A Path to Forever Financial Freedom (3Fs)

Blessing or Curse of Financial Freedom knowledge

2013-05-20T07:50:00.001-07:00

Ever since I embarked on my journey towards Financial Freedom 3 years ago, I have been keeping a frugal lifestyle in mind so that I will not be trapped into a financial sorry situation. Even though I was financially literate by the time I finished my studies, I was realistically financially illiterate. I went from a hero graduate student to a zero net worth junkies. And then one day I had a dream. A dream that I could be successful. A dream where my time is my own. A dream where I can wake up when my body is ready, go to sleep when I am tired and never again live by schedules other than my own. I am a changed person now.

Now, we often hear people around us complaining about their financial situation. A few, we may argue, are worth a sympathy but most are plain ridiculous. We hear people complaining about how they messed up financially and how undeserving they are. We see registered and unregistered people complaining in yahoo news everyday on how incompetent is the goverment. The way they are acting is as if the goverment owes them a living. To put simply, these people are plain losers who talk more than they act. In my opinion, I don't see how they can have time to complain every single day but yet denies having any time to earn extra income and plan their lives. It seems like all they need was our consensus sympathies.

What surprised me the most is that as I become more financially literate myself, my sense of frustration would grow upon hearing all these complaining stories. I try to empathize with their situations from time to time but at a certain point, you just know that it's hopeless. When someone is ready to change, they will. All I can do is to advise, guide and lead by example. The rest will still be up to them to take the lead to change their lives.

What about you? Do you consider your knowledge a blessing or a curse? Does it frustrates you to hear people complaining about their financial situations all the time?

QAF: Dividend Reinvestment Plan

2013-05-17T05:08:00.002-07:00

QAF Ltd has recently announced a Dividend Reinvestment Plan (DRIPS) for the financial year ended 31 December 2012 to allow its shareholders to reinvest their cash dividends by purchasing additional shares of the aforementioned company.

In a normal circumstances like this, I usually prefer to receive the dividends in the form of cash option. I don't generally like to hold on to odd lot shares as I find it very difficult to remember and also to sell in the open market. However, what is attractive about the offer is that for investors who chose the DRIPS option, they will have the opportunity to purchase it at the issue price of S$0.891/share, which is about 7% discount to its current price of S$0.955.

Now, we are seeing more and more companies doing this in order to attract their investors to reinvest their dividends into the company in view of the long term outlook. A fellow blogger, AK71, had recently blogged about how AIMS AMP Reits are doing the same thing with regard to their DRIPS option.

Will I take the offer? I would love to do so if I own a larger amount of shares in the company. But with only 3 lots, the dividends (S$120) would only allow me to purchase 0.134 lot (134 shares) and it will make it very complicated for me should I decide to dispose all my holdings for QAF in the open market one day.

I am taking cash this time.

What are the consequences we will face after all these easy monetary policy?

2013-05-15T05:23:00.002-07:00

The video below will show the aftermath consequences of all the easy monetary policy of printing money going on across the globe today. It is a really good video. So you should watch it.

Recent Buy: Vicom Ltd

2013-05-13T05:00:00.000-07:00

I've recently purchased some small lots of Vicom Ltd at an average price of S$4.91 (See my transactions here).

I've been bracing up for more defensive plays in recent weeks in view of the market euphoria from DowJones and S&P to STI. I tend to be a bit cautious when everyone is too optimistic. I feel like it is about time I should rebalance the higher gearing shares in my portfolio to those with stronger balance sheet in view of the rising interest rates we might probably see by end of the year. Neratel, ST Eng, Boustead and most recently added, Vicom are a few exemplary leaders in my new look portfolio with a very strong balance sheet - net cash, no debt.

Why did I purchase Vicom?

Vicom's nature of business is no stranger to anyone.

It has a great business moat with steady earnings profile and strong balance sheet. Most recently, it announces a decent Q1 2013 results with 6.7% increase in net profit compared to Q1 2012. Whilst operating margin has decreased slightly from 35.2% to 34.8%, EPS has increased moderately at 6%. Annualised Free Cash Flow (FCF) for the year looks to be in the range of S$26M while dividends paid out (payout ratio of 60%) is around S$16M. This means that the rest of the S$10M will go into Vicom's Cash and cash equivalent which at the end of Q1 2013, has increased to a record high of S$71.7 Million.

As COE prices continue to be volatile, there will be an increase of older cars on the road requiring annual inspections. This will give recurring business income to Vicom.

If there is one thing negative about Vicom, it is that they are trading at their historical P/E high of 16.07. Comfortdelgro P/E ratio is at 16.69 while SMRT P/E ratio is at 26.50. So depending on how you are looking at it, you can view them as "cheap" or "expensive".

I am not a true and blue advocate of a value investor myself. Some people would love to buy a normal company at a great price. I think in Vicom I am buying a great company at a normal price.

For a thorough analysis on Vicom, you can view here by a fellow blogger which he did last year. I thought the analysis was very thorough and impressive.

"May 13" - SG Transactions & Portfolio Update"

2013-05-08T06:19:00.003-07:00

Counters	No. of Lots	Average Price (SGD)	Total Value (SGD) based on average price	Market Price (SGD)	Total Value (SGD) based on market price	Total Dividends collected (SGD) since purchase
FraserCenter Point Trust	11	1.69	18,590.00	2.26	24,860.00	1,509.00
SPH	5	4.15	20,730.00	4.38	21,900.00	350.00
Boustead	13	1.15	15,020.00	1.40	18,200.00	140.00
SIA Engineering	3	4.12	12,360.00	5.29	15,870.00	210.00
First Reit	10	0.89	8,900.00	1.415	14,150.00	693.00
Ascott Reit	9	1.305	11,745.00	1.425	12,825.00	386.00
Neratel	20	0.46	9,200.00	0.625	12,500.00	1,200.00
SembCorp Ind	2	5.44	10,880.00	4.98	9,960.00	300.00
PLife Reit	3	1.85	5,550.00	2.76	8,280.00	556.00
Ascendas Hosp. Trust	7	0.89	6,250.00	0.995	6,965.00	319.00
Second Chance	17	0.43	7,210.00	0.42	7,140.00	456.00
CWT	4	1.43	5,730.00	1.765	7,060.00	120.00
STX OSV (Vard)	6	1.245	7,470.00	1.05	6,300.00	0.00
YZJ	6	0.95	5,680.00	0.90	5,400.00	300.00
ST Engineering	1	2.82	2,820.00	4.37	4,370.00	1,378.00
QAF	3	0.71	2,135.00	0.945	2,835.00	140.00
Noble	2	1.12	2,240.00	1.165	2,330.00	0.00
Total SGD			152,510.00		180,945.00	8,057.00

This month, I sold off my only telecom share, Singtel which I had at a very nice price of S$3.93. The share price has moved up nicely in tandem with the other telecom shares of Starhub and M1 which gave me the opportunity to sell it off at a good profit. I thought the way the price has moved up is overboard given its overseas earnings (especially Optus and Bharti) still a drag on Singtel overall performance.

I also took some profits off FCT after it went x-dividend and this is not the first time I'm doing this given its stellar performance year to date. FCT still remains my number one top holdings even after the sell.

My big purchase for the month is the accumulation of Boustead. With the purchase, I now own 13 lots of Boustead at an average price of S$1.15, which to me still boasts a margin of safety in my opinion. FY2013 performance so far has been phenomenal for Boustead. EPS for the 9 month period FY2013 alone has almost equaled EPS for the full year FY2012. With such a stellar performance this financial year, I am almost certain that Boustead will announce a dividend of at least 7 cents/share (5 cents to be announced shortly in its May results and another 2 cents in November). At its latest closing price of S$1.40, this translates to exactly 5% yield.

