As we reach the mid-point for 2020, I took a pause to look back and see how far off I have fared since 6 months ago when I did my Review of 2019 Stock Holdings. It was the first major downturn since I started investing. The first few months were “bad months” due to COVID-19.
One of the lessons I learnt is to move out of related stocks that were deeply affected by the crisis and hold cash while re-entering them at a lower low — counters like hospitality, airlines and REITs dived deeply. This was easier said than done, especially when you were once holding on to stocks which were fundamentally strong. However, one has to plug into reality and its circumstances — less tourists, less customers, less office workers able to return back to office during the lockdown means no travel-related revenue, no sales and defaults or discounts in rental.
However, this crisis represented an awesome opportunity in general — good stocks were out for cheap for bargain hunters. Also, there were stocks inversely gained traction: while people stayed home, online shopping surged, teleconferencing frequency rose and medical supplies or Personal Protection Equipment rose in demand.
Current portfolio value. The portfolio is modestly valued at SGD$54,856.24. The XIRR is at a negative 45.94% for 2020. Appalled results, however our investment horizon is a long-term one, we recognised that there will be ups and downs. The key is to continue investing even in the dumps instead of selling when there is no better use of redeploying the funds. We are keeping a eye on the more attractive counters, as we continue plowing $4000 monthly into our investible funds.
Dividends earned for 2020. For 2020, current annual dividends stand at SGD$845.04 which is fully reinvested. It may be substantially lower with HSBC Holdings (0005.hk) cancelling the fourth interim dividend for 2019 and halting all interim dividends for 2020 till a firmer decision comes in during 4th interim amid the economic uncertainty surrounding the coronavirus pandemic.
Current holdings. As of now, I am 42.8% vested in Banks, 22.4% into REITS, 19.2% into airline and 12.4% into industrial conglomerates. Between SGX and HKEX, about 44-56.
Plans for 2020. Opportunities are still rampant in the international market, though not at the lowest of the low now. However, there is still uncertainty if the worst is over or that a second wave might sweep it back down. Not until a vaccine is discovered and declared a success could be pave a way towards heightened optimism.
I used to get quite emotional and stressed when faced with a major draw-down. This was coming from the angle when I was trading FOREX for a short while in my younger days. However, I continue to maintain a macro view of things — this builds confidence in me that long-term and consistent investing works if you also take into consideration what people can live with or live without when lives go back to normal, hopefully in the near future.
Have you reviewed your mid-year investment performance for 2020?