Dividend Warrior's Q4 2021 REITs Performance & Passive Income Update - Close to $30k Annual Dividends!

 

(Total Cumulative Dividends = S$206, 778)

My annual passive income target of S$28k is achieved! I actually surpassed it, collecting S$29,711 in total. That is similar to the rental income of a 4-room flat in Bishan or Toa Payoh. Thanks to the 3 local banks restoring their dividend payouts and most REITs improving their DPUs in 2021.

The post-pandemic recovery for commercial and retail REITs continued in the last quarter. FCT even achieved a slightly higher DPU compared to pre-pandemic days. Considering Singapore was in semi-lockdown mode back in August and September, the latest set of results is encouraging. It is a sign that tenants are finally adjusting their operations to the new endemic norm. The more resilient tenants have learnt to live with covid.

Industrial, logistics and data centre REITs just kept powering on. Both MINT and MLT delivered double-figure DPU growth year-on-year! Moving forward, I believe these 'new economy' assets should provide a boost to my passive income in 2022, while keeping pace with inflation. The invisible inflation monster is rearing its ugly head. We need to ride this beast. REITs own physical properties that should benefit from inflationary pressures. Take ParkwayLife REIT for example. After signing the new master lease with IHH, its NAV jumped.

Embrace Change. It Makes Life Easier.

Dividend Warrior

Dividend Warrior's Q3 2021 Portfolio Update - Tech Shopping Spree!

(Total cumulative dividends of S$199, 900)

Top 12 Holdings (30 Sep 2021)

Portfolio Cost: S$530, 295
Portfolio Market Value: S$748, 868 
Portfolio Overall Unrealized Profit: +S$218, 573 (+41.2%)
Portfolio XIRR (FY2021): +12.01%
Dividends Collected (9M 2021): S$22, 833
Current Warchest: S$23, 700

(*All figures are accurate as of 30 Sep 2021)

Portfolio Actions in Q3 2021:

• Accumulated more Alibaba shares at HK$150 - HK$160 range
• Accumulated more Tesla shares at US$725 
• Initiated new position on Sea Ltd at US$326 

DCA On Alibaba & Tesla Never Stops

When the going gets tough, go shopping. To me, shopping for stocks is a special type of happiness. Especially when you know you are buying at lower levels than guys like Charlie Munger, Ray Dalio and Monish Pabrai. These are titans with diamond hands.

'Common prosperity' policies and potential property sector collapse from China. Inflation and rate hike fears from the US. Another debt ceiling crisis looming in the US (aren't they tired of doing this every year?!) Ha! It is gonna take a helluva crisis to end capitalism. Even a pandemic only slowed it down for a year. There is always a crisis lurking around the corner.

Sticking to my plan of buying some US tech, some Chinese tech and some REITs every quarter. Focus my buying efforts on whichever sector that is experiencing a dip. The return of inflation and rate hike fears are starting to exert downward pressure on growth and income equities. As someone who loves buying the dip, that is music to my ears! I could afford to do this because I have the advantage of staying employed with a stable income, supplemented by a steady stream of dividends. So guys, hang on to your jobs. It makes investing a whole lot easier.

Next, position sizing is important. We are all too familiar with those financial Youtubers declaring that they went 100% all-in on a single stock. Well, most of them are young adults in working age. Their future income allows them to continue DCA or buy into other stocks. A regular retiree who is fully dependent on his retirement nest egg or rental income to survive would not have the firepower to keep averaging down on a falling stock such as Alibaba. Catching a falling knife is extra painful when one does not have deep pockets. After his cash is depleted, the investor can only stare at the sinking price helplessly. Worse still, Alibaba is not a stock that pays dividends as you wait for it to recover. Staring at 'dead' money for months is no fun for sure. Not every retiree or investor is like Charlie Munger, a big whale who is flushed with cash. Munger can DCA all he wants for as long as he wants. We must be careful not to copy blindly. I am limiting my Alibaba exposure to 5% of my overall portfolio.

As long-term investors, we should do things that are sustainable and scalable. That's how I built a S$500k position size in REITs. I just kept buying the dips. It's not rocket science. Consistency is more important than perfection. Focus and simplicity. Find an investment style that suits you so that you are less likely to give up and flip flop halfway through the journey. A rolling stone gathers no moss. 

Enjoying The Endemic Phase In Singapore

Having a meal in the restaurant is just different to ordering take-outs. With more than 80% vaccination rate, I support Singapore in going the endemic route. I believe this is the sustainable solution.  The cycle of lock-downs and re-opening is too disruptive. We need to adapt and learn to live with the virus.

Tech Growth Portfolio Quick Update - Average Prices Full Reveal!