What I like about Boustead also is that it has a policy of buying back its shares, which is why you see the number of outstanding shares have been gradually lower every year. After all, we are talking about a company which boasts a huge pile of cash in its balance sheet.

Boustead has also recently divested its entire holdings in OM Holdings Limited, an integrated manganese mining company listed on the Aussie Exchange. The divestment is good for the company because this was a wall of worry amongst investors and Mr. Wong himself. In the recent interview, he even admitted that he can at times make a mistake. Having said that, Boustead recorded a divestment gain of S$5 Million which is huge and based on FRS reporting the gain should be recognised as "Other Operating Income" in FY 2014.

This has been a fantastic month in terms of dividend income for me. My portfolio is my way to freedom and I can see how the generation of cashflow through these dividend income streams have helped me in paying my expenses. Although these portfolio updates every month show the increase in the underlying value of the equities I am invested in, it is the rising income stream which is more important to me. With that said, my lovely dividend income stream this month includes:

FCT = S$324

SPH = S$350

First Reit = S$174

Neratel = S$800

Sembcorp = S$300

AHT = S$256

CWT = S$120

YZJ = S$300

ST Eng = S$138

QAF = S$120
Noble = S$40

Total = S$2,922

With many people advocating "Sell in May and go away", it is important to stay focus and ignore the noise. Instead of diverting your attention on such uncertainty, why don't you focus your attention more on the companies you are interested in?

Have a good week everyone :D

Ascott Residence Trust (ART) - Corporate Action

2013-05-03T23:15:00.000-07:00

I received a circular from Ascott Residence Trust (ART) this morning regarding a corporate action required from Ascott shareholders.

Ascott Residence Trust (ART) proposes to seek the approval of Unitholders for the Target Acquisitions of 3 Service Residence based in China and 11 Residential properties based in Japan.

China

Citadines Biyun Shanghai, Shanghai.
Somerset Heping Shenyang, Shenyang.
Citadines Xinghai Suzhou, Suzhou.

Japan

Actus Hakata V-Tower
Big Palace Kita
Grand Mire Miyamachi
Grand Mire Shintera
Gravis Court Kakomachi
Gravis Court Kokutaiji
Gravis Court Nishiharaekimae
Grand E'terna Saga
Grand E'terna Saga Idaidori
Grand E'terna Nijojomae
Grand E'terna Chioninmae

Costs of funding the Target Acquisitions

The aggregate costs for the target acquisitions are expected to be equivalent to S$166.8 Million. The company will fund almost 90% (i.e S$147.8 Million) of the costs through the net proceeds raised from a private placement earlier in Feb 2013. The rest of the 10% (S$19 Million) will be funded through debt financing. This increases Ascott net gearing from 40.1% to 41.2% upon successful completion of the acquisitions.

Increased Dividends Per Unit (DPU) for Shareholders

The acquisitions are expected to increase distributable income by S$14 Million for FY2012. Dividends Per Unit (DPU) is expected to increase by 2.9% from 8.76 cents to 9.01 cents. At last closing price on Friday of S$1.405, this translates into a dividend yield of 6.4%.

Valuations of Target Acquisitions

Ascott has engaged Independent Valuers, Colliers and HVS to assess the open market values of the Target properties. The "Income Approach" - using the expected future income cash flow is used to value the assets. To arrive at the appraised values for the properties, both valuers adopted a 10 year cash-flow and applied a terminal cap rate. The projected cash flow are then discounted based on a DCF discount rate.

Citadines Biyun Shanghai - Valuation using the above metric stands at RMB 325,000 (~S$63.5 Million). The target purchase costs from Ascott is S$53.8 Million.

Somerset Heping Shenyang - Valuation using the above metric stands at RMB 444,000 (~S$86.5 Million). The target purchase costs from Ascott is S$59.4 Million.

Citadines Xinghai Suzhou - Valuation using the above metric stands at RMB 122,000 (~S$23.5 Million). The target purchase costs from Ascott is S$14.7 Million.

Independent Advisor - PWC

After considering all factors, PWC has advised the Independent Directors to recommend that Unitholders vote in favor of the Transactions to be proposed at the EGM.

My Thoughts

I thought this is a good acquisition opportunity for Ascott to expand its geographical expansion in China and Japan. Its China portfolio will increase from 9.8% to 14.7% while Japan portfolio will increase from 12.2% to 14.9% after the acquisitions. More importantly, it will tap into the emerging market of Shenyang and Suzhou respectively, something that they have not done in the past.

The acquisitions will also be yield accretive, giving an DPU increase to shareholders of 2.9% from 8.76 cents to 9.01 cents.

If there is one thing that I am worried, it is that their net gearing is pretty high. The private placement done in Feb 13 has helped to strengthen their balance sheet by reducing their gearing from 40.1% to 36%, much to my relief. Now with the acquisitions, their gearing is back to a higher level at 41.2%. It looks like the placement is an intended move to fund the acquisitions project and not used to repay its borrowings. The amount of short-term repayable debt is huge and with a dividend payout of almost 100% to its shareholders, it looks like another private placement or rights issue may be on the cards once again within the next 1 year. If not for the potential rights issue, I may pick this stock up anytime below S$1.40.

The acquisition news does not seem to come too well for Ascott shareholders. Ascott share price has dropped from S$1.45 prior to the news to S$1.405 after the announcement.

How are you coping with your 9 - 6 working lifestyle?

2013-05-03T19:51:00.001-07:00

I've recently been bugged down again by the culture of working late into the office at night and during the recent public holiday (labor day), such to an extent that it gets me thinking again on the rationale of working for such a corporation. It is the sort of corporation that shaped and designed my lifestyle that does not fit my desire. I could have walked away from it, but after thinking of all the external factors, it doesn't seem all too easy and rationale. But I do not blame the company. I spend my weekends recharging my aching body and brainwashing my mental mind so that when the new week commences, it is an entirely fresh start to begin with.

The problem with most of these companies we are working for is that they did not make their millions and billions of their revenues by earnestly promoting the value of their products. Instead, what they did was to create a culture where it envisages the minds of hundred of millions of people to buy their products that they do not need with money that they do not have to satisfy the people that they do not like. Credit cards, starbucks and luxury goods are all culprits of such corporations in our modern society.

The reason why companies create a culture of this sort is to sustain an environment where working staffs like you and me build our lifestyle in the evenings and on weekends. You simply try to fit in your desired lifestyle into a limited time of evenings and weekends, especially after spending almost 40 to 60 hours a week on your project and work.

Advance in technology and productivity enhancement in recent years have led us to falsely believe that we might be able to work for lesser hours while producing the same amount of quantity and quality of work. But we are proven terribly wrong. Companies will take advantage of this to give us even more work and to increase more revenue for the company.

Today, we’ve been led into a culture that has been engineered to leave us tired, hungry for indulgence, willing to pay a lot for convenience and entertainment, and most importantly, vaguely dissatisfied with our lives so that we continue wanting things we don’t have, we don't need and we don't like. We purchase these items because it always seems like something in our life is missing.

To my dear friends who are walking the same path as me, our goal is near. We are almost there. It all seems too easy to simply give up and resigned to your fate right now. But it would not change anything and we know we can change this. We can make this happen. Perseverance is one trait that we all will have successfully learnt should we walk out as winner in this journey.

