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30-04-2013, 09:21 PM
Hi everyone, I have been here for sometime just reading everyone’s postings and I hope that you guys could offer me some advice on what to do with my portfolio. I am retired (victim of the recent car loan curbs) and hence earning no income but I have my wife, 3 children (aged 19, 18 and 16) and my mother to support.
My investment objectives are (in order of preference):
1. to generate an average of $13,000 per month from my investments annually (including property)
2. to achieve a nominal CAGR of 4% over the next 5 years
Right now my current investment portfolio excluding my main residence includes
a) SGX stocks: 2.3 million – Net yield 3.34%
b) SGD Bonds maturing in 2017: 0.5 million – Net yield 4%
c) SGD Cash (excluding emergency fund): 0.8 million – Net yield 1.1%
d) SGD Property: 2 million – Net yield 2%
This gives me a net income of about $11,700 per month which results in a shortfall of about $1,300 which I am trying to find ways to make up.
I know the obvious answer would be to use the cash I am holding to purchase short to medium term bonds (<7 years) yielding about 3-4% or stocks yielding about 4% (e.g. Singtel) but I am wary that the prices of these 2 assets in particular bonds have risen so much that their risk return trade off is no longer attractive. In addition, I was thinking maybe it would be good to maintain the flexibility to take advantage of corrections in the market (<20%)
I’m actually quite clueless about the stock market and my main source of wealth is actually 2 properties I bought a long long time ago…. 1 of which went en bloc last year. My stock portfolio actually resembles the STI. With high weights in DBS, UOB and Singtel… I have made money but I am very aware that I am just lucky.
I also have a $500,000 loan against my main residence which I took out last year fixed at 1.5% interest for 5 years. Currently hedging this off with the bonds maturing in 2017. Would not cost effective to pay off this loan as I am locked in for the 5 years. Also the cost of holding this loan is only 0.4% pa given that I cash at 1.1% with ANZ.
A humble thanks in advance for any advice offered. Would really appreciate any advice and new insights offered.
My investment objectives are (in order of preference):
1. to generate an average of $13,000 per month from my investments annually (including property)
2. to achieve a nominal CAGR of 4% over the next 5 years
Right now my current investment portfolio excluding my main residence includes
a) SGX stocks: 2.3 million – Net yield 3.34%
b) SGD Bonds maturing in 2017: 0.5 million – Net yield 4%
c) SGD Cash (excluding emergency fund): 0.8 million – Net yield 1.1%
d) SGD Property: 2 million – Net yield 2%
This gives me a net income of about $11,700 per month which results in a shortfall of about $1,300 which I am trying to find ways to make up.
I know the obvious answer would be to use the cash I am holding to purchase short to medium term bonds (<7 years) yielding about 3-4% or stocks yielding about 4% (e.g. Singtel) but I am wary that the prices of these 2 assets in particular bonds have risen so much that their risk return trade off is no longer attractive. In addition, I was thinking maybe it would be good to maintain the flexibility to take advantage of corrections in the market (<20%)
I’m actually quite clueless about the stock market and my main source of wealth is actually 2 properties I bought a long long time ago…. 1 of which went en bloc last year. My stock portfolio actually resembles the STI. With high weights in DBS, UOB and Singtel… I have made money but I am very aware that I am just lucky.
I also have a $500,000 loan against my main residence which I took out last year fixed at 1.5% interest for 5 years. Currently hedging this off with the bonds maturing in 2017. Would not cost effective to pay off this loan as I am locked in for the 5 years. Also the cost of holding this loan is only 0.4% pa given that I cash at 1.1% with ANZ.
A humble thanks in advance for any advice offered. Would really appreciate any advice and new insights offered.