1 Year Anniversary - Thank You to Our Readers!

It has been 1 year since we started this blog when there were only 2 readers (CZM read my post while I read hers) to thousands of readers now. Interestingly, the first post of the blog was actually written by CZM - Food in London on 29/12/2016.

Let me share some interesting statistics/numbers which were contributed by each and every readers :)

We have > 215,000 pageviews since inception! The number continues to grow as you read this article. The latest number can be seen on the top left hand side <---

Majority of the readers are from Singapore.

Majority of the readers are between 25-34. Personally, I thought this graph is really interesting. Between 18-24, people have yet to start working hence, there is no need/reason to read up on finance/investment related stuff. 25-34 is when people enter the real world - start working, have some money but do not know what to do with them. 35-44 is when people have worked for at least 10 years, managing finances/investment is lesser of a problem. Precious time are mostly spent with family/children, reading bedtime stories instead of blog posts. The people in the 45-54 group would be thinking this 27 years old couple have not even live through a financial crisis. Better stop blogging. The 55-64 group can tell us that he/she is twice our age. Half will disagree on my CPF related articles while the other half will say good job. I am pretty amazed that 65 and beyond still drop by our blog.

Alternatively, our blog is attracting readers from the age group of 25-34 because we are in this group ourselves. Few years down the road, when we start writing about bao bao (baby) and the above graph might change...

More than 75% of the readers are male. So disappointing, I thought I would have more female fans. There are many other numbers and graphs in google analytics but they do not make much sense to me.

Based on the last 7 days of data, the easiest way to find our blog on Google is by searching for "kpo and czm" or "kpo czm" where the blog is indexed at the number 1 position! A search on "kpo" will bring you to the bar instead. Interestingly, our blog is ranked pretty high up for a search on "stashaway blog", "stashaway performance" or "stashaway returns".

Last but not least, these are the top 5 most popular posts which are accessible in the top right hand side --->

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2017 Expenses Review

I have been tracking my expenses since I started working 2.5 years ago. However, I do not do any budgeting as I believe that both of us have inbuild "kiam" (thrifty/stingy) mechanism to prevent overspending and did not want to compromise too much on the quality of life. Hence, the yearly review is important (otherwise, it will be pointless to track them).

Looking back at my 2016 Expenses Review, at first glance I definitely did worst but I felt relieved when I dig deeper into the numbers.

	2017	2016	% Change
Wedding	$14,267.74	$7,800.00	82.92%
Parents	$8,611.00	$7,653.00	12.52%
Me	$4,891.55	$3,517.79	39.05%
Vacation	$3,573.02	$8,832.68	-59.55%
Food	$2,795.25	$2,729.01	2.43%
Insurance	$2,372.46	$1,208.46	96.32%
Treat	$1,713.17	$716.90	138.97%
Transportation	$1,182.64	$1,307.47	-9.55%
Gift	$992.77	$2,539.04	-60.90%
Credit Card	$939.90	$715.12	31.43%
Entertainment	$372.55	$195.94	90.13%
Health	$324.05	$286.51	13.10%
Gambling	$185.00	$135.94	36.09%
Other	$38.31	$177.50	-78.42%
Clothes	$5.19	$942.08	-99.45%
Investment	$5.00	$0.00	0.00%
Grand Total	$42,269.60	$38,757.44	9.06%

There is a 9.06% increase in the total expenses as compared to 2016! Not surprising at all that wedding expenses came out to be the top. We paid off quite a significant amount of the banquet in advance when Citi had a credit card miles promotion for existing customers, selected/paid partially for a bridal + prewedding package and recently (last weekend!) just purchase our wedding bands over the Christmas weekend.

Regular readers would know that CZM and I have a mutual fund which we contribute monthly. Let me remove the expenses from our mutual expense fund (KPO Expense Fund) and those 1 time expenses such as Wedding.

	2017	2016	% Change
Parents	$8,611.00	$7,653.00	12.52%
Me	$4,891.55	$3,517.79	39.05%
Food	$2,795.25	$2,729.01	2.43%
Insurance	$2,372.46	$1,208.46	96.32%
Treat	$1,713.17	$716.90	138.97%
Transportation	$1,182.64	$1,307.47	-9.55%
Gift	$992.77	$2,539.04	-60.90%
Entertainment	$342.55	$195.94	74.82%
Health	$324.05	$286.51	13.10%
Gambling	$185.00	$135.94	36.09%
Other	$38.31	$0.00	0.00%
Clothes	$5.19	$286.76	-98.19%
Investment	$5.00	$0.00	0.00%
Grand Total	$23,458.94	$20,576.82	14.01%

There is a 14.01% increase in my total expenses! On the bright side, about 33% of the increase came from an increase in allowance which I give to my parents :) This amount will increase next year as I will be getting promoted!