Review of Neratel Q1 2013 Results

2013-04-26T08:22:00.001-07:00

Nera Telecommunications reported their Q1 2013 results under their new management team which saw their overall profits for the quarter drop below the S$6m mark.

Revenue for the quarter dropped from S$43.5m to S$36.4m due to decline in their "Telecommunication" business segment. The decline was mainly attributed to lower sales of their microwave radio equipment and Satellite equipment in the Asia Pacific and Middle-East/N. Africa markets. There was also a delay in projects related to their network infrastructure equipment that resulted in lower revenue for the quarter.

The good news however, is that gross margin has improved from 35.5% to 41.6% in both the "Telecommunication" and "Infocomm" business segment due to more competitive sales mix-in products and services. Operating and other admin expenses increase marginally year on year.

Earnings per share (EPS) has dropped from 1.79 cents to 1.62 cents this quarter.

Healthy balance sheet - If there is one thing I like about Neratel, it is because they keep their balance sheet simple and safe. The company is in the net cash position and debt free for a number of years now. Their cash equivalent and retained earnings made up almost 60% of the entire balance sheet and you can see how that they can keep up giving 4 cents dividends for the past couple of years.

Payment Solution business is expected to grow in the market driven by the increasing spending and transactions and government initiatives to promote cashless payment. The growth is evident with an increase of 55.2% this quarter alone.

Growing Myanmar story - Entry of the telecommunication infrastructure and payment solution business into the growing Myanmar market signifies growth potential for the company. This is evident just by looking at how Singtel bid aggressively for the license to operate in the Myanmar market.

Risks - New management team. It is interesting to see how the new management team drives the direction for the company. Personally I would have preferred that the new management focuses more on expansion into the geographical neighbouring market rather than M&A activities.

Risks - Increasing competition from its "Telecommunication" and "Infocomm" segment, in particular the wireless and network infrastructure.

Conclusion

It's going to be hard to see any upside to the stock at this moment. The company is going through a transition period in terms of the future direction the new management wants to set. At current closing price of 67 cents, the yield is close to 6% which looks to be sustainable given the strong balance sheet they had. Profits look to have dipped below the S$6m mark and is worrying if this trend continues in the next quarter. For your info, OSK DMG issued a report on Neratel in Feb 13 with target price of 72 cents which I think look terribly unlikely given that the optimism to project a 10% increase in profits in 2013. For investors, I would rather adopt a wait and see attitude to monitor the next few quarter results to determine whether I will go long for the stock.

I am vested with 20 lots of Neratel at the moment.

Home of Chairman of Biosensor International

2013-04-26T05:31:00.001-07:00

Like most business travellers, Yoh-Chie Lu would stay in a hotel whenever he came to Singapore for work. Unlike other travellers, he did that for over 30 years. Finally, the chairman of heart stent-maker Biosensors International has decided he's had enough of living out of a suitcase.

"I am spending more time in Singapore and with a permanent base, my family can come visit too," he says. His wife, Kimino, and their two younger daughters, Raena and Yuka, live in the United States, and visit at Christmas. Eldest daughter, Julie, who manages her father's investments and assets, lives with him in Singapore. The family knew what kind of home they wanted to have: not a bungalow because that would require high maintenance, but "something cosy and easier to maintain that would suit our living style," says Mr Lu.

Whereas he would spend about three weeks each time in Singapore, now he stays for "months", spending half the year here. Their home in Singapore is a four-bedroom apartment in Nassim Road. Apart from the US, the family also has a home in Japan.

"At the end of the day, it is more comfortable to come home and sink into your favourite chair, instead of facing the four walls of a hotel room," says Mr Lu. Roy Teo, founder of The Mill, a group of interior design companies was brought in to turn the apartment into a home. The look is contemporary, and yet soothing.

Finally, the chairman of heart stent-maker Biosensors International has decided he's had enough of living out of a suitcase. "I am spending more time in Singapore and with a permanent base, my family can come visit too," he says. His wife, Kimino, and their two younger daughters, Raena and Yuka, live in the United States, and visit at Christmas. Eldest daughter, Julie, who manages her father's investments and assets, lives with him in Singapore.

The family knew what kind of home they wanted to have: not a bungalow because that would require high maintenance, but "something cosy and easier to maintain that would suit our living style," says Mr Lu. Whereas he would spend about three weeks each time in Singapore, now he stays for "months", spending half the year here. Their home in Singapore is a four-bedroom apartment in Nassim Road. Apart from the US, the family also has a home in Japan. "At the end of the day, it is more comfortable to come home and sink into your favourite chair, instead of facing the four walls of a hotel room," says Mr Lu. Roy Teo, founder of The Mill, a group of interior design companies was brought in to turn the apartment into a home. The look is contemporary, and yet soothing.

The zen garden blends well with the estate's landscaping, which was incidentally designed by Japanese landscape architect/priest Shunmyo Masuno. The bespoke ceiling lamps in the dining and living areas resemble modern Chinese lanterns. Timber sliding screens by the balcony are great for blocking out the tropical sun. Mr Teo kept the apartment's colour palette neutral so that the apartment would still look stylish many years down the road. Shades of beige, white and khaki-browns fill the rooms. Having grown up in the US, where her home is much bigger, Ms Lu was initially surprised by how small her bedroom is, made even smaller by the bay windows. To maximise the space, Mr Teo designed a table to fit over the bay window, so that the space can be used as a desk. He also designed for the side console to be lower than usual. "Somehow by making things smaller, the room looks bigger," says Ms Lu. For another bedroom, Mr Teo designed seating over the bay window, alongside a linear cupboard. The Lus reflect their background not only through their apartment but also in their choice of artworks. An installation by American artist David Datuna hangs on the wall. Part of the Viewpoints of Million series, from afar it is a picture of the American flag, but up close the installation depicts things that symbolise the US. Over on another wall, hangs a painting of Mount Fuji, by Tamako Kataoka, who is known for drawing the Japanese icon.

"The art you see is very personal. Roy told us to pick the pieces that we wanted, and he would design the apartment around them," says Mr Lu. Perhaps because the apartment is still fairly new, it looks more like a luxurious hotel suite than a home, but there are little details that prove otherwise. Mr Lu's "Tree of Life" ornaments dot the shelves around the apartment, while his collection of watches is on display in the study. Then there is his pride and joy - a pair of Steinway speakers in the living room. The avid audiophile enjoys listening to classical music and jazz.

"Not so much pop, but I like the occasional Jason Mraz," he says. His two other homes also have quality audio systems, and he adds that he no longer needs to go to concerts. "I always carry my music with me" says Mr Lu. "At the end of the day, I can enjoy the music the way I like, something that I cannot do in a hotel room."

Source: Business Times

Now we know why Biosensor is reluctant to issue dividends :D

Sembcorp Industries AGM - 25.04.13

2013-04-24T23:42:00.003-07:00

This is my 1st attendance for the Sembcorp Ind AGM which was held at the 30 Hill Street. As part of my experience, I will try to summarize and recap what has been discussed during the questions and answers section so that fellow investors who missed the AGM can keep up with the update.

I arrived at the place quite early around 30 minutes ahead of the scheduled time. As expected, there were not many people yet in the room so I went to register, grab my annual report and the voting call and picked a good spot to sit down. Not long after, there is an uncle who came and sat in front of me and so we began exchanging talks about the company, even to the extent of comparing Keppel with Sembcorp.

At 11am sharp, Mr. Tang Kin Fei (Group CEO) commenced the AGM by summarising the results for the year 2012. As we began the first resolution, there were many questions raised from the shareholders to the Chairman, CEO and the Board of Directors.

