2018: A year in review

Thought I'll do a review of 2018.

On my own personal finances  
Achieved investing savings target of 24k/yr, actually achieved 35.6k.

This excludes funds diverted for a side venture of mine (it would add to 38.7k including all the SG bonus, refunded insurance premiums, etc).

Had kept my expenses as low as I could, seems like focusing on how to allocate every dollar well seems to be working.

Creating a future expenditure budget and planning on expenses in advance (by deducting as a monthly expenses) seems to be working well too, though I have spent a bit more this year, so I would look to increase my expenditure budget after increment next year.

This year I managed to increase net profit margin from work from 56% to 57.7%, it is still not yet at the 60% mark.

Happily, I am also pleased to say that my net worth less CPF has managed to exceed the CPF OA+SA balance (140k), but still less after the CPF MA is added.

I have terminated my ILP to raise more cash for my portfolio and bought a MINDEF Aviva Personal Accident Plan. I will see if I need to topup my term coverage with the MINDEF Term Life if needed in the future.

Applied for 2 credit cards in hopes of using them for my side venture plus balance transfer to get a few months of savings in advance to grab opportunities when they present themselves (kinda like a few months savings advance).

I have managed to reduce Grab/Taxi expenditure as much as I can by scheduling my time better or just looking to do some stuff on the go.

On my Investment Portfolio

Portfolio XIRR this year is about -23% which is rather terrible, the recent downturn made all my counters fall to 5 year lows. Makes me wonder if I am doing the right things. Fortunately, my XIRR since I started in 2014 is 0%.

Total Dividends Collected in 2018 is at 3125.86 (I have not included Singtel upcoming dividends as it would be paid next year).
This makes up $260.48 in dividends per month :) (increased from last year)
Hope I can keep it up, maybe boost it with some option premiums :)

This covers about 15% of my expenditure.

Still some distance from my first port of gold, so hope to get there soon! Hope to hit 150k portfolio in about 3 more years (from Cai Haoxiang article here), which currently I am on track, fortunately.
That being said, it has grown from the prior size of ~54k to the current ~105k less debt (including would be 114k). There was plenty of buying opportunities this year reducing my cash balance to 8%.

I am kind of behind in my watchlist numbers population due to working on my side venture (doesn't help that I am back to the drawing board), so I'll probably look to purchase what I already have looked at (list keeps increasing). There's still a lot more work to be done. :(

Some highlights

• Experimented with credit card balance transfers twice and seems to be fine. However, it would be expected to reduce in effect as the size of the portfolio grows larger. Perhaps only as an advance in salary. Moving forward, perhaps Maybank REIT Financing account would be useful.
• Sold some Put Options as a fancy buy order and collecting premiums while waiting. It seems that Support/Resistance do help somewhat but I'm still collecting data on Option Greeks to see if I can identify similarities.
• Attended a couple of AGMs as part of continuous learning in hopes of making myself better as an investor
• Initiated a trade to short NASDAQ via an unleveraged Inverse ETF, time will tell if it is good. Good alternative to short without borrowing shares targeting at the broader market.

I have made my fair share of mistakes on hindsight, such as perhaps buying into counters a little early (Singtel just before XD, Facebook after a short plunge by the scandal, etc) and perhaps adding Facebook (the costs of security if they can fix it as well as being my first foray into tech). Hope to do better next year

Some thoughts of 2019

• I feel a economic slowdown and perhaps a recession will hit us, hope I am prepared sufficiently
• Target to increase my portfolio size to larger than the combined sum of CPF OA+SA
• Spend more time to read more annual reports so I can read from the first one to the most recent one to get a better feel of the business.

For those of you who wanna see more information, my portfolio is on StocksCafe, you can find it here.

On my CPF
My CPF SA is ahead of my projection schedule, currently at 79.4k (still waiting for the funds in my PSEA account to come in, so it can be transferred to SA). A fun thought is that the combined balance of the OA+SA is 140.8k which feels much closer to the Full Retirement Sum. Another is that I would be able to hit FRS assuming no increment at age 50 with purely the SA alone.

Seeing the CPF interest does make me feel happy in this downturn.

My stance on OA is still the same as last year, I might look at investing my CPF OA money with the same strategy as I am using with my cash, but probably focused on dividend growth counters (probably only 1-2 shares).

I currently have 24.5k that I can invest, perhaps in 2019 I should open a brokerage account to link my CPF.

I saw a friend B topping up his CPF for tax relief recently as well, perhaps I should look at topping up should my income bracket rise, or perhaps just put it into the SRS.

On my job
I have been recently rotated to an office role to further develop myself however, this came as an expense on the loss of certain shift allowances. I do enjoy learning but it is rather taxing and tiring (I'm still more used to shift hours).

In addition, my company has been cutting OT (despite an EBIT margin of 50%) and the pipeline of customers maybe be reducing in the years to come.

I tried to compensate by saving harder but it does remind me the importance of creating multiple streams of income to diversify from concentration risks in income (investing we call it key client risk). I would target to increase my savings rate excluding night shift allowances to at least 60% (currently 57.7%) as a precautionary measure, and hopefully post night shift allowance to be 65% (currently 58.1%).

Some downers in addition to the above are also reading this article: https://www.businesstimes.com.sg/government-economy/pharma-manufacturing-in-singapore-gets-s34m-boost, which highlights the worrying trend of potential disruptive technology as well as some adminstrative stuff such as no vouchers.

Hope I get a promotion or good increment next year, as bonus would be reduced due to bad performance of the site this year.

I have been recently adding a metric to my own KPI assessment as well, which is Income CAGR to monitor my own relative growth rate. Although we have to agree that eventually we would revert to the norm, but as I would model myself after companies, using Damodaran's idea of the life cycle of companies, something like the chart below:

I would still be in the growth phase so have to seek catalysts and areas of growth.

As of present, my income CAGR since I started working in 2011 is 13.61%, but post degree CAGR is only 9.43% (note that I do not count bonus, just salary+allowances+AWS, as bonuses are variable).


On my personal life
I managed to complete 12 books, including 1 fiction book, meeting my target of 12 books per year. I barely made it so I think my target next year would still be 12 books per year.

The list of books read are:

1. Digital Gold by Nathaniel Popper
2. REITs to Riches by Tam Ging Wien
3. The Ultimate Guide to Real Estate Investment in Singapore by Ismail Gafoor
4. Buy Right Property by Getty Goh
5. Multiplication strategies in real estate by Tracy Goh 
6. Buy Bye Property by Getty Goh
7. PEACE Investing by Tracy Goh
8. Timing the Property Market by Mr Propwise
9. The Personal MBA by Josh Kaufman
10. Silent Sales Machines by Jim Cockrum
11. Domaining Guide by Jerome Robertson
12. Tai-Pan by James Clavell

The memorable ones would be The Personal MBA, more insights into companies and self improvement, and Tai-Pan, a fiction version of the Jardine Matheson family, makes me wanna read the actual history book on it. The book Asian Godfathers last year did give me rather large interest in reading about how all these billionaires and tycoons got to where they were now. Made me lose respect for many of them as well.

My To Read list keeps piling up, I hope I would be able to read them all. I hope Salvatore releases the last few books of Drizzt so I can read the whole series at one go :)

Let's see if I can complete Damodaran's lectures on Valuation and Investment Philosophies in 2019 as well.

On a side note, I finally finished a game this year too (1 last year)!

Games list:

• Hand of Fate 2 PC

There's some matters that make me think again about the fragility of life as well. Hope it turns out well.

Well, let's look forward to 2019 and make it a better year for ourselves :)

How was 2018 for you?