Me
I spent too much on myself this year! I bought a PS4 when FF XV was launched earlier this year. That is like a childhood game/series which I must spend even though CZM keep scolding me for wasting both time and money. lol. I am waiting eagerly for Monster Hunter to launch! Hahahaha. Unfortunately, my Surface Pro 4 which has served me for 2 years was having some issues (vibrating screen after a few hours of usage) so I had to spend money to replace it. I ended up buying a Lenovo YOGA 720 laptop with 3 years warranty for about $2,200 a few weeks back. It has the latest Intel i7 8th gen core, 12 GB RAM and 1 TB SSD. For the same specs, the Surface would have cost me > $3,500 with only 1 year warranty! As much as I love the Surface, I had to give it up. Some other expenses include haircut - $38 for a year! Technically, it is $38 for 12 haircuts which cost about $3.17 per haircut (when you think $10/$12 haircut is cheap). lol.

Food

Lunch	$1,286.65
Dinner	$869.21
Beverages	$396.14
Dessert	$105.30
Breakfast	$84.00
Others	$53.95
Grand Total	$2,795.25

The expense for food is roughly the same as compared to last year.

Insurance

Term - 1 Million	$854.00
Early Cancer Care - 150k	$780.00
Hospitalisation	$421.76
MediShield Life	$316.70
Grand Total	$2,372.46

Although the expenses from insurance were almost doubled (96.32%), there is no change to the coverage. I bought the term insurance and early cancer care late last year hence the full premium was not taken into account.

Treat

Darling	$1,089.56
Family	$488.90
Colleagues	$75.23
Friends	$59.48
Grand Total	$1,713.17

Treat is when KPO pays for the food/drinks. The 138.97% increase in Treat is ridiculous but once I break it down, it makes more sense. CZM and family were the beneficiaries. In the past, when we go out, I would always split everything equally by half. That's why CZM gave me this KPO nickname. lol. Judging from the amount of food she has been eating, you know why she is called CZM.

Transportation

EZ Link	$780.59
Cab	$312.47
Darling Cab	$89.58
Grand Total	$1,182.64

My transportation cost has reduced because I took lesser cab :)

Gift

Wedding	$440.00
Ang Bao	$285.00
Darling	$73.50
Friend	$65.22
Donation	$47.00
Family	$46.75
Colleague	$35.30
Grand Total	$992.77

The Gift expense has reduced significantly because I bought branded stuff for CZM and my family when we went to London, Iceland and Paris last year. I only got them Hang Heung Lao Po Bing (wife cake/biscuit) from Hong Kong and Amanda Brownies from Bandung this year. What a downgrade. lol.

The remaining are smaller expenses which I will elaborate briefly without any breakdowns:

Entertainment - We watched more movies this year and have decided to stop using our university student pass to get discounted student rate movie tickets >.<

Health - Expenses from dental and GP visits which are fully funded by company benefits. I am tracking it so that I know what to expect in the event when the benefits are gone for whatever reason.

Gambling - Damn it. I lost more money in mahjong this year! As usual, CZM would say I drag her down and that I should quit playing mahjong.

Other - Tracking error/missing cash in my wallet. Paid for something but forgot to record in the mobile application.

Clothes - I only bought a shirt from Lazada/Taobao during the 11/11 day for the whole year. Last year, I had to buy winter clothings for Iceland. Guys and girls work differently - guys like to spend on tech gadgets/games while girls spend on clothes/shoes/bags, etc.

Investments - IPO application fee.

I am estimating 2018 expenses to be much higher as we will be getting married next year + our honeymoon to the United States. We have only redeemed a one way ticket so far and I cannot imagine how much the whole trip will cost >.< With the increase in expenses in other areas, I guess the only area/category I can sacrifice is "Me". I will should be spending lesser on myself next year as I already have a lot of gadgets. lol.

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2017 Net Worth

Let me start by wishing everyone Merry Christmas!!!

Net worth is easily one of the most important financial numbers one should know. It is like your personal balance sheet.