The first question asked was from an ahpek shareholder. He grinned about why the screen was placed at the side and not at the center and that he could not see properly after being directed to sit in the middle. He also gave feedback about how Capitalmallasia (CMA) gave a better handout than Sembcorp. Finally, he asked why price for Sembcorp has been trading sideways in recent months and whether it is due to the miserable dividends they gave out (i.e 15 cents/share). All the Chairman and CEO did was to nod their head in agreement. A very light start as usual!!!

Then some serious questions began when the uncle beside me started asking regarding the competitiveness of the energy market and how it will dampen the profits margin for Sembcorp in the future. The Chairman responded by saying that they have been in the business for many years. Any energy prices that are set are not in relation to what the other competitors are setting. The supply and demand are what that determines the price but nevertheless they are confident that the energy market will stay strong in the next couple of years.

The next question was from another shareholder who asked regarding the intangible asset which has either been depreciated or amortised. The question was not exactly very clear to the Chairman but all he responded was that they are in accordance to amortising it in respect with the FRS guidelines.

Next it was my turn to ask. My first question was pertaining to the increase in the impairment losses for trade receivables on Notes 9 of the Financial Statement. The group CFO took over to respond to this by saying that the increase was marginal given the corresponding increase to its revenue so nothing much to worry about. He gave the assurance to the shareholder that risk management is taken care of. I wasn't too impressed with the answer given as it increases quite a bit in my opinion from S$19m in 2011 to S$26m in 2012. Nevertheless, I didn't pursue it any further.

My second question was relating to the dividend payout policy (~35%) which if compared to fellow conglomerates like Keppel (~40% payout) or ST Eng (~90% payout), is a little on the low side. I asked the Chairman if they would consider increasing the payout ratio at some time in the future when its utilities business hit a maturity stage eventually. The Chairman responded by saying that such comparison should not be made, even with the likes of Keppel as Sembcorp is operating at a much different business nature than the others. For now, what Sembcorp will do with the earnings is to use them to grow their utilities business aggresively, like the utilities in Oman and a few other projects scheduled for completions at the end of 2013. This is done to ensure that the utilities business will earn higher recurring income which will then provide greater shareholders' return.

My final question was pertaining to the overall business directions for Sembcorp in the future. I asked that since its utilities business has now grown to a stage where it is able to generate sufficient and sustainable cashflow on its own to pay dividends to its shareholders, would they consider either reducing their stake in the marine business (like what Keppel Corp did with its K-Reits through dividend-in-specie) or would they consider spinning off its utilities business as a trust separately in the future. The Chairman responded by saying that the company will spin off its utilities business as a trust eventually but not sure when. It could be in a matter of 5 to 7 years or longer. As for reducing its stake in the marine business, it has no plans currently at the moment.

A few other questions were raised by other shareholders before we proceed with the rest of the resolutions. After we finish, we proceed out to grab our lunch box :). It was around 12.45 by then and everyone were feeling hungry. I took the lunch box and went sweet home after that.

I own 2 lots of Sembcorp as of this writing.

P.s: I can't help but think that Uncle CW is there too. Uncle CW, were you there?

ST Engineering AGM - 24.04.2013

2013-04-24T01:54:00.004-07:00

This is my 2nd consecutive year attending the ST Engineering AGM as a shareholder. This year, it was held at the Amara hotel which I thought was quite uncomfortable and not spacious enough as compared to last year which was held at One Marina Boulevard.

Shareholders or appointed proxies who attended this year's AGM were given a S$15 NTUC voucher, which I think is a whole lot better than a lunch buffet. Anyway, tea and coffee beverages were available to the shareholders and one uncle actually asked me where I get my sugar!!! :D

Anyway, the Chairman (Mr. Peter Seah) started off the speech by thanking the crowd for coming and making his intention to step down as Chairman with effect on 25 April 2013. He thanked the shareholder for the support he has received as Chairman of ST Engineering and wish the shareholder to keep faith in ST Engineering in the years to come.

When it was time to pass the 1st resolution which was the audited financial statement related, a few questions came up from the crowd. One of the questions was relating to the impairment losses for bad debt in Notes 22 of the Audited Annual Report. Based on the report, allowance for bad debt increases year on year and this raises a concern for the aforementioned shareholder. Mr. Tan Pheng Hock (President and CEO) responded to this query by stating a fraud case in one of their business which resulted in the increase in the impairment losses for 2012. Mr. Tan also assured shareholders that this is a one off case and careful risk management is taken to ensure shareholders' return.

Another question came up (which I have suspected) from another shareholder regarding the purchase of Neratel. The question was why did ST Eng not pursue Neratel further after the initial offer which was rejected. Being both ST Eng and Neratel shareholder myself, this certainly interests me. Mr. Tan responded to his query by saying that every business has a value and if the business does not meet the company's criteria, they would simply walk away. Mr. Tan added by saying that they were previously very interested in one of Neratel's business segment which would help their infocomm business but given the price they are now, they are overvalued and the company would not pursue the acquisition any further. Mr. Tan ended by saying that any acquisitions ST Eng made needs to meet the company's criteria. Otherwise, they will simply walk away from it.

The rest of the questions were revolving around the order backlog, community involvement and others which I thought was ordinary and nothing special to take note of. I was actually quite surprised no one actually inquire about the huge drop in ST Eng price this morning, which has rebounded since. It almost gave me a personal shock.

I am vested with 1 lot of ST Engineering as of this writing.

My Portfolio

Disclaimer: The above writing was based on my personal experience attending the AGM and interpretations and it may differ depending on how others interpret.

Are you having investment savings fatigue?

2013-04-19T06:42:00.001-07:00

Savings is a form of accumulation of wealth.

This is especially true when you are in the stage of accumulation. The higher your savings rate are, the higher your ability to put those funds into investment and get higher returns thereafter.

I've had a fairly solid savings rate since I started my investment portfolio in 2010. Since then, I have utilised them resourcefully to build up my arsenal of solid dividend payers. These include shares in Reits which give a consistent cashflow to my portfolio as well as similar dividend blue-chip grandmaster like Singtel, SPH, ST Eng and SIA Eng which give very decent yields. As my portfolio has grown over the last couple of years, I noticed the result is becoming more and more dependent upon the performance of the stock market. If the market does well, my portfolio would grow at a faster rate and if the market turns bearish, the opposite would occur. Over time, it will grow to a point where it will depend much lesser on the elements that are within my control. So how do folks keep up with the motivation of maintaining their savings habit then?

I spoke to a few seasoned investors who are using a different metric to gauge their performance over time. Based on their response, it seems that they are not keeping track too much of their capital gains or losses. To them, unrealised gains or losses mean nothing to them, as long as the company fundamentals remain strong and dividends continue growing - that's what they are more interested in. When they invest their savings of $10k, they are seeing S$500 of extra income annually or S$40/month. This is where they get their motivation in savings. It is always going to earn them extra income annually.

How do you keep up with your investment savings habit? How do you deal with investment savings fatique?

You're most welcome to share.

A Story of two hypothetical Starhub Investors

2013-04-15T06:14:00.002-07:00

John and Sam are twin brothers who had the same habit of savings when they were young.

Both of them had always been interested in investing and so they looked around the stock market and they tried to purchase a stock that has the greatest probability of producing the highest underlying profits, without any major sell off risk 10-20 years from now.

