3 Potential munchies over the next few months

For those of you who have been following my blog, you would probably know that my current portfolio is heavily concentrated on the healthcare sector. And I had previously planned to keep the proportion of healthcare counters to about 50% of my portfolio. However, with my latest purchase of shares in ISEC healthcare which i blogged about here, healthcare sits at a significant 70% (approximately) of my portfolio. 

I am planning to balance my portfolio and I am currently, and will continue looking at counters from other sectors. Please note that whilst I believe balancing my portfolio is necessary, I will not do so unless I find suitable shares at prices I can swallow.

Here are some counters I am looking at;

Singapore Telecommunications (Z74)

If you had read my portfolio page, you would have realised that I do have a small parcel of Singtel shares already, and if you are interested, I blogged about it here recently. Potentially, I am looking at doubling my holdings in this counter, and my reasons for investing in it remains unchanged from what I previously mentioned. But in short, I believe Singtel remains an excellent defensive play due to its' significant diversification, good management track record, and little free-float. 

Frasers Logistics and Industrial Trust (BUOU)

(image credits: Frasers Logistics Trust)

I have never bought an industrial REIT before, and this is the first one on my watchlist. They have recently exceeded their maiden DPU forecast, and currently sits at approximately 99% portfolio occupancy. They also boast a WALE of about 7.0 years. This is higher than most other industrial REITs listed in Singapore. For those of you who are new to the term, WALE (Weighted Average Lease Expiry) essentially reflects how long the average remaining lease period is, to a tenant of the REIT. This is done by taking into account every tenant's respective contribution to the REIT and their remaining lease period, and aggregating the amount. In short, the greater the WALE, the less risk the REIT faces as tenants aren't going to vacate anytime soon.

The REIT also has sufficient room to acquire more properties, and they have recently made a good acquisition (The Martin Brower Property), which increased their WALE and reduced their average portfolio age.

I also like the fact that the REIT's properties are based in Australia, and collects rent in AUD. Although there is no risk of unfavourable/favourable currency swings at the moment due to hedging, in the next FY (FY18), it may not be the case. I am bullish on the Australian dollar, and its economy, and I believe that its' currency will continue to be on the upswing, which could potentially increase distributions in this REIT. We should also note that Australia has not experienced a single recession in the past 25 years. 

This counter is not that expensive yet, and is currently hovering right between the 52 week low and high. Hence, I am monitoring this counter closely for an opportunity to invest.

ISOTeam

This is probably the least well known counter out of the three. This company specialises in facilities management and upgrading of the public housing estate in Singapore. Sounds defensive already doesn't it? Services they provide range from painting services, pest services to re-roofing and waterproofing. At the same time they do have a number of subsidiary companies which I will not be writing about here as it is not the main point. The problem though is that this may have already been factored into the share price, as you can see in the chart below and it is decently expensive, if not the most expensive for a counter classified under the construction sector: 

(image credits: yahoo finance)

I will probably be just monitoring ISOTeam for now due and will only strike if there's a window of opportunity.

On this note, that will be all from me today, and I'd like to thank you for your support!

Best Regards,
A 😁

Spending Habits

(image credits: clipartfest.com)

I pondered about this as i bought my cup of KOI tea (for those of you who are unfamiliar with this, it is a chain of shops which sells "premium" bubble tea, aka tea with tapioca balls) as per usual today.

I have been drinking a cup of KOI tea nearly every day since they opened their stores on our sunny island. Thinking back, instead of "wow, I loved every cup of KOI tea", my first thought was "wow, I wasted a lot of money". I do know of others who also has bad spending habits, be it a daily cup of overpriced tea or dining daily at expensive restaurants, and I believe this is very common in society nowadays.

Let's now move on to the tangible aspects of the discussion, using my case as an example:

A standard cup costs about $3.50

There are 365 days in a year

If someone were to buy a single drink daily, they would have spent: $3.50 x 365 = $1277.50 by the end of the year.

It is really difficult to include in the discussion intangible benefits and to churn out some value buying the drink would confer; e.g. "increase in productivity", "brings about relaxation" which is arguably true as it is after all something people enjoy. Or they wouldn't buy it right? So we would be assuming no intangible benefits at this point in time.

Lets say we invest the $1277.50 spent yearly into a fixed deposit or savings bond with a coupon rate of 1.2% per annum, with the interests reinvested. And lets also assume that the rate remains unchanged (which is unlikely) but its not the point of this discussion.

After 5 [+1: I've included the duration of the final (5th year) whereby the 5th interest would be paid out for the investment on the 1st year] years we would have:

$1277.50 + $12.78 + $12.90 + $13.03 + $13.16 + $13.29

+ $1277.50 + $12.78 + $12.90 + $13.03 + $13.16

+ $1277.50 + $12.78 + $12.90 + $13.03

+ $1277.50 + $12.78 + $12.90

+ $1277.50 + $12.78

= A hefty sum of money which could have been saved 😟

Now the point of this post or discussion isn't to tell you to quit your hobbies, or to stop what you enjoy doing, nor is it telling you to be extremely thrifty, nor to scrimp and save. The point is that we should all reflect back on our spending habits and ask ourselves; "is it all worth it? Is there anything that I should have/wanted to achieve now, but haven't due to these habits? Would I have done it any differently?"

Perhaps from these questions, you and I will be able to get answers eventually, answers which may guide us towards what to do next, and hopefully, it will be ultimately beneficial in contributing to our financial freedom in the future.

Till next time!

Best Regards,

A 😁