isaac vienna 2011Isaac Chin on holiday in Vienna: "I have enjoyed a quality lifestyle."
SINGAPOREANS CELEBRATED SG50 in 2015 in a big way because we have moved from third 
world poverty half a century ago to 1st world status now, showcasing what a tiny nation can achieve with strong leadership. 

However 2015 was not a good year for the stock market and property market in Singapore. 


By 31 Dec 2015, the STI had dropped 14.5% (while HK had fallen 7.2%), against a backdrop of rising interest rate led by FED rate hike. 

We have entered 2016 under a cloud of uncertainty, and the Saudi execution of a prominent Shite cleric will not help, and could even escalate the conflict and proxy war in the Middle East, adding another dimension of geopolitical risk to the already fragile global economy.

I wish to share the following statistics of the performance of a number of blue chips in 2015, which has guided me in planning and strategizing my own portfolio for 2016:

Date 2/1/14 2/1/15 1/1/16 (y-o-y change)
STI 3174 3370 2882 (-14.5%)
AReit 2.22 2.40 2.28 (-5%)
CMT 1.90 2.04 1.93 (-5.4%)
Suntec 1.545 1.96 1.55 (-21%)
Capland 3.02 3.30 3.35 (1.5%)
DBS 17.10 20.50 16.69 (-18.6%)
SPH 4.12 4.21 3.94 (-6.4%)
SPost 1.34 1.925 1.64 (-15%)
UOB 21.22 24.61 19.61 (-20%)
MLT 1.05 1.175 0.99 (-16%)
Mapletree
GCC
0.835 0.95 0.915 (-3.7%)
City Dev 9.34 10.10 7.65 (-24%)
StarHub 4.20 4.08 3.70 (-9%)


I out-performed the STI but, in the end, the $100K I made in the first half was given back in the second half. It was a draw. My correct stock picking  and trading skills have helped saved the day.

I sold all SPost x 500 lots x 1.93(av)  and Suntec REIT x 400 lots x 1.95(av) in Jan-Mar 2015, making substantial capital gains from these 2 counters which were bought in 2012 at 0.98 and 1.10 respectively. I have traded heavily in AReit and Mapletree GCC around Sep to capture their lucrative accumulated dividend payout in Oct.

I expect harsh challenges ahead in the global economy and political arena. I am confident of my current portfolio which is best for the present circumstance: Property 50%, Equity 30%, Bonds and Cash 20%.

My equity and bonds yield 6% (av), > 350bp above SGS10Y yield.

The world situation remains precarious in 2016. The politics in the Middle East could become increasingly unstable, and the territorial competition in the Asia remains tense.

Yesterday, the first day of trading in 2016, markets fell due to the Chinese market tumbling 7% and tension in the Middle East.

I expect wide swings and depressed prices in commodities like gold and crude oil to continue. I anticipate 3 possible scenarios moving forward:

  1. The current low interest environment to persist
  2. STI to stay range bound 2,700 – 3,340 in 2016
  3. A market crash. But this will not happen if market remains lack-lustre , and short of a trigger like the Lehman Brothers collapse in 2008.

In the past 20 years, I have owned and sold about 9 properties, making more than $4M. But during this same period, I made more than $6M in bonds and shares. Overall, it was compounded return of 16Y x 10%p.a.

Aside from financial gains, I have enjoyed a quality lifestyle, with holidays in Europe and Japan, a healthy and happy family with grandchildren. In short, I have found life very enriching.

Meanwhile, I will stay low in debt, and invest only in bonds and defensive stocks.

Wishing everyone a Happy New Year.

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Comments  

#4 Mary 2018-04-05 23:49
How are you?
Last meeting a week ago, we heard you loud and clear.
How your prediction now on trade wars .Where the eagle and the dragon hammered Atlantic and Pacific ocean shores.
Do take care.
#3 Eric C 2016-10-31 00:23
Hi Isaac

Given the market situation, are you still invested with the same stocks? And with the turmoil in the O&G bonds, are you adding anymore bonds to your portfolio?

Thanks!
#2 IsaacChin 2016-05-30 11:15
Hello Basant, I have re-directed my focus from Suntec n SPost since 2015. I have focused mainly on A Reit n MGGC which have outperformed STI by a wide margin.
#1 Basant Dang 2016-05-25 16:35
Hi Isaac,

Great articles,

Quick question would you buy Suntec now?

NAV is 2.14, its dropped to 1.6 levels.

Thanks

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