The two brothers decided to purchase Starhub at different times of the year in 2008. John gets the lowest price possible while Sam gets the highest price possible during the year. John bought Starhub on 8 Dec 2008 at S$1.76/lot while Sam bought Starhub on 14 Apr 2008 at S$3.10/lot.

John invested S$100,000 of his life savings and managed to purchase 57 lots (rounded to the nearest) of Starhub while Sam who invested the same amount managed to get 33 lots (rounded to the nearest). Over the subsequent years, they managed to reap the benefit of dividend investing and both brothers managed to receive the steady dividend returns from Starhub.

Fast forward to 15 April 2013, John who managed to purchase the stock at the lower price, managed to receive S$48,450 worth of dividends and a capital gain of S$151,050. Sam, on the other hand, managed to receive S$33,000 worth of dividends and a capital gain of S$43,230.

The only reason why John collected S$15,450 worth of extra cash dividends and extra capital gain of S$107,820 is because he paid the stock at S$1.76/lot while Sam paid more at S$3.10/lot. John is able to use the extra receipts of these income to buy gifts, spend on vacations or simply reinvesting the dividends into his portfolio. The longer the time period that passed, and the better the business did, the larger this differential became in absolute dollars.

Note that the two brothers owned the exact same business, the same rights, the same management and the same brand. The only difference is that each paid a different price for their ownership stake.

With markets fairly priced in now, ask yourself... Would you rather be John or Sam?

How much money is enough?

2013-04-13T05:40:00.003-07:00

How much money is enough, and what will I do with myself when I get there?

This question is just as challenging for multimillionaires as it is for dollar-a-day farmers. The dilemma is tantalizingly similar for both.

For the one-acre farmer whose family now has enough to eat for the whole year because they have increased their income to three dollars a day, the question is what's next? Do they keep increasing their income from farming, or focus on educating their kids, stabilizing their income, and living a happy rural life?

For the multimillionaire, the question is what's next?

Do they keep making deals and growing their income just like they have been, or take advantage of their economic freedom to make a passionate commitment to write a great novel, make the world a better place, or pursue some other dream?

Small farmers who live on less than a dollar a day often have surprisingly big dreams. A one-acre farmer in Himachal Pradesh, India had just gone deeply into hock to build a small greenhouse where he had started growing carnations and roses for the Delhi market. His eyes widened as we talked about what he could do with low cost drip irrigation. After we finished our tea, he asked for my card. Eight months later, he sent me an email from his newly acquired Apple computer connected to the internet. He told me his business was growing fast, and he would continue growing it.

When you start out below the survival line, enough money means access to food, shelter, and clothing. But how far should poor people go beyond that? How much is enough?

At the other end of the spectrum, Bill Gates and Warren Buffett, with $53 billion and $47 billion respectively, have decided to give their money away. Why give it away? Because it gives meaning to their lives, and because the marginal value of wealth beyond a certain amount becomes trivial.

I have several friends who have accumulated millions of dollars from a variety of enterprises, and I ask each of them the same thing.

"What's your number?"

"What do you mean? They ask.

"Your number is the amount of money you and your family needs to live comfortably." For example, if you need $100,000 a year, and expect to earn 5 percent each year on your assets, your number is $2 million. Once you've reached your number, you can start doing whatever you've always dreamt of doing all your life."

"What is it that you've always dreamt of doing?"

This is where it gets to the hard part. They may very well say

"That's interesting. But I like doing deals, so I think I'll keep doing it"

"That's fine" I say, but some people dream all their life that if they don't need to be a working stiff any more, they dream of writing the next great novel, or becoming a professional scuba diver, or a minister, or a philanthropist, or an actress. What's your dream?"

That's when we get into a really interesting discussion. Because a deep exploration about living the next dream often turns out to be the most challenging, upsetting and happily transformative things they have ever done.

What if you dream of writing the next great novel, and once you have time to do it you find you really can't write worth a lick? Sadly, a great many just pass on the creative struggle of learning about their deeper gifts and dreams, and just keep on doing what they've been doing all along without thinking about it too much.

I have no doubt that the greatest peace and satisfaction comes to people who become passionately committed to something.

Warren Buffett's passion and commitment is to continue making money to hand over to Bill Gates, whose passion and commitment is to make the world a better place through the Gates Foundation. Mark Zuckerberg, the founder of Facebook, announced in 2010 that he will donate $100 million toward improving public schools in Newark, New Jersey.

What's your passion and commitment for the years you have left?

Source:huffington post

"Apr 13" - SG Transactions & Portfolio Update"

2013-04-10T06:22:00.003-07:00

Counters	No. of Lots	Average Price (SGD)	Total Value (SGD) based on average price	Market Price (SGD)	Total Value (SGD) based on market price	Total Dividends collected (SGD) since purchase
FraserCenter Point Trust	12	1.69	20,280.00	2.15	25,800.00	1,185.00
SPH	4	4.09	16,360.00	4.65	18,600.00	0.00
SIA Engineering	3	4.12	12,360.00	4.87	14,610.00	210.00
First Reit	11	0.89	9,840.00	1.29	14,190.00	519.00
Neratel	20	0.46	9,200.00	0.665	13,300.00	400.00
Ascott Reit	8	1.29	10,320.00	1.415	11,320.00	386.00
SembCorp Ind	2	5.44	10,880.00	5.03	10,060.00	0.00
Boustead	6	0.92	5,500.00	1.395	8,370.00	140.00
PLife Reit	3	1.85	5,550.00	2.64	7,920.00	556.00
STX OSV	6	1.245	7,470.00	1.225	7,350.00	0.00
Ascendas Hosp. Trust	7	0.89	6,250.00	1.01	7,070.00	63.00
Second Chance	17	0.43	7,210.00	0.415	7,055.00	456.00
CWT	4	1.43	5,730.00	1.52	6,080.00	0.00
ST Engineering	1	2.82	2,820.00	4.35	4,350.00	1,240.00
YZJ	4	0.96	3,830.00	0.95	3,800.00	0.00
Singtel	1	3.09	3,090.00	3.64	3,640.00	316.00
QAF	3	0.71	2,135.00	0.95	2,850.00	20.00
Noble	2	1.12	2,240.00	1.18	2,360.00	0.00
Total SGD			141,065.00		168,725.00	5,491.00

Market has turned soft recently after a strong run-up to the Q1 2013. Having said that, we have seen that whenever market has a small mild correction, it quickly moves back up due to hot money flowing as people are waiting for a correction as an opportunity to enter.

I have added further grounds to STX OSV and YZJ in the month of Apr. Valuations for both stocks are still compelling in my opinion based on the single digit earnings multiple. Even though forward earnings are expected to drop significantly, it is still cheap compared to its fellow peers in the same industry.

This coming weeks is going to be the earnings season. Market is expected to be more volatile than the usual months. I have saved a few bullets for any upcoming opportunity, notably the opportunity in Sembcorp Industries. The stock looks like it will hit $4.7-$4.8 range after it goes ex-dividend shortly.

I have used this opportunity to also liquidate all my US holdings as Dow and S&P hits a record high. Valuations for the stocks in my holdings look rich and it is a good time to take off profits off the table at some point.

What about you? How is your portfolio doing in the month of April?

Why are people interested in SMRT stock?

2013-04-08T06:22:00.001-07:00

SMRT Corporation (S53.SI) used to be a darling among dividend investors due to its resilient earnings, defensive nature and stable dividend payouts. Its last highest trading price was on 5 July 2010 when it hits a high of S$2.31. Since then, it went on a spiral downwards rollercoaster ride to a low of today's closing price at S$1.515.

