One Year Later…the Numbers.

leesoonkie
Oct 1, 2018
1 min read

One year ago, the partners decided to deploy excess cash into stocks with a view to achieving regular dividend income.

A year later the numbers look like this…

Total Return 11.31%

IRR 22.28%

IRR was significantly higher as the investments took place over a number of months. In addition we were lucky as we exited two growth stocks at a significant profit.

For the comparable period the STI from end August last year to this year was down 1.96% but including dividends on a total return basis was up 1.61%.

The portfolio was heavily weighted towards the REITs in particular the so called "branded" REITS. At historical cost levels the REITs in our portfolio yielded more than 7% in expected dividends.

Going forward public equities will remain a core part of our business. Other markets will ultimately be included.

Given the performance, and more importantly liquidity with holding listed stocks, a rhetorical paradox arises. Other asset classes will ultimately be measured against listed equites.

If you can achieve X% p.a. on holding liquid stocks why sacrifice that for other less liquid assets such as bonds or loans?

Strangely, some of the so called high yield bonds are actually lower in yield terms than buying the REITs.

That’s life for you.