This is the classic comic where everyone is actually poorer than the beggar who has a net asset of $2.73. Your friend/colleague may be living in a huge condominium, driving some fancy car but it could all be financed by debts. There is absolutely nothing wrong with that as long as their income allows so. You can refer to the following articles/google on the importance of net worth.

InvestmentMoats - Don’t Track Your Expenses or Budget First. Plot Your Net Worth Instead

Google - Importance of Net Worth

Cash

This is all the money we have in our savings accounts. We are in the midst of transferring our salary crediting account to DBS Multiplier Account because we go wherever there is higher interest! Bye OCBC 360! Shall not reveal the actual amount we have but all of them will be eligible for the higher interest and you can probably try to guess from the pie chart below :)

Our Cash: > $30,000

CPF

Every month, I will try to show CZM her net worth in order to motivate her to work harder towards financial freedom. However, she would always say I inflate her net worth because I included CPF. lol. I am sure some of you may have the same mentality but like I always tell her, whatever that is in CPF is our money and its main purpose is for retirement, not housing.

Screenshot is taken from 2017_MMGPI_Report.pdf 

Singapore has one of the best pension/retirement system in the "world" (ranked number 7 out of 30 countries and number 1 in Asia) according to the 2017 Melbourne Mercer Global Pension Index. I find it extremely amusing when my colleagues from other parts of the world are envious of our retirement system while the locals are complaining so much about it. One of the biggest complain I always hear is the need to repay the "lost" interest when one sells the house but I shall not digress further. lol.

You can refer to these articles for more information:
- Straits Times: Singapore has best pension system in Asia: Mercer index
- globalpensionindex.com: 2017 Melbourne Mercer Global Pension Index

Our CPF: > $100,000 (OA + SA + MA)

Investment

I blogged about our portfolio last week. You can read in detail here - Portfolio Performance in 2017. We have achieved pretty decent return this year (XIRR of 14.85%) and across all years (XIRR of 9.60%).

We have also invested some money through StashAway and the time-weighted return has been decent at 3.5% (SGD) and 5.3% (USD) till date. USD is giving higher return because there is some FX loss when converting the investment back to SGD.

Our Investment: $295,000

Property

I believe that property should be included in the computation of net worth. If one excludes the value of the property, the money (cash/CPF) you use to pay for the loan/mortgage will be no different as disappearing into the thin air or throwing it into the sea. However, I would be conservative by valuing the property at cost/purchase price.

We have only paid the first 5% downpayment so far and yet to start paying for the housing loan (still building). So I will just assume that the remaining $402,420 will be financed by the housing loan/mortgage. That would mean the value of our property is purchase price ($423,600) - loan ($402,420) = $21,180. If you are wondering, it is a 4 room HDB at a matured estate. What is the probability of us being your future neighbour? lol.

Our Property: $21,180

Total

Our Net Worth: $510,000

Here you go! Our net worth pie chart, it looks pretty yummy to me :) CZM was asking if it is possible to hit $1 million by age 30... Shall try to estimate and forecast it another day.

Are you tracking your net worth?

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Portfolio Performance in 2017

2017 will be over soon! I hope everyone manages to meet their 2017 new year resolution if not you have about 2 weeks to do so :)

I believe we will not be buying/selling any more stocks as the year ends so let's take a look at how our portfolio did for the year of 2017.

The overall performance of our portfolio since 2014 is 8.98% (time-weighted return) and 9.60% (XIRR). Yay! We are easily contented, our return is positive and higher than bank/CPF SA interest :) If you are wondering what is the difference between time-weighted return and XIRR, do read this article by common fund. In short, XIRR takes cash flows into account while time-weighted return does not so the way they are calculated is different.

From the graph, you can tell that we have been consistently underperforming the market (benchmark against STI ETF) so do not follow what we buy/sell for better performance. lol. On a more serious note, I blame it on the first year when I started investing trading/speculating on penny stocks without any financial knowledge and broke Warren Buffett rule number 1 - Never lose money.

These are our time-weighted return, monthly volatility and max downdrawn benchmarked against STI ETF over the years. The year of 2014 was ridiculous -14.17% vs STI ETF 5.69%, can you imagine how much of catch up has to be done? 2015 was the turnaround year where I started reading and learning from books and blogs after paying some expensive tuition fee. We went on to beat the market return for the year of 2015 and 2016! Unfortunately, we could not get a turkey. The time-weighted return for 2017 is 16.02% vs STI ETF 21.46%!