Overall Profit/Loss: -2.1%

Total Dividends Collected: US$28.33

*Accumulated more Baba (9988) and Tesla in August 2021

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Dividend Warrior's 3Q2021 REITs Performance & Passive Income Update - Living In An Endemic World

 

Total cumulative dividends received: S$199, 613

9-month passive income grew 24.9% year-on-year, from S$18, 050 in 2020. My portfolio is on track to generate $28k in annual dividends by the end of 2021.

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Another Record-High Quarterly Earnings From Apple, AMD, Microsoft & Tesla!

 

Dividend Warrior's 2Q 2021 Net Worth Update - S$900k Milestone Achieved!

 Year-on-year changes:

• Non-REIT stocks allocation rises from 16% to 23% (Propnex rally, Banks recovery & accumulation of tech stocks)
• REITs allocation dips slightly from 58% to 57%
• Warchest allocation falls from 6% to 3% (went on a tech stocks buying spree)
• Emergency Fund allocation dips from 3% to 2%
• CPF OA allocation dips from 17% to 15%

Check out my last year's networth update Here! :)

Enjoying the Phase 2 (Heightened Alert) Re-opening in Singapore so far!

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Don't Get Sidetracked By People Who Are Not On Track

Dividend Warrior

Dividend Warrior's 1H 2021 Portfolio Update - Buy In May & Stay Stay Stay!

 

(Total cumulative dividends of S$191, 948)

Top 12 Holdings (30 Jun 2021)

Portfolio Cost: S$520, 015
Portfolio Market Value: S$745, 963 
Portfolio Overall Unrealized Profit: +S$225, 948 (+43.5%)
Portfolio XIRR (FY2021): +18.92%
Dividends Collected (1H 2021): S$14, 881
Current Warchest: S$26, 300

(*All figures are accurate as of 30 Jun 2021)

Portfolio Actions in 2Q 2021:

• Partial divestment of PropNex. Took profit at $1.53
• Accumulated more Alibaba on the Hang Seng exchange
• Initiated positions in AMD and TSMC
• Initiated position in CapitaLand China Trust
• Applied for the Mapletree Industrial Trust preferential offering with excess

Unwavering Focus On Quality Big Tech

It was a hectic quarter for sure! There was a short period of inflation scare back in May when some investors panic sold their tech counters. Covid infection rates have been falling in the US and Europe. More countries are ramping up their nation-wide vaccination campaigns. The jobs recovery in the US has been gaining steam. US president Biden has proposed a massive $2 trillion infrastructure bill. As a result, investors fear the US Fed is considering to hike interest rates earlier in 2023, maybe even in the second half of 2022, in order to prevent hyperinflation. The tech and REIT sectors saw a short-lived sell off. Of course, I took advantage of this to BTFD. Buy in May and stay stay stay! ^^

Since the 1980s, the interest rates have never returned to its previous high after every recession. The rates just kept going lower. Sure, the US Fed might be planning to hike rates in 2023. If 2020 has taught me anything, is that the future has plenty of curveballs in store for us. Before the interest rates can return to the 2019 high of 2.5%, another crisis of some sort will emerge again. Then the US Fed will have no choice but to cut the rates back down to zero. Maybe the flames of the US-China trade war is rekindled? Maybe the covid virus mutates into something deadlier? Nobody knows.

Needless to say, I 'fast hand fast leg' grabbed the opportunity to load up on quality tech stocks. Have a plan and execute it. Alibaba at HK$210 is just too good a deal to pass up on! I have also entered fresh positions in AMD and TSMC. The Industrial Revolution 4.0 is already happening and the pandemic has accelerated the pace of tech adoption. I believe the chip/processor is a critical piece of this revolution. Almost everything important in our lives run on chips these days. Smartphone, laptop, PC, smart TV, refrigerator, coffee machine, smart watch, car, plane, data centre servers etc. 

Next, we need the software to operate these chips. So, when it comes to my overall strategy of investing in tech, I focus on hardware, software and infrastructure. Companies like Apple, Microsoft, AMD, TSMC, Tesla are Alibaba are some of the best and largest in Cloud computing, operating systems, productivity software, chip design & production, artificial intelligence, e-commerce, fintech and gaming. Microsoft Windows or Apple Mac OS? We cannot escape! Take your pick. All the laptops, PCs and tablets sold by brands such as Dell, HP, Lenovo, Asus, Acer and Razer come pre-installed with Windows. The MacBook, iMac and iPad come pre-installed with the Mac OS.

Pivoting To 'New Economy' Assets

After hardware and software, another area to focus on would the infrastructure which enable tech to grow. We have the telcos, cable network companies and data centres. Data is known as the new 'oil'. I am glad Ascendas REIT and Mapletree Industrial Trust (MINT) continue to pivot towards data centres. Whenever they raise funds to acquire more new economy assets such as data centres and logistics warehouses, I would happily oblige. It is the same reason why I entered CLCT as its REIT manager has stated that they are looking to acquire more business parks, logistics facilities and data centre in China. 

