Author: Investment Moats

Assessing FLT and FCOT’s Merger

Frasers Logistics and Industrial Trust (FLT) announced that they will be merging with Frasers Commercial Trust (FCOT). The benefit of this deal looks rather straightforward to me, but I thought sometimes it is good to exercise some investing brain juice. If you failed to use it, you will lose it faster. This article will be rather short (hopefully). How the Acquisition Will be Done The merger will be done by FLT acquiring FCOT through a combination of issuing new FLT shares for FCOT and paying cash to FCOT shareholders. For each FCOT shares, FLT will swap 1.233 FLT shares...

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Singapore Savings Bonds SSB January 2020 Issue Yields 1.76% for 10 Year and 1.52% for 1 Year

Here is a higher yielding, safe way to save your money that you have no idea when you will need to use it, or your emergency fund. The January 2020’s SSB bonds yield an interest rate of 1.76%/yr for the next 10 years. You can apply through ATM or Internet Banking via the three banks (UOB,OCBC, DBS) However, if you only hold the SSB bonds for 1 year, with 2 semi-annual payments, your interest rate is 1.52%/yr. $10,000 will grow to $11,772 in 10 years. This bond is backed by the Singapore Government and its available to Singaporeans. A single...

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A Private Leasehold Condo Can Give Decent Returns

After more and more people come out to say that leasehold will go down to zero value, more and more are preferring to purchase freehold than leasehold. There is also this saying that only freehold and no leasehold. So I wonder if you cannot get a decent compounded return if you held a leasehold for a long time. So in this article, I will show everyone a case study of a local private leasehold and how its return profile looks like in the past and in the future. Last week, I put my home and my friend Caveman’s home...

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My Experience with the FX Spreads on Standard Chartered LiveFX

Since they started, I have been using Standard Chartered Online Trading as one of my main trading platform for the past 8 years. Since then, a few other platforms have sprouted up, notably FSMOne and Interactive Brokers. They look to be competent platforms and would fit my needs, but we can observe high behavioral switching costs working here. My rates are 0.18% for SGX Trades and 0.20% for other exchange trades with no minimum. This is because I am on Priority Banking. If not the rates are 0.20% and 0.25% respectively and there is a 10 dollar minimum. While...

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Our 21-Year Seng Kang Flat’s Return Can Be 1.6% a year or 8% a year (depending on how you see it)

The growth rate of my parent’s HDB in Seng Kang is 2.27% a year. We had this place for 21 years. The growth rate of an HDB flat is not something we monitor on a frequent basis. There are enough financial figures that I have an eye on that I can monitor a figure less. I didn’t understood this in the past but now I understand why accountants don’t prospect stocks the way they should. You see so much financial numbers sometimes you feel like vomiting. There were 3 things that triggered this post. The first was one real...

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How Do I Know If I Have Safely Won the Financial Game?

Dr William Bernstein gave the following advice when asked: “How much exposure should people have to stocks?” “A lot of people had won the game before the [2008] crisis happened: They had pretty much saved enough for retirement, and they were continuing to take the risk by investing in Equities. Afterward, many of them sold either at or near the bottom and never bought back into it. And those people have irretrievably damaged themselves. I began to understand this point 10 or 15 years ago, but now I’m convinced: When you’ve won the game, why keep playing it? How...

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Your Compounded Growth Rate Earned Will Only be Known At the End

I went to lunch with my colleague Bryan on Friday, and we had this discussion on investment outcome. Bryan did some reflecting and realize how little assurance we can get about our investment returns: You will only know your compounded rate of return earned when you are near the end of your time horizon, looking backward. I do see signs of a good wealth builder in Bryan. To be good, you need to prioritize your time, and spending enough time reflecting on the investing knowledge you read and distill them, then make use of them. Reflecting on what he...