The monthly volatility is pretty close to STI ETF and the lower the better. As our portfolio grows bigger and we grow older, the same percentage represents a larger amount of money. Volatility is not good for the heart. Not too sure how to interpret the max downdrawn but you can refer to this article by Investopedia.

The XIRR for 2017 is 14.85% with a capital flow of $94,428.15! Capital flow is the amount of capital that is being injected or withdrawn from your portfolio where the dividends collected are considered as capital withdrawn. We would usually redeploy the dividends collected back into the market hence the actual capital injection is around $84,000. If you are thinking we can do this because we earn big bucks and get demoralized. Please do not! I would like to say we are just extremely thrifty and without any debts. Our rate of saving/investing is at 70-90% of our salary for this year. Both of us are still staying with our parents and they are still feeding us. lol. How much can an accountant (4 years experience) and an IT guy (2 years experience) earn? There is a reason why I am called Kiam Pok Ong (KPO) which meant stingy in hokkien, not K-PO/kaypoh (busybody) which I suspect some readers think that way.

Our portfolio gave us a total dividend of $10,950.63 at an average yield of 4.47%. That is $912.55 passive income per month! The dividends received in 2016 is very high due to the privatization of Saizen REIT (payout in the form of dividend before delisting this year) and a capital distribution by TSH. Unfortunately, the yield of 4.47% is below our target/expectation of 5% and there was a bump by both Saizen and Croesus Retail Trust this year.

Stocks.cafe is even smart enough to project the dividends we will be getting for next year assuming everything remains constant. Seems like it is still at a low 4%, probably need to go back and hunt for REITs. 

Based on our 10 years plan to accumulate a $1,000,000 portfolio for extremely early retirement (age 36), our target for this year was $217,340 and I am proud to say we have exceeded that target with flying colors. The current market value of our portfolio is $293,858. Our next year conservative target is $357,268. Our yearly target is pretty conservative as we believe our expenses will be growing exponentially year on year. We will be getting married next year. Yay! Going on a honeymoon trip to the United States in Suites and getting our BTO house in 2019 which means more $$$ flying away... We have yet to budget for baby/babies too so plan will change! Plans are made to change :)

Let's hope 2018 will be a great and better year for everyone and your investment!

This is not a sponsored post but if anyone of you is investing and not tracking them, you should! If not you will never know how you are doing or learn from your mistake. I will highly recommend you to use/try stocks.cafe which is an intelligent portfolio manager with stocks data for Singapore, Malaysia, Hong Kong and the United States + many reporting features such as what I have shared above.

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StashAway Portfolio Reoptimisation

I received an email from StashAway last Friday (15th December 2017) titled "Your portfolio has been re-optimised".

If you use StashAway and missed the email, you might want to click on this link to see what has been reoptimised in your portfolio.

Let's take a look at what has changed for ours (General Investing - Highest Risk Level at 28)! Do note that the changes in allocations will vary across portfolios due to risk preferences. As stated, the main objective of this reoptimisation is to "harness the undervaluations of gold (GLD) and consumer staples (XLP)".

There are 6 changes in our portfolio as highlighted by the tiny blue dot on the left, next to the respective ETF. We can see that both the gold ETF (GLD) and consumer staples (XLP) have been increased significantly while the other 4 ETFs - technology (XLK), TIPS bond (TIP), 20+ year treasury bond (TLT) and MSCI all country Asia excluding Japan (AAXJ) have been reduced. Do note that once you acknowledge/click "OK", you will not be able to access this information again.

So the next question is why? In fact, StashAway has given a heads up 3 days before (12th December 2017) the reoptimisation. The information can be found in the email titled "Monthly Market Insights from StashAway's CIO" by Freddy Lim and the article is published on their website/blog as well. I will highly recommend you to read his monthly update as it gives a quick update on what's happening to the current economy/market and how it would affect our StashAway portfolio.  

Screenshot is taken from https://www.stashaway.sg/r/cio-insights-november-2017

In summary, there is a valuation gap between the asset (gold and consumer staples) vs the economic fundamentals based on their complicated modeling. Do read the article for more information!

This is something which I like, the ability to reoptimise our portfolio at no additional cost. Indeed investing redefined.