I've known many retail investors who are interested in this stock. Their main common reasons interestingly are:

1.) SMRT is on a 52-week low. I'm going to pick them up at S$1.60. If it goes down to S$1.50, I'll average down and if it goes to S$1.40, I'll average down again.

2.) The market looks expensive at the moment. The only stock that looks "cheap" to me is SMRT.

3.) SMRT is one company in Singapore which will not go bust anytime. Everyone needs them.

Based on the common reasoning among retail investors, it seems like many are bottom-picking the stock and regards the 52 week high and low as SMRT's valuation.

What do I think of SMRT?

SMRT is currently trading at a PE of 21.48 (more than 1 SD above mean), which is a smug higher than its peers ComfortDelgro at 16.23. The management has recently issued a guidance that it will report its first Q4/FY13 results at a loss, citing higher operational costs and goodwill impairment as its main reasoning. Note that they have not even accounted for higher salary increment, bonus payout and higher CAPEX. Assuming a higher payout ratio of 80% than its usual payout, investors would most likely receive half of last year dividends of 3.5 cents/share, which amounts to ~3% yield. To me, that doesn't sound appealing, not in terms of the dividends nor in terms of valuation.

SMRT at its 2010 high of S$2.31 has a PE of 21.5. At today's closing price of S$1.515, it has a PE of 21.48. I hope investors who are buying into SMRT realise that they are not buying the stock at a cheaper valuation than what it was in 2010. The plunge in the stock price is caused by the drop in its earnings and NOT because the price is now some 80 cents lower.

I have no idea what is the bottom for SMRT. RSI is currently at an oversold position below 30. So we might get a rebound above the trendline at S$1.53, unless of course Mr. Kim or Mr. SARS decide to take action otherwise.

Are you one of those who are interested in SMRT stocks??

You're most welcome to share your opinions...

Time will differentiate us over time

2013-04-05T19:59:00.003-07:00

Time is our lives' greatest non-equalizer and it brings multiple differences in our lives over a period.

The days when you and I were born, we started at almost the same point in life. We eat, play and go to school at the same courtesy of what we were supposed to do. There isn't much to differentiate to begin with, though I knew a few mothers who have started comparing grades of their own children right ever since they entered school.

10s...

Then to the 20s...People starting to enter colleges, polytechnics or universities, took different degrees and enter a path of their own future destination. The differences started to show early, where students who studied medical school or law school are deemed to have a much brighter future. Some students were scholars and their future are pretty much "guaranteed" stable than students who were having average grades.

20s...

Then to the 30s...It becomes apparent at this point who were making more money than the others. You may find your colleague at high school who used to be at the same point in your life now being a manager or director while you may not reach that point just yet. He may have a nice car, a great bungalow and living in a world of abundance while you are struggling to pay for your rent. It was clear by now who is wealthy and who is not.

30s...

Then to the 40s...differences in the health maintenance began to show. Some started to look old and sick while some still look as energetic as they were in their 20s. Those whose health were deteriorating were contemplating to retire from the corporate world but found it hard as he still has to pay for the expenses of the chidlren and family.

40s...

Then to the 50s...It was time to prepare for retirement. People who have done financial planning early in their lives will reap the benefits of retiring early at this point in their lives, enjoying life with family while some who are still drowned in the world of debts will probably still be working at this point in your life. It was very apparent at this time who will finish strongly in the race and who is lagging behind.

50s...

................

What about those who are in their 60s, 70s, 80s and beyond?

Immigrants get creative to survive without credit

2013-04-05T07:54:00.003-07:00

America runs on credit. We take out loans to buy expensive items like cars or houses. We borrow for little stuff using credit cards. And our credit history determines our ability to simply rent an apartment.

We often take credit for granted. You know who doesn’t? Immigrants. Especially undocumented immigrants living in the shadows. Without access to credit, undocumented immigrants are forced to get creative, even entrepreneurial.

In Alhambra, Calif., just east of Los Angeles, Mario Escobar, 35, juggles multiple jobs. With his two young daughters in tow, he comes to the post office every other day to mail books.

“This one is going to Lowell, Md. And this one is going to Milwaukee,” Escobar tells the postal clerk, handing him two packages. Escobar runs a small business publishing other people’s books. Today he’s sending off copies of his own novel.

“It’s about the civil war in El Salvador. And the experience of migrating and carrying the personal traumas and how do you deal with it,” says Escobar.

Before he’s left the post office, Escobar gets a phone message related to his other job -- translating. He has two weeks to translate the work of an associate who has a potential book deal with Random House.

Escobar’s dexterity can be traced back to his experience as a student at UCLA.

“When I was an undergrad, I didn’t qualify for loans,” he says.

This was back before he was approved for political asylum, when he was still an undocumented immigrant.

“My grandpa used to say, ‘When people are hungry, they get creative,’” Escobar says.

Escobar was a starving student, but due to his undocumented immigration status, no bank would give him a loan. That forced him to get very creative.

“It went from being a janitor to cutting grass to tutoring,” Escobar says. “I was writing papers for people. People will say, ‘Wait a minute. Did you do that?’ Well, you know what? Unfortunately, we also had our own corner of Home Depot in academia. People didn’t want to write their papers. I needed money.”

His experiences mirror those of other immigrants, like 25-year-old Jose Luis Zelaya.

“It’s been a very difficult journey,” says Zelaya. “Being homeless in Honduras and not being able to survive in my home country. Seeing my brother pass away because we didn’t have money to take him to the hospital.”

Living on the streets of Honduras, Zelaya saw an old woman doing crochet. He asked her to teach him. But she refused, telling him that it’s "woman’s work." Undeterred, he taught himself to crochet.
Zelaya kept at it even after he moved to Houston when he was 14.

“I had a crazy idea that I wanted to go to college, but I was faced with the obstacle of not being able to work, and being too afraid to work with fake documentation," says Zelaya. "I have never had a loan from a bank. I was not able to apply due to my immigration status. So I relied on crocheting and I started making a lot of beanies and scarves and headbands." Zelaya sold his crochet beanies at flea markets.

Now he’s a grad student at Texas A&M.

And even though he’s been given a legal work permit through the Deferred Action program, he still sells his crochet online. “It made life a bit more difficult, not being able to pay for school through loans. Or not being able to apply for a credit card," says Zelaya. "Through crocheting, I have been able to pay for my books. It has also paid for my rent. It has paid for my food. But it has also paid for my sister’s tuition, and all of her books.”

In Los Angeles, Miguel Carvente paid for his education at UCLA by holding raffles and throwing parties with a cover charge. At the time, he was jealous of friends who got student loans. But now they owe as much as $60,000.

“Now I find myself in the very privileged position of having very close to a Master’s degree and have zero debt,” says Carvente.

Others get around the lack of formal credit by participating in savings clubs. In Mexico, it’s known as a "tanda." In El Salvador, it’s called a "cundina." Either way, it’s the same idea. A group of people agree to contribute a certain amount of money to the collective pool every month. And over the course of a year, they take turns taking home that pool of cash.

Mario Escobar remembers his uncle buying a new pick-up truck for his gardening business. His uncle paid $8,000. Escobar asked if he paid with credit. His uncle replied, “No, no, no. I paid in full. Now I only need to repay my friends in the ‘cundina.’”

Sometimes, undocumented immigrants get around restrictions on credit through, shall we say, "creative financing."

“I simply want to take it back to the old-school. You have what you earn. And that’s it,” says Escobar.

He doesn’t believe in credit. Or handouts. He even says he’s proud to pay taxes.
“I personally do not believe in the welfare system,” says Escobar.

