CACHE is another industrial REIT whose shares I owned other than Soilbuild Business REIT. I still own Soilbuild Business REIT sharesthrough CPFIS. Recently, the company announced rights issue to raise approximately S$102.7 million. Approximately S$99.9 million (equivalent to approximately 97.3% of the gross
proceeds) will be used to partially repay Cache’s existing borrowings to reduce
aggregate leverage and create additional debt headroom for future growth.
The rights issue will reduce the gearing of CACHE from 43.4% down to 35.5%. However, the DPU would also reduce with the increase in number of shares. NAV would also drop slightly.
My average purchase price for CACHE is $1.12 and I currently own 16000 shares. I am still in the negative for this REIT. I am entitled to 2880 shares. I accepted and applied for 7120 excess shares. Hopefully, it would not be a mistake to average down. The results for the rights issue would be out on 9th Oct.
Is CACHE Worth Investing Now?
CACHE's share price as at 22 Sep 2017 closing price was $0.835. It is trading above it's NAV. For this company, I don't it's worth the premium currently even though the dividend yield may seem attractive. I did cover CACHE in an earlier blog post. I don't see any positive news coming from CACHE.
Screenshot from Chartnexus
However, at an offer price of $0.632, I will buy first. Buy more too. Assume a DPU of 6.882 cents, based on my purchase price of $0.632, my dividend yield for the new shares would be 10.89%. Of course, the dividend yield for my existing shares would also suffer as a result.
Screenshot from Stocks.cafe
The Management was capable of growing the DPU in the past. Hopefully, they could turn this REIT around soon. Until we could hear some positive news coming from CACHE, I would not touch this REIT if I am not currently invested.
Stock Portfolio (Cash)
There's a drop in my Sep 2017 dividend income compared to previous years. This year's drop is due to change in XD date of Croesus Retail Trust which was brought forward to Aug. CRT will no longer be contributing to my dividend income from now on as majority of shareholders voted in favour of Blackstone's buyout offer.
Screenshot from Stocks.Cafe
These are the companies that will be distributing dividends to me.
Bond Portfolio (Cash Inv, Unit Trust)
My Unit Trust bond portfolio sees an increase in dividend compared to previous month. In Sep 2017, I received $885.41+80.76= $966.17 in the form of units.
Screenshot from dollarDex
Total dividend income for Sep 2017 = $144.66 + $966.17 = $1110.83
That concludes my dividend report for the month of Sep 2017!
There are a lot of haters for this video. I suspect they are working for the media. Haha.
Bottomline, when people are fearful and start dumping good quality stocks, it's time for us to be greedy. However, we will need to have the mental capacity to withstand paper losses in the short term. We do not have a crystal ball to tell us when the market has hit a bottom. Most likely after buying, the price may continue to move southwards. Alternative, wait till there's clearer sign such as higher lows on technical charts before buying.
Do you exhibit qualities of becoming rich and successful someday? Watch these 3 part mini series videos to find out!
Part 1
Part 2
Part 3
I want to highlight the point of don't be a victim of your circumstances. It's important not to play the victim card and start blaming others for your failure. For those that often lose money in trading or investing, don't blame the market or the people whom you get stock tips from. Instead, find out the reasons why you are losing money instead of profiting consistently. What I like about the financial market is every retail trader is treated equally. The market doesn't judge you based on your education level. You don't even need to have a degree or finance related background to trade or invest. I don't have both by the way. It all depends on individual skills and the amount of time and effort you are willing to spend in order to master the instrument.
The 2 videos below tell us how the Rich and Poor do things differently. I personally feel that Rich and Poor is just a state of mind. Everyone has their own expectation of how much networth to be able to consider oneself being Rich. Therefore, my financial goal is just to to able to achieve financial freedom through multiple streams of income. With that said, there are stuff in the videos that I also believe that differentiate the Rich and the Poor even before I came across the videos.
Highlights of the 7 Things That The Poor Do
#1 Consuming Vs Creating
This is a classic example. We can just take a look at the obscene income hollywood stars and movie studios are making for each blockbuster. Handphone manufacturers like Apple and Samsung are also making huge profits every year by releasing new handset models.