StashAway Referral Link for Our Readers
Here you go: KPO and CZM Referral Link

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Book Review - The Automatic Millionaire

During the last weekend, CZM hijacked my laptop and was using it to work. Out of boredom, I googled for the "best finance books to read in 2017" and came across the link by Business Insider - The 25 best personal finance books to read in 2017. As I read the article, this particular book, The Automatic Millionaire by David Bach caught my eye.

As recommended by one of the readers during my last book review (Book Review - Building Wealth through REITS), we can borrow the book from the National Library Board mobile app/site and use OverDrive to read for free! You will need to sign up for a myLibrary ID with NLB first.

I enjoyed reading the book as it was interesting, easy to read and teaches important concepts with various examples. There are 9 chapters in total (estimated reading time by Overdrive is 3 hours) and I will briefly share some of the content that resonated with me.

Screenshot from the book, page 63-64

The Latte Factor
Everyone knows this, spending money on a cup of coffee in Starbucks ($5+) vs hawker/food court ($1+). Indulging once in a while is fine but buying it every day, is it really necessary? The latte factor is not limited to just coffee, it can be anything (cigarettes, atas restaurant, etc.)!

Screenshot from the book, page 65-66

Assuming if you were to save the money and invest them, you can become a millionaire too! The author recommended tracking your expense for a period of time (a week/month) in order to find your latte factor.

Pay Yourself First
We work hard to earn money and every month we will be paying bills, loans, taxes, etc once we receive our salary. How often does one pay himself/herself first by saving for retirement?

Screenshot from the book, page 109-110

The context is based on the 401k and IRA in the United States but the idea is pretty relevant in Singapore too which will be our CPF and SRS. The author recommended one to "pay" himself first by contributing to the retirement account and using pretax money to invest. The idea is simple, every dollar that I earn (take-home pay), that dollar will be taxable by IRAS as income tax. However, if I were to transfer the money into CPF or SRS, that would no longer be taxable and I can then invest more.

I blogged about the CPF RSTU previously on how it can easily be one of the best investment (no/low risk and high return). Topping up $7,000 at one shot can be a lot but one can break it up into 12 payments. The moment your salary is in, credit $583 into your CPF and pay yourself first instead of our government. lol. The author recommended doing this automatically which is possible in the US. Unfortunately, I could not find a GIRO/automatic option for our CPF. As pointed out by a reader (jusiu), it is possible to GIRO the RSTU! The form can be accessible here - RSTU Giro Form :)

Making It Automatic

Screenshot from the book, page 133-134

After saving up, the next thing is to invest your money. The author recommended investing in mutual funds or ETF as they offer great diversification. Interestingly, in the latest edition of his book, he included robo advisors as an alternative and recommended the bigger firms such as Betterment and Wealthfront. Unfortunately, we cannot use our CPF or SRS to invest through any of the robo advisors in Singapore.

The book also discusses other things such as having sufficient emergency fund, not having any credit card debts, how to get out of debts and donating money to charity. You can refer to the below "Millionaire Blueprint" for a quick overview.

The Millionaire Blueprint

Screenshot from the book, page 257-258 or http://finishrich.com/blueprint/

I highly recommend one to read this book!

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APAC Realty

We have purchased 12,000 units of APAC Realty last week (7th December 2017) at $0.86. The IPO price was at $0.66, opened at $0.695 on 28th September 2017 and went as high as $0.975! At the point of writing this article, the price is currently at $0.865.

The latest 3rd Quarter financial statement was pretty good where the revenue till date for the year (9 months) improved by 30.3% and the profit by 64.6%!

In its IPO prospectus, using the adjusted 2016 EPS of 4.47 cents and IPO price of $0.66, the PE ratio was about 14.76. If we were to use a more conservative approach, we know the PE for 2016 is 4.47 so the EPS for the last quarter is probably 4.47 - 3.52 = 0.95. Assuming that the remaining 2017 (last quarter) would perform as good/bad as 2016, the full year EPS estimate would be around 5.78 + 0.95 = 6.73. At our entry price of $0.86, the PE ratio is at 12.78!

Alternatively, we can also estimate the EPS by averaging and extrapolating it to give 5.78 / 3 x 4 = 7.71. That would bring the PE ratio down to 11.15! If the market is willing to pay/value it at 14.76 PE initially, the price should go up to $0.99 to  $1.14? Does this mean it is currently cheaper than it first IPO or it is a must buy? I do not know. lol. The above numbers are just estimations made by a regular IT guy based on one of the many financial ratios. Do take it with a pinch of salt :)

Taken from RHB Research Report

What we like about the business is that it is easy to understand - real estate brokerage services (commissions) and other revenue from training fees, franchise fees, etc.