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A Strategy to Avoid The Pain of Losses? Don’t Be Naive

When Eagle Hospitality Trust’s (EHT) share price fell recently, I thought it is a rather good exercise to take a look at how 5 investors will experience the downside. EHT is a real estate investment trust (REIT) who master leased their assets to their sponsors. At various price points, it provides the investor with a dividend yield of 8% to 14%, based on their forecasted cash flow guidelines. When the share price fell, many investors sell. There are also investors who think there is a value somewhere and are buying. This is, after all, a business model that is...

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Thoughts on the HENRYs, Forgetting FIRE and the Appeal of Annuities

I still have some work to do over the weekends so its no stock analysis, less reading, all work. Meantime, I came across some stuff that you might find interesting. Something on FIRE, something on media coverage, a little on the HENRYs and my thoughts on annuities. My Thoughts on Annuities In my last Sunday article, I profiled how an insurance adviser manages the potentially volatile nature of his income. He has a question for me that I forgot to address and so I do owe him an answer. Basically, what do I think about annuities? It is a...

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When Europe, Singapore, and Value Smashed the United States and Growth

The last time all these value factors didn’t work so well, for such a long time is in the 1920s. That is a long time. Our brains would probably reason that there are similarities today to the time back then. When there are periods of extreme financial upheavals, the value factor does not seem to work so well. (When we say extreme it is this kind of financial meltdown, not your typical 20-30% market drawdowns) Looking back, the value factors came back. As an investor having a 30 years horizon, you would have enough time to benefit from it....

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Singapore Savings Bonds SSB December 2019 Issue Yields 1.71% for 10 Year and 1.56% for 1 Year

Here is a higher yielding, safe way to save your money that you have no idea when you will need to use it, or your emergency fund. The December 2019’s SSB bonds yield an interest rate of 1.71%/yr for the next 10 years. You can apply through ATM or Internet Banking via the three banks (UOB,OCBC, DBS) However, if you only hold the SSB bonds for 1 year, with 2 semi-annual payments, your interest rate is 1.56%/yr. $10,000 will grow to $11,713 in 10 years. This bond is backed by the Singapore Government and its available to Singaporeans. A single...

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Some Thoughts on CPF Rants, Bond Tents and New Financial Adviser Money Management

After a tiring day, I don’t really feel like putting out an article that was supposed to be meant for this Sunday. However, there are some comments to be made. How Should A Financial Adviser Manage His Own Money? My friend Jason here heeded my call to have more self-employed folks show us how they manage their variable income, or how they kick start their business in the initial years. Jason applied my Phase 1 and 2 planning. He worked out how much is his Essential expenses ($24,000 a year). He would have a 1-year runway to proof that...

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How to Generate Regular Income from No-Income Funds

On some occasions, I feel the need to write some articles over at Providend. If they benefit Investment Moat’s readers, management is OK for me to share them over here. We observe certain misconceptions that are rather pervasive when it comes to funds our clients held, what we recommend to them, and what they are considering to purchase. The really popular produces are the First State Dividend Advantage kind of distributing unit trusts. This is pretty similar to a Lion-Phillip S-REIT ETF, which is a distributing ETF. What is common among the unit trust and the ETF is that...

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The Story of One Sibei Old Ship

There is a ship in trouble and everyone seem to be talking about it. The Edge Magazine ran an article titled Eagle Hospitality Trust could get wings clipped as key asset The Queen Mary sinks into disrepair. Basically, Eagle Hospitality Trust (EHT) a REIT with full-service hotel assets in the United States owned a ship called The Queen Mary. It is an old ship. If you multiply Kyith’s age by 2 and it will still be older than Kyith. Anyway, the ship is moored in the harbor and tourists, locals can stay in the 347 rooms and have fun...

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Why Living Off Dividend Income in Retirement is Not Perfect

When I first went down this financial independence rabbit hole, the dividend model looks pretty sound. Spend only the income that is paid by your portfolio of dividend stocksYour capital is untouchedSince I am invested in a 100% stock portfolio, if I manage the portfolio well, stocks should give a high probability of keeping up with inflationMarkets can go down. However, since you do not touch your capital, if your capital goes down, and you will only spend the income distributed, your capital will have the opportunity to recover back.Since you are not selling or drawing down your capital,...

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