Author: The Bedokian Portfolio

Considerations of ETF Selection

ETFs are great tools to start off passive index investing, whether you want to follow the Bedokian Portfolio or other investment strategies and approaches. Before you jump right in, here are some considerations that you should take note of. Consideration #1 – The Index The index determines the make-up of the underlying securities of the ETF. Take the Straits Times Index (STI) for instance, both the STI ETF and the Nikko AM STI ETF track it, but there could be some slight differences between them, such as their proportions of the STI components and how closely the ETF tracks...

Read More

The SGX ETF Universe

There are almost 60 Exchange Traded Funds (ETFs) listed on the local Singapore Exchange (SGX). You can find them on the SGX webpage, under “ETFs”. To make things easier, I have a screenshot of the webpage in Figure 1.   Fig. 1 – SGX Listed ETFs (as at 7 Sep 2018, 5:06PM) From here, you can learn a few things on ETFs. #1 – ETF Providers The listed ETFs are typically prefixed with the name/abbreviation of the ETF providers, such as the IS Asia HYG, with IS being iShares; and SPDR being ETFs from State Street Global Advisors, etc....

Read More

Introducing The Portfolio Multiverse

The Portfolio Multiverse is a concept in which an individual would plan, manage and organise his/her investment and trading portfolios based on each portfolio’s objective(s) and characteristics, and the individual’s risk appetite, risk tolerance, knowledge and allowable time for the portfolios, asset classes and/or financial instruments used in it (that is a mouthful, I must admit). This concept stemmed from my mental accounting bias and personally I felt it is easy to view one’s overall investment/trading picture. Is it difficult to start off this Portfolio Multiverse? Not really. In fact, if you are a salaried person and have started...

Read More

Does Investing In Corporate Bonds Contravene Value Investing?

I was asked this question not too long ago by a fellow investor during a coffee session, and when I first heard it, I was like “Okay…is it going to be something complicated?” After hearing out his explanation, I had gotten what he is trying to say. Basically and in gist;  a.    Corporate bonds are considered long term liability, i.e. debt, and;  b.    One of the rules of value investing is to find low debt or no debt companies.  So his question was if I follow (b), then investing in (a) would contradict my rule in (b). This is a very...

Read More

The Bedokian Portfolio Has Turned Two! And Some Smart Tips For You!

Two years ago today, I had launched The Bedokian Portfolio ebook and blog. A lot of things happened between then and now in the financial markets, to name a few: the bull run of 2017, the trade war, the introduction of local REITs ETFs, disruptive technology, etc. Despite these good and bad things happened around us, as investors we have to keep the course and stay invested, but we have to stay invested smartly against an unknown future. Here are some smart tips for you. Smart Tip #1: Stay Diversified Diversification is one of the key underlying principles of The Bedokian...

Read More

Another Bond ETF is Coming

Nikko Asset Management (Nikko AM) had just announced it would list an ETF on the Singapore Exchange (SGX) on 27 Aug 2018. The new ETF, called the Nikko AM SGD Investment Grade Corporate Bond ETF (which I will shorten it to “the Fund”), tracks the iBoxx SGD Non-Sovereigns Large Cap Investment Grade Index. About This is a bond fund, similar to Nikko AM’s other offering, the ABF Singapore Bond Index Fund, which holds Singapore government and quasi-sovereign/supranational bonds.  The Fund is Singapore dollar denominated, meaning all of the underlying assets are in SGD, although 74.8% of them are issued...

Read More

The Straits Times Index

By now a few people had pointed out something about the Straits Times Index (STI), viewed as the representative of the local equities market; there is not enough diversification and it is overweight on certain sectors. Let us take a look, shall we?   Fig. 1 – Weightage of the STI1   The three main sectors of the STI are banks, industrial goods and services, and real estate, which constituted a total of 71.61%, quite a heavy concentration there. Banks, which consisted of the big three (DBS, UOB and OCBC), stood at 41.62% of the index, almost half! Extrapolating this...

Read More

Going Local, Global or Glocal

A number of investors I know of started their investment journey from the local financial markets, like equities and bonds listed in the Singapore Exchange (SGX), Singapore Savings Bonds (SSB) and the local bank fixed deposits. Some had ventured on to overseas markets while others stayed put. Coming from another angle, I know of a handful who began with foreign financial markets, in particular the United States (U.S.) markets. Again, some had “returned” with SSB and a mix of securities from SGX, while others just remained vested overseas. There are many reasons why the above preferences happen. Some say...

Read More

It’s That Time of the Year Again

The first half of 2018 is coming to a close, and it is that time of the year again; yes, Bob will be rebalancing on 29 June 2018, the last trading day before the start of the second half, with an additional injection of $5,000. I had mentioned that Bob may consider investing in some individual company securities, but had yet identified any to invest in, so he will be going along with his original ETF strategy. The $5,000, plus any dividends collected, will be split among the asset classes. So watch out for Bob’s portfolio status here in...

Read More

Light Reads On Understanding Financial Statements

In my ebook The Bedokian Portfolio, I did not cover much on financial statements except for a brief description of the income statement, the balance sheet and the cash flow statement1. Short of reading up accounting and financial textbooks, it is not easy to explain the nooks and crannies of these statements in a simplistic form. Fortunately, I have identified a couple of books that are light for reading (and light for your brain, too) in understanding some of, if not almost, the whole gist of things. Each of these books could be read over a lazy weekend and after...

Read More

Physical Property in The Bedokian Portfolio?

I had mentioned about property briefly in my ebook1, which I stated that it should not be in The Bedokian Portfolio due to its huge capital outlay. One of my acquaintances suggested that I relook into this. Let us look at physical property as an asset class. Real and Physical Asset Unlike equities and bonds, properties are real and physical assets, meaning you can see it and touch it. The main argument for properties over the other financial instruments is that it will never go down to zero value (end-of-lease assumptions aside). Even if a house is demolished, the...

Read More

All About Price: Introduction & Valuation of Value

In our everyday lives, there is one attribute that you will see, hear, use, ponder and gawk about most of the time. Yes, that attribute is price. Whether you are comparing on the same item across different places, different items in the same place, or different items across different places, the notion of price will always be there. Zooming into the financial markets, the price of the financial instruments will be the first thing you will encounter; the bid/ask figures on your trading platform, the ticker tape shown on most business news channels, etc. There is no way you...

Read More

An Intervention and Some Lessons Learnt

While on a weekend getaway a couple of years ago, I received a message from a friend, whom I shall name “H”. H was a relatively new investor and wanted to seek my opinion on a blue chip company whose share price had fell drastically. From H’s entry price, the fall was about 40%, and H was worried about holding it. As I did not bring my laptop or tablet along, I had to use my smartphone (and the hotel’s free Wi-Fi) to do some rudimentary research on this company. After a few rounds of reading from a small...

Read More

Do Not Underestimate The Power of Dividends

One of the underlying principles of The Bedokian Portfolio is in dividends (with bond coupons and bank interests included), which is why the tag line for it is “passive income through dividend and index investing”.  Dividends serve as the compounding effect in the early part of portfolio building, and then later as passive income when one is ready to retire. On a shorter term, dividends can magnify your gains and mitigate your losses. Here’s how. You May Be Earning More Than You Think Take for instance the SPDR STI ETF, one of the ETFs that track the Straits Times Index,...

Read More

Like us on Facebook

Follow us on Twitter