Welfare for him is similar to credit; he says they both drain a person of creativity. Escobar sees the need to pay the rent as a chance to kick-start inspiration.

Source: http://www.marketplace.org/topics/life/immigrants-get-creative-survive-without-credit

What are some of the things you would miss should you achieve financial independence and stop working FT one day?

2013-03-28T22:41:00.001-07:00

Don't get me wrong. Much as I would love to be financial independent right now, I am nowhere near the target at the moment. It would be at least another 8 years to financial independence. So for those who have achieved financial independence, what are some of the things you would miss about working full-time?

The following are some of the things I would miss once I stopped working full-time:

1.) Social Interaction - A huge part of the my working lifestyle and as far as I can remember, it is probably one of the most valuable thing I have an impression of, even as I left the company.

2.) Teamwork - Being part of the productive team, strong bonds that come with working with different people with different backgrounds. When there are issues or problems, we struggle and think together as a team.

3.) Access to credit - We generate active income as we work and that means that we can get access to loans and credits for the purpose of buying a property or applying for a credit card (not encouraged).

4.) Printing - I am not trying to sound cheapskate but I admit that I do not have a printing machine at home as I find that printer is one infuriating and expensive device. As such, I print most of my stuff at work, even if some are personal related emails.

5.) Getting paid on weekends/public holidays/medical/annual leave - Working employees generally tend to enjoy plenty of medical leave / annual leave / public holiday and they are paid for these leave entitlement. Even as I was having one of my unproductive days by sitting at my desk staring at the monitor, I was glad that my pay was not deducted.

6.) Health Insurance - My company's term insurance includes outpatient and specialist leave which has been very cost effective for me these few years.

So what do you miss from your working life should you "retire" from the corporate world and achieve financial independence one day?

Ready to dump REITS?

2013-03-28T20:03:00.002-07:00

For anyone who has not read the post written by FFN recently, I would recommend you to go to his site to read on his recent post on the possible bubble on REITS (Link here). I think he provides a great insight and an interesting perspective that all of us as a REITS investor can take away something from.

As we have ended the 1st Quarter of 2013, let us take a look at how REITS have performed relative to their 2012 closing price.

Rank – Capital Gains

REIT	Mar-13	Dec-12	Gain
First REIT	$1.250	$1.060	17.9%
PLife REIT	$2.530	$2.150	17.7%
Cambridge	$0.790	$0.675	17.0%
FE-Htrust	$1.175	$1.005	16.9%
StarHill	$0.890	$0.785	13.4%
MGCT	$1.040	$0.930	11.8%
Sabana REIT	$1.265	$1.140	11.0%
MCT	$1.345	$1.215	10.7%
Ascendasreit	$2.600	$2.370	9.7%
A-Htrust	$1.030	$0.940	9.6%
CDL Htrust	$2.050	$1.880	9.0%
Fortune Reit HK$	$6.860	$6.370	7.7%
SuntecReit	$1.800	$1.675	7.5%
FrasersCT	$2.140	$2.000	7.0%
FCOT	$1.410	$1.320	6.8%
CapitaRChina	$1.750	$1.645	6.4%
MapletreeLog	$1.215	$1.145	6.1%
AIMSAMPIReit	$1.575	$1.495	5.4%
CLT	$1.305	$1.240	5.2%
LippoMapleT	$0.515	$0.490	5.1%
K-REIT	$1.360	$1.295	5.0%
SaizenREIT	$0.190	$0.181	5.0%
MIT	$1.405	$1.360	3.3%
AscottREIT	$1.380	$1.360	1.5%
CapitaMall	$ 2.09	$ 2.13	-1.9%
CapitaComm	$1.585	$1.685	-5.9%

Source: SGX Reit Data

Not surprisingly, REITS have once again taken the spotlight and outperform the STI index for the 1st Quarter of 2013. Yields for some of the best performing REITS like PLife Reit and First Reit have further compressed to 4.1% and 5.7% respectively. We also have many other REITS yielding 4+% and 5+% which may suggest further capital appreciation is limited. A good example would perhaps be retail REITS - CapMall Trust which is currently yielding 4.4%. The price is trading at a range for a good recent few weeks and the low volume buyer on CMT may suggest exhaustion on this particular REIT.

Personally for me, I am ready to take profits on PLife Reits and FCT. It has risen by some 36% and 27% (excluding dividends) since I last bought them. The probability for the downside to its price is probably much higher than the upside. Also, I don't foresee FCT injecting Changi City Point in its portfolio in 2013 based on its past records and a more likelihood will come in 2014. Until then, we'll never know what kind of "Cyprus incident" there may be out there.

There are currently many investors out there who are asking for advice and waiting for a pullback to enter REITS and they may be somewhat disappointed based on what they see for the 1st Quarter. Based on my past investing experience, the risk has somewhat increased a lot now to enter REITS. With talks from the FED and analysts that the interest rates may somewhat go up in the early 2014, prudent investors may want to take note of the risks they are getting into should you decide to enter REITS today.

Everyone is a genius - A. Einstein

2013-03-26T07:19:00.002-07:00

Albert Einstein once said: "Everyone is a genius. But if you judge a fish by its ability to climb a tree, it will live its whole life believing that it is stupid."

Unfortunately, we are being tested and selected everyday in an unfair cruel selection methodology in our society. Some of us, who may be potentially good entrepreneurs, found ourselves working for others in a 9 to 5 job just to stay competitive in this society. And I've seen too many of those - Potential winners becoming amateur just because they don't "fit" the system.

I myself am guilty of this at times. Am I a monkey who is ready to climb the tree or a fish who is ready to swim across the ocean. Maybe that is the reason why there are so many people who feel that life is meaningful and stupid!! These people haven't found or utilise their ability... just yet.

Is getting rich all but worth it?

2013-03-24T00:58:00.001-07:00

One anonymous user answered this one million dollar question recently on Quora which I thought was interesting and would like to share with the other readers.

I made $15m in my mid-20s after I sold a tech startup. I talked to a lot of people about this question, and thought a lot about how to stay the same person I was before and after making money.

Here's my answer: being rich is better than not being rich, but it's not nearly as good as you imagine it is.

The answer why is a bit more complicated.

First, one of the only real things being rich gives you is that you don't have to worry about money as much anymore. There will still be some expenses that you cannot afford (and you will wish you could), but most expenses can be made without thinking about what it costs. This is definitely better, without a doubt.

Being rich does come with some downsides, though. The first thing you are thinking reading that, is, "cry me a river". That is one of the downsides. You are not allowed to complain about anything, ever. Since most people imagine being rich as nirvana, you are no longer allowed to have any human needs or frustrations in the public eye. Yet, you are still a human being, but most people don't treat you like one.

There's the second downside. Most people now want something out of you, and it can be harder to figure out whether someone is being nice to you because they like you, or they are being nice to you because of your money. If you aren't married yet, good luck trying to figure out (and/or always having self doubt) about whether a partner is into you or your money.

Then you have friends & family. Hopefully your relationship with them doesn't sour, but it can get harder. Both can get really weird about it and start to treat you differently. They might come and ask for a loan (bad idea: if you give, always give a gift). One common problem is that they don't appreciate Christmas presents the way that they used to, and they can get unrealistic expectations for how large a present should be and be disappointed when you don't meet their unrealistic expectations. You have to start making decisions for your parents on what does and does not cost too much, and frankly, it's awkward.

Add all of these up and you can start to feel a certain sense of isolation.

