Comfort Delgro back to $1.25, heading lower?

 Comfort Delgro reported its 3Q2022 results and it appears that the market didn't like it and the price went down to $1.25. I bought some more at $1.25 as I feel that valuations are undemanding at this level and that fair value is around $1.50. There is of course a risk that it may drop further but I don't think CDG share prices are that volatile. Happy to continue to add more if it drops further.

The damage to CDG's bottom line is not the really the "business" as revenue is slowly recovering, but the increased operating costs,  presumably due to inflationary pressures Nevertheless, CDG remains a company that is actually making a profit (compared to Grab for example) and the free cash flow is decent.

Edit: Straits Times Reported today that from 2024, it will be mandatory for Grab to pay CPF for riders aged 30 years and below, and the object is to get everyone to "operate on a level playing field." The ST seems to imply that making age under 30 mandatory is only a start:

The new CPF policy has also caused some disgruntlement among major platform companies here, who believe the exemption of street-hail taxi drivers from the CPF scheme might give taxi companies an unfair cost advantage.

Grab, particularly, said in a statement that street-hail taxi and third-party logistics companies should also be included as they similarly engage gig workers.

Gig workers in Singapore to get basic protection including insurance and CPF from as early as 2024 | The Straits Times

 

US Midterm Election + inflation-not-so-bad Rally?

US Midterms are over and US CPI for October 'only' increased by 7.7%. Dow is +2.68% while S&P500 is up +4.19% and Nasdaq is up +5.67% as I write this. I suppose S&P500 is more tech heavy versus the Dow. A one day $30k+ gain is helpful and I still hope to breakeven by the end of this year though time is running out...

Fortunately I have done my monthly DCA for November already plus the FSMOne RSP (China markets is not a pretty sight so I am grateful that I have automated my RSP for 3010.HK and 2801.HK). Therefore I am content to just watch the rally. I should be able to resist chasing the rally because I can put my money to work in fixed income. Whereas in a low interest rate environment, there seemed to be no alternative to equities.

Strategy: November 2022

 With S&P500 under 3,800, I will continue to accumulate S&P500 and World ETFs (since US is about 50% world).  For this month I have bought some VHYD and IWDA and will continue to 'top up' the rest of my World ETFs (VWRD, WQDV).

I will leave my FSMOne RSP to run this month, which means I am buying 3010.HK, which is an Asia ETF with about 30%+ China, and a smaller amount of 2801.HK. Definitely a lot of uncertainty with regards to China so regular RSP seems to be the plan.

On the Singapore front, REITs are sort of crashing, the narrative is that there is no reason to accept current REIT yields when you can get risk-free 4% in government securities. Certainly there are those who are happy with 4% so they may want to reduce their equities exposure, however, I am still interested in REITs/stocks that have good fundamentals, especially if their price drops because people are exiting the market to buy bonds.

Earlier I had posted about accumulating Comfort Delgro (went up to $1.32) and Capland Ascott Trust (dropped a bit to $0.95).  Most of my money went to Comfort so I'm ok with the overall price movements.  Another REIT I am interested in is Frasers Centrepoint Trust which went below $2 because I do visit their malls and business still seems ok. I bought some under $2 and will continue to accumulate.

Dividends Collected: Oct 2022

 

A quiet month for dividends.

SSB 3.21% / T-Bill 4.19%

This month I got $10.5k of SSB and a smaller amount of T-Bills. 

This months' SSB and T-Bill application dates coincided. One would have expected demand to for SSB to be less as some of the money would have been diverted to T-Bill applications, but SSB demand remains high and the SSB allocation for this month was $10,500. The SSB 3.21% average rate is very attractive.

In contrast, the interest rate for the preceding month was 2.75% and the allocation was $42,000.

As for T-Bills, the interest rate /cut-off yield hit a record 4.19% which is very nice indeed. It makes me seriously consider using my CPF to bid for T-Bills despite the hassle of needing to join the bank queue as CPF applications for T-Bills must be done 'manually'.

The internet has calculated that in order for T-bills to be more attractive than CPF 2.5%, the yield must be more than 2.96% (to compensate for the loss of CPF interest in the month pay for T-Bills and the month the T-Bill is refunded to your account). Of course, if you roll-over the T-Bill by buying a fresh T-Bill in the same month, this reduces the lost interest.

Dividends Collected: Sep 2022

 

Despite the market downturn and the crash in the pound, I am still getting record dividends for Sep 2022. I notice that other bloggers such as Homer123 and ASSI have reported that they are collecting more dividends as well.

Sep 2022 update and Oct strategy

 

As I am overweight the UK stock market, the GBP crash was bad for my portfolio, but at least I am still ahead of VT.

Valuations are looking attractive. With the 3,600 S&P500 breached (currently its 3585), I'm buying more World ETFs and also buying VUKE and some UK stocks.