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
$10,135.41
$13,814.52
$23,949.93
Percentage
42.3192%
57.6808%
100%

31 December 2014  Stocks  BondsCashTotal
Amount Contributed
$0
$8,063.02
$15,886.91
$23,949.93
Percentage
0%
33.67%
66.33%
100%

- 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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