The other revenue only contributes about 2-3% as compared to the core real estate brokerage services. Do you foresee Singapore property market recovering/getting better?

For more in-depth analysis, do read what the pros have written:
- Singapore IPOs: APAC Realty
- SmallCapAsia: APAC Realty
- SG Investors.io: DBS Research - $1.12
- SG Investors.io: RHB - $1.20

Do like any of the following for the latest update/post!
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StashAway - November 2017

USD has fallen slightly which is great for those shopping at Amazon during Black Friday and Cyber Monday but not so good for our StashAway portfolio. lol.

On a side note, I realized that the statement is different again this month!

1. ACCOUNT SUMMARY (as of the last day of the month)

The exchange rate at the start of the month was 1 USD = 1.3608 SGD as compared to 1 USD = 1.347 SGD at the end of the month. What does this mean? If you are optimistic, it means that you will be able to buy more underlying ETFs units for the same Singapore dollar (assuming the price of the ETF remains constant) going forward. On the other hand, it also means that your current USD investment/portfolio is worth lesser as compared to when you first invested which is why our portfolio would be experiencing a negative currency impact. On the bright side, our capital is SGD $2,500 so there is a $36.57 profit even with a -$20.06 currency impact.

2. PORTFOLIO DETAILS 

We receive USD $0.92 dividends which have been paid and reinvested.

3. TRANSACTIONS

I still hate the fact that we are not provided the exchange rate when the SGD deposit was converted to USD.

4. FEE CALCULATIONS

No fee this month because I recommended a friend. The projected fee (assuming no referral) would be the monthly-average assets SGD $2,091.63 x 0.8% / 365 days * 30 days = $1.38

So what has changed?

They added an appendix to provide explanations for the various financial terms used in each section of the statement. I thought this was pretty neat and helpful to those new to investing.

Saving the best for the last, I shall be revealing the most interesting change! KPO has sharp eyes/attention to details (CZM says self-praise is no praise). Drum roll please! lol.

Above is a screenshot of both the October and November statement side by side. What do you see? Yes! There is a GST Registration number! Ever wonder why some shops/eateries do not charge GST while some do? According to IRAS website - GST Registration Liability, this can only mean 2 3 things for StashAway.

You are liable for GST registration if:

1. Your taxable turnover at the end of the calendar quarter (i.e. 3 months ending Mar, Jun, Sep or Dec) and the past three quarters is more than $1 million. ("Retrospective View")
2. You can reasonably expect your taxable turnover in the next 12 months to be more than $1 million ("Prospective View")

3. Alternatively, as some readers have pointed out, it is possible to register for GST voluntarily but why register for it now and not right at the start?

A quick search on the IRAS portal revealed that they registered for GST on 3rd November 2017. Whether StashAway has already made $1 million in the last few months or will be making $1 million in the next 12 months, I would view this as a piece of good news similar to those where companies are conducting shares buyback or insiders buying more shares. This is definitely a boost of confidence for those that are worried that the company would close down/go bankrupt. lol. This is purely my opinion.

StashAway VS STI ETF
Since there is no way to compare the performances among the robo-advisors, I came out with a spreadsheet to track our StashAway portfolio performance (General Investing - Risk Level 28) against that of STI ETF which I will be updating on a monthly basis. For simplicity, I shall assume that one can either invest in Nikko STI ETF using POSB Invest-Saver or invest in SPDR STI ETF using SCB Priority Online Trading (no minimum commission). These would be the opportunity costs while we continue to invest in StashAway.

This month commentary: In terms of absolute P&L, StashAway return is ranked number 2 at 1.4%. Using SCB Priority Online Trading to invest in SPDF STI ETF has the highest return at 2.19% as compared to using POSB Invest-Saver to invest in NIKKO STI ETF with the lowest return at 1.12%. Although both STI ETFs are tracking Singapore Straits Times Index, the difference in return can be attributed to the effect of fees/commissions due to the usage of different platform to invest. The same can be said when one chooses to invest in ETFs vs unit trusts/funds - fees/costs matters.