#2 The Poor Lose Time Consuming Media
Instead of spending time improving ourselves in terms of financial literacy, a lot of us like to spend our spare time watching videos and playing video/mobile games. This syndrome is very common in Singapore and we can see most people doing that while commuting. We seldom see commuters reading a book or newspaper nowadays. This is actually making the content producers rich!
#3 The Poor Spend A Lot of Time To Save A Few Dollars
The Poor spends time to make money while the Rich spends money to buy time. The Rich will focus their time doing stuff that make them rich. They would pay others to help them with stuff that doesn't add value or produce less wealth for them.
#6 Most People Have One Source Of Income
This is very true. Most people only have a fulltime job and doesn't have other sources of income that could help them to achieve financial freedom. They may set aside an amount of money for savings each month but the miserable interest earned would not be able to fight inflation in the long run.
#7 Most Aim to Retire At 65
Sad to say, as life expectancy increases, retirement age has to increase too. People are finding it hard to retire early. In the past, retirement age was 55 years old. So what could people do after 55 as a lot of jobs would be replaced by robots and automation eventually? Collecting cardboards? Become entrepreneurs by selling tissue packets at hawker centres?
On to the Next Video: 8 Habits Rich People Have (That Most Of Us Don't)
#1 The Rich and Successful Build Morning Routines.
The Rich looks forward to each day while most of us drag ourselves to work basically. However, I am not quite sure how doing yoga in the morning would help in achieving success. Perhaps it refers to doing stuff that would energized and prepare you for the day ahead.
#2 They take Immediate Action
The Rich takes action and do not give excuses why not to do it. The Poor tend to procrastinate and give excuses.
#4 They kill time wasters
No netflix and chill? No cat videos? Done.
#5 They visualize their success
Visualize and experience in your mind the goals and results that you want to achieve.
#6 They step out of their Comfort Zone
Successful and Rich people do stuff that the average person is afraid to do.
#8 They cut their Loss
Rich people are not afraid to lose money and they cut their losses. They let their winners run and cut losses short. The Poor are afraid to lose money and hang onto their losses, hoping things would turn around eventually.
Do you have the Rich or Poor's mentality? Hope you find the videos educational!
It has been a while since I last updated on my Forex Trading Experiment. I have stopped trading on lower 15 min/1 hr chart. My stop loss got triggered quite often due to the tight stop loss. The trading experiment will just focuses on 1hr/Daily chart moving forward. The screenshot below shows all the trades taken so far.
$1000 Profit On a $5000 Account in Less Than 2 Months!
The gain on my account is roughly 1000/5000 x 100 = 20% However, if I just calculated based on the total amount risked for the 15 trades, the gain would be 1000/(150 x 15) = 44.4%!!! If you have been following my Forex Posts, you would know I am risking $150 per trade for the potential to make $300. In total, I was risking $150 x 15 = $2250. But in reality, it would be impossible for me to lose this amount. I was following the trend on a daily chart. Unless the trends always reverse after I took it, which is not impossible but unlikely. Imagine flipping a coin 15 times and getting the same side everytime. Possible?
The amazing thing with this result is actually I was only right 50% of the time! This reinforces the risk/money management rule I was making on my first Forex Trading Post. My Risk Reward for each trade is 1:2. Without having proper money management rules in place, a trader could win 90% of the trades but still end up losing money. This also applies to other trading instruments like stocks and futures. As can be seen from the result, I may not have the best trading method which is only right 50% of the time but still end up profitable!
I was comparing the performance of different financial markets over a 10 year period. The chart below shows the performance of FTSE 100 (UK), Hang Seng (Hong Kong), S&P500 (US), Thai SET, NIKKEI 225 (Japan), China and our beloved STI Index. Can you guess which is the best and worst performing market? The best performing market may shock you!
Screenshots from FSM
It's Thailand!
I took a look at some Unit Trusts that invest in Thailand and the performance are as shown below.
Our gains would be more than 100% if we had invested in Aberdeen Thailand or Fidelity Thailand A USD 10 years ago. This is not a recommendation to buy or sell Thailand funds as past performance may not reflect future performance. I did invest in Aberdeen Thailand before and I lost money as I bought and sold at wrong time.
