). I think many did not expect it to be this bad.

We earned some $500+ side income from multiple sales on Carousell (as part of my journey towards Minimalism), birthday gifts and long service award.


Operating Highlights - Expenses
1-time expenses were higher thanks to higher income tax and Samsung Galaxy Note 10 (purchased on the last day of the year!) to finally replace my S7 which I have used for 3 years!

Regular expenses are in-line, but is definitely inching towards the higher side now. I forsee this trend to continue as I continue to indulge in Starbucks, Tiger Sugar, Boost Juice and generally nicer food ($10 to $15 for lunch) more frequently. 

Outlook

More to come in the annual report.

Side note: Layers Senpai has a really good series summarizing 1 of the best investing book : Little Book of Value Investing