Apart from the absolute P&L, we should also look at the Reward-to-Risk Ratio where risk/volatility is taken into account. For more information, do read StashAway Clarifications - Reward-to-Risk Ratio. StashAway has the highest ratio of 0.98 which is significantly higher than the other 2 STI ETFs. Let me quote Freddy Lim (Co-Founder & Chief Investment Officer of StashAway), "for every dollar of risk taken, StashAway P28 is producing 0.98 times the return".

Which is the best? Only time will tell :)

This is the link to our spreadsheet - KPO & CZM StashAway Portfolio VS STI ETF which I have also added to Our Portfolio page.

StashAway Referral Link for Our Readers
Here you go: KPO and CZM Referral Link

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Portfolio Update - November 2017

Our portfolio shrank by -1.86% to $281,122 - $3,434.19 of capital injection and -$8,761.19 of  capital growth/reduction. We enjoyed a $9,925.66 of capital growth in October 2017 and that has disappeared faster than expected. In short, the decrease is due to the property stocks retracing back to the previous level.

SOLD
- MindChamps (5,000 units) @ $0.9

I blogged about MindChamps in the previous article - What's Harder than BTO? IPO. Our initial plan was to hold it for the long term but due to a change in government policy, we decided to put a stop loss and the stop loss was eventually triggered. It was still a decent profit for about 5 days - $104.11 (+2.4%) and an annualized return of +454.5%!

BOUGHT
- MindChamps (5,000 units) @ $0.875
- Capitaland (1,000 units) @ $3.53

We decided to buy more Capitaland when the majority of the property stock price decreases last month. Capitaland is the largest local developer in terms of market capitalization  (GLP will be delisted soon) and it is well positioned for more growth by expanding into other countries instead of bidding aggressively/en bloc for land in Singapore.

Dividends
The total dividends collected this month is $598.01. The breakdown is as follows:

Company	Symbol	ExDate	Shares	Total
Geo Energy Resources Limited	RE4	24-Nov-17	18,000	$180.00
Singapore Post Ltd	S08	23-Nov-17	7,000	$35.00
Frasers Logistics & Industrial Trust	BUOU	08-Nov-17	8,000	$134.40
Far East Hospitality Trust	Q5T	08-Nov-17	10,156	$104.61
Starhill Global Real Estate Investment Trust	P40U	02-Nov-17	12,000	$144.00

Total dividends collected for 2017: $10,697.23
Average dividends per month for 2017: $891.43

StashAway

Capital: $2,500
Current: $2,536.26 (IRR: 2.8%)

Do take a look at this article if you missed it - StashAway Clarifications - Reward-to-Risk Ratio where Freddy Lim (Co-Founder & Chief Investment Officer of StashAway) clarify how StashAway is optimising return by taking on lesser risk.

StashAway Referral Link for Our Readers
Here you go: KPO and CZM Referral Link

Health - KPO Needs to Lose Weight
Date: 2017-12-04
Weight: 74.4 kg (Lost close to 9kg already!)

BMI: 24.8

What's Harder than BTO? IPO

I always thought applying for a BTO was hard, until I try IPOs! $6 for 3 tries but did not get any!

Even though we did not get any shares from the public tranche, we decided to purchase MindChamps from the market and hold it long term because we believe that parents are willing to spend money on their children to give them the best. So I place an order before the market open at $0.84 but did not get any (not sure why). I continued to chase (kept modifying the order) the price and finally got in at $0.875 for 5000 units. MindChamps went on to close at $0.92!

On Monday (27th November), MindChamps closes at $0.96 which means it was trading at a PE of 43x! However, the next day, MOE releases a news -
MOE kindergarten kids get priority admission to co-located primary schools from next year which would definitely have an impact on private preschool including MindChamps. Not sure if MOE is trolling or already give face to MindChamps by releasing the news at this time. lol. The price went on to close at $0.915.

Appeal of MOE Kindergartens will shoot up, parents say. Parents simply want the best for their children and this news is a big deal! We decided to put a stop loss at $0.90 and guess what? We got kicked out today with a little bit of profit $104.11 (+2.4%) and an annualized return of +454.5%! So much for holding long term. Hahaha.

Should we chase No Signboard tomorrow? Probably not. Since the public tranche is 268.6 times subscribed, the public demand should be huge! Huat to those that got it!

Redeeming KrisFlyer Miles for Singapore Airlines Suites = 38.6% Cashback!

