Tuesday, September 15, 2015

[XMM STI ETF Investing] August 2015 Update

It has been quite a while since my last update. I have been updating on my spreadsheet monthly, but I always forget to post up my 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.

Here are the current stats of the portfolio as of end August 2015.

31 August 2015       Sister             Mom               Total       
Amount Contributed
$10,321.20
$18,288.89
$28,610.09
Percentage
36.0754%
63.9246%
100%

31 August 2015  Stocks  BondsCashTotal
Amount Contributed
$891
$10,246.05
$17,473.04
$28,021.80
Percentage
3.11%
35.81%
61.07%
100%

- Stocks are in the STI ETF (ES3.SI) with 3 lots.
- Bonds are in UOB SGD Fund Class A with 5902.1 units.
- Cash is earning 2.25% from filling up the remainder of my OCBC 360 account.
- Additional $600 was added to Cash.


Starting May 2015, the OCBC 360 account now only gives 2.25% interest. This is unfortunate, but it is still the best cash option for me.

Returns for the rest of this year should be quite optimistic considering that the bond fund was busy paying off its sales fee last year (they have since removed the sales charge for that particular bond fund, grrr). I will most likely be running out of space in my OCBC 360 account as I near the $60k limit myself, which means I must find this cash another good yielding alternative. I have opened up a CIMB StarSaver account which yields 0.8% in preparation of this.

I have rebalanced the portfolio in January of 2015 to have a better portfolio allocation between bonds and cash. 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. Very very soon.

I have begun following my STI ETF Playbook, which is a mechanical strategy to help me overcome emotions and to buy more stocks as the stock market falls. It's not a scientific method at all, but it follows the basic principles of value averaging which calls for buying more when the price goes lower. In the month of August, I have already hit the 10% and 15% trigger, so I currently hold 3 lots of the STI ETF.


Of course, I don't want things to be so strictly mechanical, so on top of this, I may opportunistically invest the fresh cash added each month into the STI or even liquidate my bond holdings if the opportunity really is very tempting.

The goal is to average down without being too kan chiong or humji, so I think the base case would suit me fine to help me dip my toes into the STI at increasingly safer levels. That's right, the lower the STI falls, the safer it is to invest!

No rush at all, really. Steady she goes.

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