Monday, January 1, 2018

Happy new year 2018 and review of 2017

Happy new year 2018!! Time flies! With a blink of an eye, another year has passed (just like that). And its time to do another stock take and reflection for the past year 2017.

Year 2017 was a surprisingly bullish year. Many have predicted that given the year ends with a "7", there would likely be another financial crisis/stock market correction (like in 2007, 1997 etc). However, it did not materialize at all! Instead, the local stock market did very well for year 2017, with the STI rising 18.1 points to close the year at 3402.92

The US market also did very well, with the American stock market (DJIA, NASDAQ, S&P) soaring to new highs. This is probably attributed to the passing of the tax reform bill by the US Congress and the general improvement in the state of the US economy with unemployment declining. All in, the passage of this tax reform bill (and the improvement in the American economy) would benefit many counters listed on SGX with American operations such as Manulife REIT.

Whilst the American stock market is soaring high, the American President Donald Trump approval rating is not doing so well. The Republican party lost some electoral contests in Alabama, Virginia and New Jersey and might be in for a tough mid term in November 2018. But then again, I am not sure if it is a cause for concern as history has shown that the American people favour "check and balances" i.e. different people controlling different branches of government. On a side note, this is also the year where I got quite disillusioned with local politics and politician. With all the bickering and manipulations...

This is also the year of crypto currencies. Bitcoin, Ethereum etc have been soaring really high, with many newly minted Bitcoin millionaires/billionaires. I have no positions currently or previously in crypto. Personally, I think it is highly speculative, but I shall reserve my comments ;)

Okay, enough of ranting about global affairs, now on to the personal front. For my personal investment, I think I did pretty alright overall. Not as spectacular as last year, but it was a decent performance. As I trawled through the other blogs owned by other financial bloggers, I think the general sentiment was that 2017 was a good year for most, with many investors making good money. Congrats to all! Below are my performance results :)

My Portfolio 
(inclusive of capital injections)
My Portfolio 
(less capital injections)*
+11.7 (annualized)
-0.8 (annualized)

In 2017, my portfolio grew by 66.6% to reach yet another record high! When corrected for capital injections eg. from salary, my portfolio would have grown by 57.7%. This is a difference of around 9%, which is not very much, which probably reflects the fact that my portfolio is pretty sizable and that my employment income accounts for only a small proportion..

Year 2017 was also the year when I officially graduated from university and attended my commencement ceremony! I also took on CFA Level 1 and passed it (on my first attempt)! Yeah! :) And won some award/competition in the first half of the year! Yeah Yeah!! :) And I saw beautiful Cherry blossoms in Japan :)

I found and embarked on my new job around the middle of the year. To be honest, work has not been easy, having to manage work relationships with colleagues and clients. It has also not been easy juggling my investment (which is very sizeable vis-a-vis my employment income). I probably made more than five times more from my investment returns than my salary. Work has really taken a toll in me and I feel really stressed, burned out at times (and this is only half a year into my job).

Also, whilst I have managed to grow my portfolio by 66.6%, I daresay the bulk of my investment gains were generated in the first half of the year (when I was still not employed full-time). The second half of the year was pretty flattish. Whilst I made some really great profits in the second half of the year, I also made some mistakes which caused some sizable losses, making my investment performance in the second half of the year really bleh...

It was also not easy getting time off to attend events organised by listed companies such as AGM/EGM as the dates for such events are usually announced less than a month before. And by right, according to company policy, leaves must be applied at least four weeks in advance.  Nevertheless, my boss have not stopped me from applying for off, although sometimes I feel really guilty leaving to attend such events whilst work piles up...

Relationships with family and friends have also not been so well. Whilst I do treat and take them out for dinner/meals and paying for them more often, I find myself losing my temper and raising my voice more readily. Many friends have gotten married, some have relocated overseas for work and I have been postponing meetups more often than not. On the personal front, I seem to being making no headway.

Going forward, I am seriously evaluating the right way forward. To this end, in the second half of 2017, I have increased the diversification of my portfolio to reduce the probability of incomplete/inadequate/incorrect analysis (due to lack of time/energy managing my other commitments) from causing serious damage to my portfolio. I daresay I currently hold the most number of different counters ever since I started investing. I have also increased the number of REITs/trusts and other companies that pay good dividend yield in my portfolio to increase the overall dividend yield of my portfolio to enable a more "passive"/hands off approach to my investment.

I also recognize the need to repair/rebuild relationships with family and friends, which have gotten more distant the past year. And also that throwing money at the problem i.e. treating meals and gifting is insufficient and quite superficial? Whilst I have made really good returns from my investment, is it really meaningful? Am I just making money for the sake of making money? What is the purpose of having good money without spending, enjoying the fruits of it all? To this end, I am seriously thinking of how to translate my investment returns into more meaningful avenues, perhaps bringing my fast-ageing parent and family for a long vacation in 2018 to spend good meaningful time together.

I guess thats enough of my ranting and back to investments. This year I attended many many AGM/EGMs, more than 15, maybe even more than 20? I think I also received record dividends (as I have increased the proportion of stocks paying good dividend yield (as mentioned earlier).

The interest from my bank deposits also increased significantly. Interest received more than doubled compared to last year due to my increased overall net-worth as well as the fact that I started using the DBS Multiplier Account, which gives up to 3.5% as long as there is salary credit, credit card spend and investment (either via CDP dividend credit or DBS Vickers share purchases). But the increase in interest due to DBS Multiplier is scant consolation imho..

Lastly, going forward, many people have done well in investment this year. To be honest, I am a bit contrarian, and I tend to be more cautious when people get excited and thrilled over their superb returns from the equity market. Hence, I will be more conscious about getting "too excited" and that STI returning 20% y-o-y is not a "new normal". Finally, given my so-so investment performance in the second half of 2017, I will be reflecting and evaluating the way forward to balance between my investment and other commitments. And also my other priorities on the personal front.

Happy new year 2018! May 2018 be a happy, healthy and prosperous one! HUAT AH! :)

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