You sometimes lay awake at night, wondering if you made the right investment decisions, whether it might all go away. You know that feeling standing on a tall building, the feeling you might lose your mind and jump? Sometimes you're worried that you might lose your mind and spend it all.

The next thing you need to understand about money is this: all of the things you picture buying, they are only worthwhile to you because you cannot afford them (or have to work really hard to acquire them). Maybe you have your eye on a new Audi -- once you can easily afford it, it just doesn't mean as much to you anymore.

Everything is relative, and you are more or less powerless to that. Yes, the first month you drive the Audi, or eat in a fancy restaurant, you really enjoy it. But then you sort of get used to it. And then you are looking towards the next thing, the next level up. And the problem is that you have reset your expectations, and everything below that level doesn't get you quite as excited anymore.

This happens to everyone. Good people can maintain perspective, actively fight it, and stay grounded. Worse people complain about it and commit general acts of douchebaggery. But remember this: it would happen to you, too, even though you might not think so. You'll just have to trust me on this one.

Most people hold the illusion that if only they had more money, their life would be better and they would be happier. Then they get rich, and that doesn't happen, and it can throw them into a serious life crisis.

If you're part of the middle class, you have just as many opportunities to do with your life what you want of it. If you're not happy now, you won't be happy because of money.

Whether you're rich or not, make your life what you want it to be, and don't use money as an excuse. Go out there, get involved, be active, pursue your passion, and make a difference.

How much loyalty should you owe to your company?

2013-03-21T06:34:00.001-07:00

Loyalty is respect.

Back in the days where mobility and transition are remote, loyalty is seen as one most important aspect of an employee's characteristic. Fast forward to 20th century, do we still see the same loyalty in an employee? How much loyalty do employees owe or have to their employers?

From an employer's point of view, they want staff who they can nurture and stay with the company through thick and thin. This means that they will spend resources after resources and efforts after efforts to train the employee so that he/she can one day become the leader of the organization and contribute to the ultimate long term goal of the company. Training sessions, team buildings and seminars are one of the few schedules employers send their employee to because they want to nurture them long term. Based on one source, if an employer hires a staff and he/she resigns after 2 years, the employer would have to start again from scratch, costing almost 150% of the resources which they could invest in somewhere.

However, most of us are after all an employee, at least that's what I am right now. Departing employees often feel a deep sense of loyalty to the company and I've seen it enough to know that the feeling is common and genuine. This can be a troubling dilemma for you as one hand you want to pledge your loyalty to your employer but yet on the other hand you want to pursue your dreams elsewhere.

Now, let me tell you about the ultimate truth regarding relationship between an employee and employer:

"Beyond a hard day’s work in exchange for a paycheck, an employee owes NOTHING to a company"

Whether you like it or not, the truth is you are only important to the company as long as you contribute something to the company. A company's responsibility is to drive up profit margins and increase shareholders value so irregardless of the tenure you have served in the company, once the company sees you as useless, the agreement will not be mutual and they will terminate your service.

Robert Green once said: "Your loyalty is not to a career or to a company but to your life's task - to giving it full expression".

You can love your colleagues, bosses or even your work, but you should never have any affection to your company. If you end up one day on the other side of the fence as an employer, always remember that your employees don't owe you anything more than a hard days work.

Do you like your working environment?

2013-03-19T07:56:00.001-07:00

Employees are an important assets to the company. It is their overall productivity that determines the bottom line of the company. One way to increase productivity is to give them a happy environment at work. I am not talking in terms of monetary terms about increaseing their bonuses but instead the power of environment. Ever wonder why your office always look so squarish? Does good looking workplace increases employee retention? That's definitely one thing the HR can consider.

Google Singapore office

Facebook Singapore office

Now where did I save my resume?

"Mar 13" - SG & US Transactions & Portfolio Update"

2013-03-15T05:32:00.002-07:00

Counters	No. of Lots	Average Price (SGD)	Total Value (SGD) based on average price	Market Price (SGD)	Total Value (SGD) based on market price	Total Dividends collected (SGD) since purchase
FraserCenter Point Trust	12	1.69	20,280.00	2.13	25,560.00	1,185.00
SPH	4	4.09	16,360.00	4.52	18,080.00	0.00
SIA Engineering	3	4.12	12,360.00	4.75	14,250.00	210.00
Neratel	20	0.46	9,200.00	0.68	13,600.00	400.00
First Reit	11	0.89	9,840.00	1.20	13,200.00	519.00
SembCorp Ind	2	5.44	10,880.00	5.14	10,280.00	0.00
Ascott Reit	8	1.29	10,320.00	1.35	10,800.00	386.00
Boustead	6	0.92	5,500.00	1.40	8,400.00	140.00
PLife Reit	3	1.85	5,550.00	2.38	7,140.00	556.00
Second Chance	17	0.43	7,210.00	0.415	7,055.00	456.00
Ascendas Hosp. Trust	7	0.89	6,250.00	1.06	7,420.00	63.00
CWT	4	1.43	5,730.00	1.455	5,820.00	0.00
STX OSV	4	1.250	5,010.00	1.265	5,060.00	0.00
ST Engineering	1	2.82	2,820.00	4.21	4,210.00	1,240.00
Singtel	1	3.09	3,090.00	3.58	3,580.00	316.00
QAF	3	0.71	2,135.00	0.93	2,790.00	20.00
Noble	2	1.12	2,240.00	1.19	2,380.00	0.00
YZJ	2	0.96	1,920.00	0.95	1,900.00	0.00
Total SGD			136,695.00		161,525.00	5,491.00

The big highlight for the month of Mar is the potential spinoff of the SPH property portfolio into a REITS. The stock jumps almost 10% (based on latest closing price) since before the announcement was made. Looks like I managed to get into SPH just at the right time. If the stock continues to go up further, I might just... just be tempted to take profits on SPH, for all the various reasons.

I've added 3 new entries into my portfolio for the month of Mar. I have rotated out of FCT and Neratel once again as the price rises and I've added CWT, STX OSV and Yangzijiang based on the low valuations these stocks are in. CWT is a logistic and commodities company which I see deep value in. Its commodities business segment in particular is only in a baby stage growth and it will grow to much much more than what it is valued today. This is definitely a growth play. It will pay dividends of $0.03 a share in May.

It has been a very busy month for STX OSV (Vard) as investors await for the offer which lapsed this week and the Fincateri Italian company only gained some 4% thereafter. This is another company which has great value and current price is compellingly undervalued.

I have a total of 18 stocks in my portfolio.

Counters	No. of Shares	Average Price (USD)	Total Value (USD) based on average price	Market Price (USD)	Total Value (USD) based on market price	Total Dividends collected (USD) since purchase
Verizon (VZ)	20	43.22	864.40	48.48	969.60	0.00
AT&T (T)	20	34.43	688.60	36.86	732.20	0.00
Coca-Cola (KO)	5	37.07	185.35	39.02	195.10	0.00
Lorrilard (LO)	5	38.57	192.85	39.66	198.30	0.00
Merck & Co (MRK)	2	41.00	82.00	44.27	88.54	0.00
Total USD			1,820.35		2,183.74	0.00

I have added Lorrilard (LO) in my US portfolio for the month of Mar.

Lorrilard is the 3rd largest US tobacco company and one of the leading manufacturer of menthol cigarettes. It is currently trading at a PE of 12.7, which is much lower than its main competitor, Philip Morris (PM). Given its competitive earnings and a higher growth menthol market, the stock has a fair value of around US$44 based on a DDM model. The stock is currently yielding 5.70% and is one of the more attractive stock out there in the market.