Thursday, December 31, 2015

Portfolio Review 2015: Portfolio - 22.7% vs STI - 14.1%

After peaking in April, the Straits Times Index fell sharply in two distinct phases (Apr-Jul, Aug-Oct), ending the year at slightly below the 2,900 level, or 14.2% lower than where it started the year. There were many reasons offered for the weak markets ranging from weak oil price, terrorist threats, the end of quantitative easing and the hike in interest rates.
The portfolio lost a staggering 22.7%, making it the third year in a row that I have underperformed the STI. Excluding dividends, it would have lost 24.7%. The biggest percentage loser was KrisEnergy. The stock lost two-thirds of my purchase value because of the oil rout as well as my not subscribing to their rights. The biggest dollar loser was PetraFoods, shedding close to 12K. This favourite of mine is said to be affected by the weakness in sales to its key Indonesia market.

Colex was the only stock to register positive gains given the flight to safety. The garbage collector gained 15.4% the whole year or 3.2K in value. Smallest loser was Hong Leong Finance, losing 11.1% or 2K in value.
There were only 7 transactions for the whole of 2015, mostly at the start of the year. Auric Pacific, Etika and UOB-KayHian were offloaded. Hong Leong Finance and KrisEnergy were new stocks to the portfolio. In December, I added some more PetraFood to my portfolio.

The portfolio cost now stands at 101.5K and I am in the rd by slightly more than 5%. I collected dividends of 2.4k and this implies a yield-to-cost of 2.5% which I think is not bad. I do not think the companies will be increasing their dividend pay-out for CY2016 and so the yield to cost should remain stable.

While stocks will move in line with the broad market, in terms of individual stocks, I think Colex, F&N and Hong Leong Finance will do well in the coming year. GMG Global and KrisEnergy can be put in the category were I “no eyes to see”.

I intend to pump 10K more into the portfolio and the target will most likely be SingPost. My estimated acquisition date will be between February and October. The stock is still trading at a relatively high PE due to the Ali Baba hype. However, the broader market correction should push it down further. I think there will be one more decline (a distinct phase) to the market before the market slow switches to recovery mode. 

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