Some Singapore investors claimed that we must diversify into foreign stocks to get more growth from overseas markets. But actually one can collect rental income from US, Europe, Australia and China by simply investing in AREIT, MINT and CLCT.

Tech Is The Great Engine Of Change

Dividend Tech Warrior

Dividend Warrior's 2Q2021 REITs Performance & Passive Income Update - A Record High!

 

Record-high quarterly passive income achieved! ^^

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Networth Update 1Q 2021 - $900k In Sight!

 

Preparing For An Inflationary Future

Bottom level is the foundation, the safety net, the absolute rock of my overall portfolio.  Upon this rock, I shall build my castle. The banks and S-REITs would form the middle layer that provides passive income through dividends and cash distributions. The financial and property sectors usually correlate well with inflation. If we are expecting inflation to pick up in the coming years, we won't go too wrong to overweight in these 2 sectors. The HDB resale market in Singapore has been doing well since 3Q2020. Waiting for my BTO flat to be completed in 2Q 2023. Excited! I intend to fully pay for my flat with CPF OA savings.

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Dividend Warrior's 1Q 2021 Portfolio Update - S$700k Milestone Achieved!

(Total cumulative dividends of S$180, 518)

Top 12 Holdings (31 Mar 2021)

Portfolio Cost: S$510, 412
Portfolio Market Value: S$710, 451 
Portfolio Overall Unrealized Profit: +S$200, 039 (+39.2%)
Portfolio XIRR (FY2021): +14.93%
Dividends Collected (1Q 2021): S$3, 451
Current Warchest: S$26, 300

(*All figures are accurate as of 31 Mar 2021)

Portfolio Actions in 1Q2021:

• Initiated positions in Alibaba and Hang Sang Tech ETF

• Accumulated more Apple shares

2021 Strategy - Discount Shopping For Quality Tech

The yield of 10-year US treasury bills kept rising in the first quarter. When long-term rates trend up, investors start to discount future earnings potential of companies more heavily. Those high-flying tech companies with stretched valuations had come under selling pressure after outperforming the market in 2020. Another market force in play was the sector-rotation out of tech and into 'post-pandemic reopening' sectors such as hotels, airlines, cruise, transport, oil and F&B. Global covid-19 cases and deaths have been declining as countries raced to vaccinate their people. The tech sector correction gave me a rare opportunity to scoop up some Apple shares.

Over in China, big tech companies like Alibaba and Tencent have been hit with anti-monopoly investigations by the Chinese regulators. This sent the Chinese tech market into a tailspin. The share price of Alibaba has fallen more than 25% ever since the Ant Group IPO was scrapped. Investors were wary of more stringent regulatory measures from the Chinese government. Again, I took advantage of the correction to initiate positions in Alibaba and the Hang Sang Tech ETF.

The Biden administration wasted little time in 'jump-starting' the US economy by passing a $1.9t covid-19 relief package and proposing a $4t infrastructure spending plan. The US unemployment rate also dropped significantly by March. All these factors have increased the prospects of the US Federal Reserve hiking rates earlier than expected. By now, all of us should know that a rate hike cycle would probably cause weakness in the REITs sector. We had that experience in 2018-2019. But the veterans would know better than to panic. We have diamond hands and HODL for the Power of CD! 

My overall strategy for 2021 would be to compound the dividends I received from banks and REITs into tech stocks. It is widely expected that the dividend payout restrictions on DBS, OCBC and UOB would be lifted in 2H2021. In DBS' recent AGM, the management has expressed confidence in restoring dividend payout quite 'rapidly' once MAS gives the go-ahead. Certain REITs that retained distributions last year in order to provide rental relief to tenants should also start to return cash to unitholders in 2021. Footfall and tenant sales revenue at malls have been recovering steadily since Phase 3 re-opening in Singapore. And starting from 5 April, work-from-home would no longer be the default mode. Suntec City used to resemble a ghost town a couple of months back. Now, the office lunch crowd is well and truly back on weekdays! 

No Need To Choose Sides

Society has become more divisive. Politics has become more divisive. US-China tensions look set to continue for a long time. Everything seems to be binary. You are either with me or against me. Making forced choices. Well, there is no need to 'take sides' when it comes to investing. As an investor, my sole objective is to invest in companies that make money and grow. Plain and simple. I don't care if it is an American, Chinese, European or Japanese company. Some investors went too deep into the internet rabbit hole. Getting confused and distracted by the media noise. My fellow dividend investing friend, DK, summed it up pretty well in his latest post. The last time I checked, almost all consumer tech devices still run on Android, iOS and Windows. Never count the Americans out. Doesn't matter if the cat is black or white, as long as it catches rats, it is a good cat.

Keep An Open Mind So That New Wisdom Can Get In

Dividend Warrior

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