Of course, it's possible to make much more money from stock market provided we are correct in our stock picks. However, I would not consider stock investing as truly passive income due to the research efforts required.
Robo Advisory
There is now a new way of investing and generating passive income through robo advisory. Robo advisory cancreate a diversified portfolio consisting of bonds and etfs based on our financial goals and risk appetite. Their commission rate is also lower compared to the traditional method of investing in Unit Trusts.
There are 2 companies that offer such service: https://www.stashaway.sg and https://www.crossbridgeconnect.com/ They have local office in Singapore and are regulated by MAS. For those interested in such hands off investing approach can check out their websites. If you are invested in STI ETF and unsatisfied with the performance, can also check out these services. If you have used their services, please feel free to share your experience in the comments below. I have not used their service myself and can't provide any feedback. Happy Investing!
Part 1 My Thoughts
At first glance, the current deal doesn't seems attractive. However, threat from North Korea is something which CRT shareholders should not ignore also.
Guess which direction would North Korea fire it's test missiles?
In case you missed it, North Korea actually flew it's missile over Hokkaido recently.
Under normal circumstances, in the absence of threat from North Korea, I would not think much about the proposed offer. However, I feel there's higher probability now that CRT's share price would continue to head southwards than upwards if tensions continue to build up between North Korea and US. Japan is near to North Korea and if war breaks out between US and North Korea, things won't look good for Japan too. Trump could be busy with Hurricane issues in US currently and not giving as much attention to North Korea for now.
Given current situation, would Japan's tourism still do well in the coming months or years? The retail sector in Japan is likely to be affected. Can CRT's DPU still continue to increase for the coming years assume the buyout deal failed to take place. Hopefully, shareholders who are voting would make a wise decision on Wednesday and not end up as a casualty of potential war. My verdict is: Take the money and run first before shit hits the fan.
On 28 June 2017, Croesus Retail Trust announced a proposed acquisition by Cyrus Bidco Pte. Ltd. of all the issued units. If you are a shareholder of Croesus Retail Trust, you would have received these documents in your mailbox by now.
Wow. Where got time to read?
For those who haven't heard about the news by now, the privatisation of Croesus Retail Trust would be offered at $1.17 per Unit. However, the offer would only go through if 2 conditions are:
Approval of >50% in number of Unitholders present and voting in person or by proxy at the Scheme Meeting
Approval of >=75% in value of the Units held by Unitholders present and voting in person or by proxy at the Scheme Meeting
The said Meeting would be on 13th Sep 10 am. Unfortunately, I am unable to attend and I do not have a proxy.
I am currently holding 13700 shares at an average price of $0.868.
Screenshots from StocksCafe
My Calculations
Croesus Retail Trust's closing price was $1.055 on 27th June before the buyout announcement. It would seem like shareholders are only getting $1.17-1.055=$0.115 for this deal.
Screenshot from Chartnexus
Now, let's take a look at CRT's recent year dividend record. If we add 2016 and 2017 DPU together, total is $0.0766 + 0.0706 = $0.1472. Alamak! We are offered less than last 2 years of dividends for this buyout offer! Why like that???
Looks like I would reject this offer right? But....
Here's the company shares that I sold early this week! I still own Singpost shares under my CPFIS account though.
Even though I have sold these company shares, it doesn't mean they are not worth holding anymore. The screenshot below shows how much I earned from dividends and capital gain.
Screenshot from Stocks.cafe
Due to market uncertainty, there's bound to be opportunities to get back into the market provided you have the cash. I am still holding a lot of stocks at the moment. I am still earning dividends from my existing shares. If the market goes down and goes on a sales, I have the cash to go in and buy. Dividend yield will also go up if share price goes down. Of course, the company has to be continue making good profits during the market downturn.
PS - If you wish to receive updates on my blog, just add your email address at the right to follow by email (Desktop view).
Upcoming Blog Post: My Thoughts On Proposed Acquisition of Croesus Retail Trust
I hope I would be wrong. This could be a longer winter. Hopefully everyone has a stockpile ready for deployment if the stock market goes into downtrend.
3/9/2017 0740PM - Trump just responded via Twitter.
