The best time to buy is probably the worst time to sell and vice versa. Lesson was learned the hard way as both MNACT and Ascott Trust cost the fund $4k in profits when both was sold to beef up cash for the Chinese equity ETF.
While I believe the cash will be well deployed, timing could really have been better as I will avoid doing both buying and selling at the same time in the future.
The focus for the month would be to prepare the SRS fund to weather a higher interest rate environment. While banks will likely expand their net interest margin to around 2% I simply do not see this margin expanding beyond 3% as bank will eventually have to pay depositors their dues by increasing fixed deposit rates.
With the impending launch of digital banks in Singapore, competition is expected to heat up in the banking sector which will likely cap their profitability even with higher interest rates.
REITs will likely face increasing interest cost over time as they begin refinancing at a higher rates. Those with lower debt will likely out perform as the Singapore economy open up further with reduced restrictions as well as tourist contributions.
My view on REITs will be for DPU to trend upwards over the year while price maintain stable thus compensating for the higher interest environment.
SRS Fund Portfolio
There are quite a few activities during the month of March as the HS Tech ETF was a new position in the portfolio together with addition to Ascendas iTrust. Both MNACT & Ascott Trust position were liquidated. The SRS Fund value reach an all time all of $350,500.26 and a dividend of $2,197.39 was collected during the Q1 2022. Cash level remain elevated at 18% as I wait for more opportunities to deploy these funds.
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The SRS Fund Dec 2023 Update
By the end of Nov, the SRS Funds barely broke even as the struggle was real throughout the year with much volatility. Much has been rumoured about a rally Santa brings around the year’s end which I have never witnessed in my short investment lifetime really did come true.
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The SRS Fund Nov 2023 Update
Despite the Federal Reserve hawish stance on interest rate the month of Novemeber brings about a roller coaster ride on yield. First US 10 year bond yield touch 5% then very quickly reversed plunging quickly as data suggest a winning war against inflation.
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The SRS Fund Oct 2023 Update
If there is one particular month to deploy cash this would be the month. The SRS Fund was not spared as the traditional blood-letting month lived up to its name bringing the funds back into slide negative territory for the year.
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The Normalisation of the Yield Curve
Historically inversion of the yield curve had forewarned a recession in the making. After 2 decades of low-interest rates, runaway inflation post-Covid had finally pushed the federal reserves to increase the short-term rates at an unprecedented pace, now at over 5.5%.
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The SRS Fund Sep 2023 Update
September was a rather non-eventful month in the stock market. However, I have continued to optimise the SRS Fund in its transition from a finance and REIT-heavy fund to an all-weather fund with less volatility.
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Why is it worth topping up to SRS
Two sure things one cannot avoid in life, Death & Taxes. While avoiding both remains futile, we can try to live a longer life and pay less taxes. The SRS now allows for contributions of up to $15,300 for annual tax relief. However, 50% of SRS withdrawal is also taxed at the then prevailing tax…
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