One of our goals is to accumulate enough miles to fly to the United States in Singapore Airlines Suites for our honeymoon - once in a lifetime experience! We have finally turned that dream into a reality after 1.5 years of hard work (having > 10 credit cards and using the right credit card on the right occasion) with a confirmed Suites booking.

The last time we used miles for our flight - KrisFlyer 50% Redemption Promotion on SilkAir, the cashback equivalent for our return Economy SilkAir flight to Bandung was around 6.5%. What about this time round?

2 one way ticket to New York, John F. Kennedy International Airport can be redeemed for 240,000 KrisFlyer miles + $259.60! Let's take a look at how much it would cost to purchase the exact same ticket/flight for the same day.

Total fare (all in) would have been $23,419.60! We will never pay this amount of money for a flight! The correct way to generate/accumulate miles is to do it through specialized spending (paywave, dining and online) where one will be earning 4 miles per dollar.

As you can see, the miles earned on average till date is about 4 miles per dollar. The reason why UOB and Citi are below 4 is that there are general spending credit cards (UOB PRVI Miles and Citi Premier Miles) giving about 1.2 - 1.4 miles per dollar. SCB is on a different level because we simply signed up for the Visa Infinite card and paid the annual fee without any spending.

With this assumption, the estimated spending would be around $60,000 (240,000 / 4).

Simple maths:
240,000 miles = $23,160 ($23,419.60 - $259.60)
Cashback equivalent: $23,160 / $60,000 = 38.6%

Wahahahaha. Can cashback card beat that? Milelion shifu/master has already written an article about it so I will not go down that path - The ugly truth of cashback cards banks don’t want you to know.

Our miles journey started March 2016 and our 1st card was AMEX Ascend.

During this period, we had quite a few major expenses such as CZM's ring, wedding banquet, those holidays to London, Iceland, Paris, Hong Kong and Bandung, etc. that gave us the opportunity to accumulate miles at a much faster. We have to thank our parents as well whenever they take out cash to make payment, it will be intercepted by us and replace with our credit card. lol.

The question is should you cancel all your cashback credit card and start accumulating miles? My answer would be nope! Similar to all financial decisions, there is no one/best way to go about doing things. Before we started, we spent hours reading all the articles in Milelion to ensure that we know what we are getting into!

Miles may not be suitable for you due to the following reasons:

1. There is an expiry to it and we know cashback does not expire (but there is a cap/limit). lol. If you cannot generate miles fast enough, it might not be ideal for you. Credit card points expire around 1/2 years so you have to transfer the points out to KrisFlyer miles which has an expiry of 3 years. In total, the lifespan of miles would be around 4-5 years.

2. Devaluation of miles! Collecting miles would mean you will be at the mercy of the airlines. Our initial goal was to get return tickets to the United States but SQ devalued its KrisFlyer earlier this year which I blogged about previously - Felt Cheated by OCBC & SIA on the Same Day. In the end, we got to change our plan instead to one-way tickets.

3. Big family. First class/business ticket for your child/children does not really make sense.

4. You prefer to have only 1/2 credit cards for whatever reasons (too many cards make the wallet fat, forget to pay bills, etc.) because the common misconception is that people think they can accumulate miles with just 1 credit card. Sure, never say never :)

5. It is your principles in life that you will NEVER EVER pay any credit card annual fee. It is perfectly normal, we used to think that way too. However, playing the miles game would require you to do that because that is the best arbitrage opportunity! KPO simply cannot resist the thought of paying $2 for a $10 service.

The simple maths behind paying for annual fee:
Citi Premier Miles: $192.60 / 10,000 miles = 1.926 cents per mile
SCB Visa Infinite: $538.5 / 35,000 miles = 1.539 cents per mile
Singapore Airlines Suites: $23,160 / 240,000 miles = 9.65 cents per mile

6. Last but not least, "I am not interested in flying First Class/Business, Economy will bring me from point A to B just fine". The choice is obvious then. Stick to your cashback cards :)

Having said that, we do have cashback card where we make sure that we spent at least $500 on our OCBC cards every month to get the additional interest and everything else goes into miles. Who says one cannot have the best of both world? Hahahaha.

Hope that this article will encourage you guys to start playing the miles game or reinforce your plan to continue using cashback cards. No right or wrong :)

Time to research on what are the must do, must eat, must visit places in the US! We also need to look for a cheap economy ticket back... Hahaha.