Wednesday, January 20, 2016

Ronald Read: US Secret Millionaire With US$8 Million Fortune


This is not a new article but was published last year in CNBC. Now maybe a good time to bring out a motivational story to remind our long term investors that market volatility is quite expected in stock investment. Instead, we should take this opportunity to collect our 'dream' dividend stocks. Things should turn for the better in time. If you are feeling down or depressed, fear not, the rain will stop, dark cloud will clear and we shall see rainbow and sunshine shinning on us again :)

How about if I tell you that you just need to work as a gas station attendant and a janitor and you will end up as a millionaire when you retired?

That's how Ronald Read did it
1. Invest in a small basket of 6 dividend blue chips. Ronald invested in a list of major U.S. companies. They include AT&T (NYSE:T), Bank of America (BAC), CVS (CVS), Deere (DE), GE (GE), and General Motors (GM).

2. Live till ripe old age to allow your investment to compound and multiply. He lived up to 92 years old.

3. Stay invested and contribute roughly $300 a month for 65 years, assuming an eight percent rate of return. Its not a big sum of money right?

4. Frugal. Lead a very simple life, he often was seen wearing an old cap, a jacket with safety pin as the zip was not working. No car and just a small house.

Out of the US$8 million fortune, US$6 million was donated to a local library and hospital in his home town

Friday, January 8, 2016

2015 Year End Portfolio Review

Its the end of 2015, let's see how close am I to my target :) I started building my portfolio in Oct 2014. This is a full year of 2015 results.

STI vs my portfolio:
My portfolio got hit by China stock market crash, oil crisis and Fed rate hike effect around Jul 2015 and STI has been a downtrend for the rest of the year. It was a tough year where we see the beginning of the bear market. At the end of 2015, there was still no recovery in sight although there was a relief rally during Oct 2015 but things havent changed much as we were still in the bear market.

Portfolio by stocks:
I am currently still in the process of diversifying my portfolio such that they should not exceed more than 5% of my total portfolio. I am still looking out for more high dividend stocks to buy so that I will be more diversified. I have 21 stocks with me now and will be targeting to reach more than 30 of them.

Portfolio by sector:
In the sector diversification, I am quite max up with the Capital Markets sector. I also bought in quite a number of shares in the Industrial conglomerates which consists of Keppel Corp and Sembcorp Ind, it is now about 17%. Still got room to load up a bit more during this sector weakness :) Probably not more than 20% for each sector of the other stocks.

Checkout my portfolio → portfolio

Target:
TargetTargetted Portfolio sizeTargetted Monthly dividendsPeriodYearly CONDividends Reinvested
1st target$85,000$495 2015$30,000$5,900
My 1st target is to invest up to $85,000 and receive monthly dividend up to $495 per month. I think I already met my 1st target!
I have invested $123k and expected to receive monthly dividend of about $570 :)

Checkout my target → target

Dividend:
Total dividend is $6,800+
Dividend per month is $570

Checkout my dividend → Dividends

Portfolio Analysis:
My worst performer is Noble(-40%) Grrr. Not sure if I am unlucky or what. Bought it when I thought it was low enough and there were many institutions buying it at that time :(

My best performer so far is Ascendas Reit (6%). This was bought quite recently when it was heavily sold down, but glad that there was a recovery after that.

Overall, my portfolio ends negative in 2015. No thanks to all the many reasons for causing the stock market to go downhill.

At end of 2015, I already invested close to $123,000 and receive monthly dividend of $570. This is very close to my projection of my expected annual dividend of this current portfolio, I should be getting around $7000 which is about $580 per month. So I should have met my 1st year target! Yea! I will continue to follow my strategy of allocating $5000 each month to buy high dividend stocks and march towards my 2nd target which is ...

TargetTargetted Portfolio sizeTargetted Monthly dividendsPeriodYearly CONDividends Reinvested
1st target$85,000$495 2015$30,000$5,900
2nd target$120,000$700 2016$30,000$8,400
3rd target$161,000$920 2017$30,000$11,000
4th target$213,000$1200 2018$30,000$14,900
5th target$257,000$1500 2019$30,000$18,000
6th target$320,000$1800 2020$30,000$22,400
7th target$372,000$2100 2021$30,000$26,000
8th target$428,000$2490 2022$30,000$29,900
9th target$487,000$2800 2023$30,000$34,100
Final target$551,000$3200 2024$30,000$38,500
My 2nd target is to invest upto $120,000 and collect a monthly dividend of $700. Hmm, I have already invested $123,000 in 2015, so I have already met my 2nd target. Which means that I am will ahead of my plan! Hooray! The reason why collected lesser dividend is because some of the stocks bought in 2015 I didnt received the full dividend. 2016 I should see higher dividend around $700. This doesnt mean I will stop investing, I will still try to space out my investment and continue to be well ahead of my targetted plan. Hopefully I can reach my financial independence earlier :)

Checkout my strategy → Strategy

Dividend Stock Tracker
I keep track of good SGX dividend stocks such as 10 years consistent SGX dividend stocks, REITs, Business Trusts, etc with real time information update. Checkout the link below:
Checkout my Dividend Tracker

Sunday, January 3, 2016

Dec 2015 Portfolio


DEC 2015 was rather quiet with the long weekends and festive seasons. There wasn't much activity on the market. But market tend to recover abit after much selldown in the early part of the month. Looking at the charts, it seems like some blue chips like SIA Eng is making a slight recovery and all pointing to a good start in 2016. Let see what we have on Monday :)

This month I added Sembcorp Marine into my portfolio.
I finally added Sembcorp Marine into my portfolio after watching it going down down down for a while. I guess it should be right to get some now. This blue chip will be here for the long term and understand it will be reporting a loss quarter soon but it should be able to weathered out this oil and gas crisis with ease. Right now it is trading at low PE of 8.9. Pretty low already.

STI vs my portfolio

My portfolio is still hovering in the negative region :( but good news is that I beat STI at least a consolation prize :)

PeriodSTIMy Portfolio (Realised)Verdict
Jan 20152.71%3.21% I win
Feb 20152.41%2.16% I lose
Mar 20153.31%0.62% I lose
Apr 20156.02%4.18% I lose
May 20153.31%3.84% I win
Jun 20150.90%1.14% I win
Jul 2015-2.41%-3.83% I lose
Aug 2015-10.54%-9.07% I win
Sep 2015-14.16%-9.34% I win
Oct 2015-8.43%-4.48% I win
Nov 2015-12.05%-8.57% I win
Dec 2015-11.14%-8.26% I win

Total 21 stocks in portfolio



Dividend
This month I received dividends from Lee Metal, UMS, Asian Pay TV Tr, SPH.



Checkout my Dividend history

Dividend Stock Tracker
I keep track of good SGX dividend stocks such as 10 years consistent SGX dividend stocks, REITs, Business Trusts, etc with real time information update. Checkout the link below:
Checkout my Dividend Tracker