Monday, January 12, 2015

[XMM STI ETF Investing] December 2014 Update and Year Review

As mentioned previously, this will be my attempt at having a monthly update of the small portfolio that I am running for my sister and mother. The aim to have as little downside risk as possible, and maximize returns from there.

No changes to the portfolio this month, I am still playing it safe because the STI doesn't seem to offer any very compelling entry points yet. It looks fair valued, but I just feel a buying opportunity coming around soon.

Here are the current stats of the portfolio as of end December 2014.

31 December 2014       Sister             Mom               Total       
Amount Contributed

31 December 2014  Stocks  BondsCashTotal
Amount Contributed

- Bonds are in UOB SGD Fund Class A with 4731.82 units.
- Cash is earning 3.05% from filling up the remainder of my OCBC 360 account.
- Additional $500 was added to Cash.

This month in December is actually the only month that my bond portion has actually decreased MoM. However, Cash is still giving me a good risk-free rate because of OCBC 360.

Since 1 April 2014 until now, my simple returns on cost is actually 1.06%. However, this amount is actually understated, because I did not calculate the time-weighted returns and that would have been higher. But oh well, I am way too damn lazy to calculate it. My sister managed a simple return of 1.35% on her cost, while my mother had 0.84% for the year.

Returns for next year will be must more optimistic considering that the bond fund was busy paying off its sales fee and only made about 0.75% for the year which it will not have to do in the future. I will most likely be running out of space in my OCBC 360 account as I near the $50k limit myself, which means I must find this cash another good yielding alternative. I will likely lock up some cash under the 6 month POSB fixed deposit promotion that I applied for in December, while I think of an alternative. The CIMB StarSaver is looking like a real good candidate now.

I will also think about rebalancing the portfolio allocation and move bonds back up to 40%. I think a 40/60 split between bonds and cash is a good "war chest" allocation, especially since I highly suspect that 2015 will have an opportune time for me to pick up some lots of the STI. 2014 did not even experience a 10% correction the whole year, so just simple probability is telling me that there will be an opportunity soon.

I'm looking forward for a good 2015 to show my family that prudent investing can reap decent outcomes, especially if you are patient and not in any hurry.

1) Calculate end of month stocks / bond / cash value, update both totals
2) Times by contribution percentage to find end of month value of each contributor
3) Add in $400 to both totals
4) Recalcuate new percentage of contribution
5) Recalculate new percentage of assets

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