Sunday, April 10, 2016

March 2016 - Unit Trust Portfolio Update

My unit trust portfolio recovered in March but the return was still in red. YTD return was -0.13% as of March 2016. I received $143.45 in cash distributions.

I'd been wanting to reduce my exposure on high yield bonds after listening to Carl Icahn's videos, so I completely liquidated these 2 high yield bond funds during March recovery:
Legg Mason WA Global HY Fd A SGD H (mdis) plus - $6,251.87
Allianz US High Yield AM Dis H2-SGD - $2,911.43

High yield bonds were issued by companies with credit ratings below investment grade, and therefore offered higher interest. In Icahn's view, diversifying by holding high yield bonds from different companies didn't help reduce risks. He drew the parallel between high yield (junk) bonds and subprime mortgage securities. In the search for yield, the price of the junk bonds had been chased to potentially bubble level. I thought the view made sense, and it paid to be cautious.

I reinvested the proceeds into:
United Asian Bond Fund Class SGD - $7,000
First State Dividend Advantage(SGD) - $1,500

Because of the re-balancing, the ratio of my portfolio became: 40% equity, 10% high yield bonds, 50% bonds.

Link to Yaruzi's unit trust portfolio allocation as of Mar 2016

Tuesday, April 5, 2016

March 2016 - Low Cost Portfolio Update

It was a quiet month in March with market recovering. No dividend and no fresh contribution during this month.

The low cost portfolio finally turned positive for the year.

Link to Yaruzi's low cost portfolio as of Mar 2016