A rising number of individual investors are taking a more hands-on approach to managing their assets. Curious about what other investors are holding? Here’s a peek into the investment portfolio of chartered financial analyst Calvin Yeo, who has over a decade of experience in value investing.
Words by Calvin Yeo
I started investing in stocks and fixed income instruments in 2003, before shifting my focus to real estate and dividend investing for passive income in 2008.
When it comes to investing, I like a combination of two strategies: value investing and income investing. I invest in assets which produce income, and I try to buy them when they are cheap or undervalued.
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The reason why I prefer income-producing assets like properties, stocks and bonds is because they produce cash flow. Without having to sell the assets, you continue to make money year after year. And that’s important because you can compound cash flow over time. Over many years, compounded returns can become a lot more than the sum of returns.
Today, I’ll be sharing what my investment portfolio looks like currently, with a focus on Singapore stocks. My last portfolio update was a year ago; you can see it here: My Singapore Stock Portfolio April 2014
These are my SGX stock holdings as of April 2015:
As we all know, oil prices have fallen for some time, and with every downturn comes a bargain hunting opportunity. I started accumulating Keppel Corp at below $8.50 and Semb Corp at around $4.30. Keppel Corp and Semb Corp are both conglomerates that have diversified businesses other than rig building. I also got into Nam Cheong, which is at an all-time low of $0.305. If you’re interested, you can read about it here: DrWealth’s Stock Review: Nam Cheong.
Other than oil-related industries, crude palm oil prices have also been affected and palm oil companies have taken quite a beating. I picked up both Bumitama Agri and First Resources at about $1 and $1.80 respectively. Both are relatively young plantations, as I’ve pointed out in this analysis: DrWealth’s Stock Review: Bumitama Agri. I sold Golden Agri as the plantations are older, and moved all the positions into Bumitama Agri and First Resources instead.
Other recent transactions include OSIM at about $1.90 and Overseas Education at around $0.79. I like OSIM due to decent profit margins, good cash flow, and also pretty good growth. Overseas Education has fallen about 20% from the peak and has decent 3.5% yield and 14x P/E. It has competitive tuition fees compared to other international schools and has decent margins as well as good cash flow.
I also find the TWG business especially attractive and well-executed with ROE at about 24 to 25%. I have been accumulating since the price went below $2, which is about 14x P/E and 3% yield.
I sold Comfort Delgro, Q&M and Silverlake partially to take profit as prices have risen dramatically and they are looking pricey. However, business fundamentals still look good and I remain committed for the long run. I got rid of Vard as their execution problems seem endless. It’s a good thing as the stock has performed even worse since then.
I’ll just cover these transactions briefly, since they are quite some time back and the prices have changed. I bought both Sheng Shiong and Dairy Farm last year due to attractive prices, and because I generally like the consumer supermarket business. Sheng Shiong has really good growth and strong free cash flow, while Dairy Farm is the king of supermarkets in Asia.
For the first time ever, I will be publishing results for my stock portfolio! This is all made possible with the DrWealth platform, which you can use to track returns for free. I have been using it daily for some time, and the process has been a breeze. No more dealing with Forex differences, and the best part is: no more manual entry of dividends. If you’re looking for a convenient way of tracking your portfolio’s performance, you should definitely try out the app.
I have tracked my portfolio against the STI, as this is an all SGX portfolio.
The one-year performance is about 21%, while STI returned 7.7%. Pretty decent outperformance.
The three-month returns is about 8%, while STI returned around 3.1%. Again, I am quite happy with the results.
Finally, let’s have a look at the overall asset allocation.
Bear in mind that this is just for my SGX portfolio, and not my entire stock portfolio which includes US, European and Hong Kong stocks as well. About 45% of my investments are in REITS and the rest in stocks.
This article originally appeared on Calvin Yeo’s blog and has been republished here with permission.